Address on-farm efficiency to improve profits, conference told
Winter milk researcher Joe Patton said: “While each farmer has a number of options, including staying the same, switching to spring milk production, increasing cow numbers, increasing yield per cow, or improving efficiency, economic analysis showed that it is only by addressing on-farm efficiency that profit and cashflow can be improved.
“In relation to the biggest cost of winter milk producing farms — namely feed — we would urge suppliers to take responsibility for on-farm decisions relating to feed by acquiring the necessary knowledge.”
Mr Patton also told how winter milk producers are operating in a “capped market in a growing industry” and should use the removal of milk quotas as “an opportunity to reimagine their farm business”.
Cathal McAleer, a private agricultural consultant from Tyrone, outlined some of the mistakes which have been made by farmers in the North in chasing milk yield per cow, in the absence of effective milk quotas over the last 10 years.
“While output per cow has increased, it has come at the cost of reduced milk from forage, a decline in grassland management, increases in herd infertility problems, and increased inputs,” Mr McAleer said.
He added that the main beneficiaries of the increased milk output in the North have been the input suppliers that have increased sales. He urged farmers to adopt a target of retaining the maximum amount of the milk cheque.
“Expanding your farm profit is a form of expansion and that this need not necessarily involve more cows,” he said.
Two winter milk producers, Glenn Forde and Larry Hannon, outlined their systems. Mr Forde is milking 140 cows supplying Bandon Co-op, while Mr Hannon is milking 120 cows supplying GIIL. Both recognise the importance of having “the right cow” and are focused on improving their herd genetics with a view to better calving patterns so they can supply their winter contracts by calving the optimum number of cows in a short period in the autumn.
Both are committed to winter milk production, but would like to see more clarity from their processors in relation to the future for their systems. Both are also working on improving soil fertility and grassland management skills.
Liam Phelan, agri-adviser with AIB, which sponsored the event, told farmers that the bank has strengthened its agri-adviser team recently and has a fund of €500m available to support sustainable farm expansion.
He also urged farmers to structure their borrowings accordingly at the outset and that AIB would consider offering a 12-month moratorium on principal repayments on farm loans.
