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PROFITABILITY
Dairy farm pro ts averaged £185/cow in 2020/21, despite the cost of production outstripping milk income, according to Old
Mill’s annual dairy report. e milk cost of production report, conducted by rural accountant Old Mill and the Farm Consultancy Group, found that average farm pro ts fell from £233/cow in 2019/20 to £185/cow last season.
Dan Heal, rural adviser at
Old Mill, says: “ is is on the back of a falling milk price, rising feed costs and straw prices at levels not seen before. So maintaining pro ts to this level is all the more credit to the dairy industry.”
It was the fourth year in a row that pro ts remained stable above £100/cow, as increased yields o set the fall in milk price. Average yields rose by 151 litres/cow, due to a favourable milk to feed ratio and good quality forage. However, the total cost of production, at £2,393/ cow, averaged more than the milk income of £2,321/cow.
Recovery
is loss was o set by a recovery in non-milk income due to the improved beef market. Herd size has also shrunk – from 307 to 269 – a er farmers culled their less productive animals harder. e top 10% of producers still far outperformed the bo om 10%, due to tighter control on costs, says Mr Heal. He says: “ e bo om 10% incurred £1,097/cow more costs, spending an average of £2,954/cow.” is gap had widened on the 2019/20 average of £950/cow. “Although overall pro tability has declined from last year, the gap between the top-performing and bo om-performing herds has signi cantly widened.” e top 10% spent £320/cow less on feed and £261/cow less on labour than the bo om 10%, while income brought in was £231/cow higher. is is despite the top farms producing lower yields of 7,229 litres per year against the bo om farms’ average of 7,483 litres.
Mr Heal says: “ ere is a huge range of production level within the top 10%; from 4,828 litres/cow to 9,711 litres/cow, showing a focus on e ciency pays whatever the yield. Less e cient setups likely require investment to change this.”
Overall, labour costs have increased by £27/cow, up from £458/cow in the 2019/20 season. is trend is likely to continue due to sta shortages and higher wages, according to Mark Yearsley, of the Farm Consultancy Group.
Power and machinery costs also rose, by £19/cow to £543/cow.
Mr Yearsley says: “ is is no surprise when fuel and energy prices have increased. is is re ected in the silage costs, which have jumped by 42%.”
In the 2021/22 season, labour, energy and machinery costs are expected to continue to rise, so pro ts are predicted to fall to £167/cow, especially as the marginal litres become uneconomical to produce, says Mr Heal. e cost of production is projected to be £2,354/cow against a predicted milk income of £2,165/ cow, down £66/cow as yields decline due to higher feed prices.
However, non-milk income is forecast to rise again, by £365/ cow, in response to the buoyant livestock market.
Mr Heal says: “Compared to the rollercoaster of 2020/21, the current season has felt quite stable up to now. e milk price has been relatively static and, although costs have risen rapidly, forage is in plentiful supply – particularly within the south west of England.
Focus
“All of this points to a winter where the focus needs to be on pro tability rather than production and to ensure any extra litres produced do indeed pay their way.”
Producers have started to realise they have to re-evaluate their businesses and implement change in management decisions, says Mr Yearsley.
“Less reliance on subsidies means reducing costs where possible and improving e ciencies to maintain farm pro ts.”
Profits down but farmers fight back with efficiency
The gap between the top- and bottomperforming herds has significantly widened.
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PRODUCT FOCUS
Improving silage production as part of setting the farm up for the future has brought multiple benefi ts for one North Wales dairy farm, including improved cow health. Forage focus sees improvements in milk yield and herd health
agillt Hall Farm in
BHolywell, Flintshire, is living proof that it is possible to run a successful family dairy farm if you take the right steps. Run by Richard Corbett, his wife Penny and son Ed, the traditional farm, which looks out across the mouth of the River
Dee to the Wirral beyond, is home to the ‘mainly pedigree’ Abbot herd of Holstein Friesians, standing at 160 milking cows and 140 youngstock.
Milk is sold to the liquid market, with the year-round calving herd currently averaging 8,500 litres per cow at 3.41% protein and more than 4% butterfat.
The recent purchase of an extra 30 hectares (75 acres) of neighbouring land has seen the area owned by the family increase to more than 81ha (200 acres), with a further 61ha (150 acres) rented, and there are plans to increase to 200 milkers.
Improving effi ciency
But as well as expansion to increase milk output, there is also a focus on improving effi ciency – with targets of 3,000-plus litres of milk from forage and raising milk yield per cow by an extra 500 litres. It is a process which has included changes to silage production and increased grassland reseeding.
Richard says: “We want as much milk from forage as possible. Britain is a great place to grow grass and it is the cheapest source of feed.
“We reseeded 50 acres this year with a long-term ley and will continue to reseed. All the new land will be reseeded by next year.
“We bought the extra land to secure Ed’s future. This year we planted 52 acres of maize. The rest is down to grass.”
INCREASING ADDITIVE USE
● Rhodri Pritchard of Carr’s Billington Agriculture Ltd, who advises the family on forage preservation, believes additive use is increasing as more farmers are looking to improve milk from forage.
As well as preserving more dry matter, Rhodri says a proven additive such as Ecosyl can help preserve nutrient levels. Manufacturer Volac claims an average across a range of forages of an extra 1.2 litres of milk per cow per day from feeding silage preserved with Ecosyl, he explains.
Rhodri says: “Ecosyl is highly proven with multiple independent trials to back it up. It is my go-to additive. I’ve seen
As part of improving milk from forage, close attention is paid to silage operations. A trusted contractor is used to carry out the bulk of the machinery-based silaging tasks, with the Corbetts taking over from the point of clamp sheeting and sealing, including using side sheets for airtight clamp walls.
Richard says: “We have a good contractor, Dewi Mark Williams from Llangerynw, who does everything from cutting to clamp fi lling. He rolls it, we then put cling fi lm on the top, followed by a strong top sheet, a
the additive promoting forage digestibility and greater intakes.
“As the additive is seen as so effective, it is commonly used on all cuts of grass. When Richard saw such a signifi cant improvement in the grass clamp, he pretty quickly introduced Ecocool into the maize silage as well.” woven blanket, tyres and netting to keep the crows off. We aim to ensile grass at 28% dry matter.”
Recent improvements have included the contractor spreading grass immediately after cutting to improve wilting and a new concrete-walled maize clamp has been constructed this season, rather than ensiling on the fl oor, with the aim of improving consolidation.
But a major step forward that Richard and Ed report has proven itself over the last three years has come from using bacterial silage additives containing the MTD/1 strain of Lactobacillus plantarum – in the form of Ecosyl on grass silage and Ecocool on maize.
This was in response to the family having previously experienced signifi cant problems with heating in both grass and maize clamps, with the face going off at feed-out, plus problems with mycotoxins in the maize silage.
Ed says: “It was almost like it was on fi re.”
PRODUCT FOCUS
Father and son Richard and Ed Corbett are focused on improving effi ciency by increasing milk from forage. Rhodri Pritchard
Additives have always been used and various products tried over the years.
Cool silage
Initially trying the MTD/1-containing additive Ecosyl on grass silage, Richard and Ed say they could see immediately when the clamp was opened for summer buffer feeding that it had stayed cool.
This, in turn, prompted them to use the sister additive Ecocool on that year’s maize silage. As well as containing MTD/1 for improving fermentation, Ecocool contains a second bacterial strain, Lactobacillus buchneri PJB/1, specifi cally for tackling yeasts and moulds which cause heating in higher dry matter silages, such as maize.
Richard says: “There were always problems with heating in grass and maize and the waste was unacceptable. You could see them going off in the clamp before you could get from one side to the other, and the mycotoxins were making the cows’ legs swell. When we went to Ecosyl we couldn’t believe the difference. We buffer feed and we saw the benefi ts immediately when we opened the clamp. When we took the sheet off there was no waste.
“The health of the cows also rocketed because there was no mould. We used to have to use something against the mycotoxins. That was costing us £500 a year. So we have saved on that as well.
“I can’t quantify it, but I think the milk yield also went up with Ecosyl.”
With reduced waste, Richard says there is more quality silage available for cows, and silage intakes have increased. Previously, he says there was always waste at the feed barrier, but now the barrier is clean.
Continued use
Three years on and clamping about 1,000 tonnes of grass silage and 700 tonnes of maize, Ecosyl and Ecocool continue to be used.
Cows receive a mixed silage total mixed ration comprising 70% grass and 30% maize, as well as a concentrate blend, some straw and water if required.
A slightly higher proportion of grass silage is fed to lower yielding cows.
Richard says: “We are trying to get more protein into the low yielders.”
Another benefi t that Richard and Ed see with Ecosyl and Ecocool is that the contractor applies them in ultra-low volumes of water. This avoids the time-consuming job of having to fi ll 200-litre barrels and carting these out to the contractor.
Richard says: “We just mix with water in the two-litre bottle and take it out to the fi eld for him when needed. He normally keeps the bottles ready for use in the cab.”
As well as a milk yield increase from additive use, Richard says milk yield has also increased from reseeding. Maize has also been a good crop this year. Having established this forage foundation, the family is now planning for future yields.
Richard says: “We want to get to 9,000 litres but no higher and continue to maximise milk from forage. We do not want 10,000 litres because we don’t want to push cows too hard and get increased vet bills and reduced longevity.
“Using sexed semen and as many heifers of our own as possible, we also want to creep up to 200 cows.”
In addition, there is a plan to add an extra income stream.
“We want to get to the point where we have surplus heifers so we can sell a few,” Ed says.
