Thursday, November 26, 2020

How best dairy producers focus on performance

August 18, 2020 by  
Filed under Livestock

Britain’s best dairy producers are pulling ahead of the herd – and making much more money than average performers, suggest the latest figures.

The top 25% year-round calving herds are making a margin over purchased feed of £2,219 per cow compared to just £1,465 for the bottom 25%, reveals the annual Kingshay Dairy Costings Focus Report. The figure equates to a difference of £150,800 for a 200-cow herd.

In a comparison of different systems, lower input grazing focused herds came out top on a per litre basis at 22.69p/litre. But the year-round calving, housing focused systems produced the best margin over purchased feed per cow at £1,852/cow.

Overall, dairy margins over purchased feed have increased by 24.1% during the past 10 years – reaching £1,704/cow, suggests the report. Herds have also seen a more modest 14.3% increase in margins per litre over the past decade, averaging 20.33p/litre.

“Margins increased despite rises in purchased feed costs – likely mitigated by increases in yield, milk from forage and milk price,” explains Kingshay senior farm services manager Kathryn Rowland.

Milk from grass

Producers evidently managed to increase forage use after the drought of 2018, with the average milk from forage across all conventional herds increasing to make up 32.9% of yields (2,759 litres) in 2019/20, up from 29.8% (2,486 litres) the previous year.

But the bottom quartile of producers – ranked by milk from forage – still have a long way to go, averaging just 15.4% (1,313 litres) of total yield from forage. Meanwhile, the top 25% of producers achieved 48.6% (4,043 litres).

“Translated to savings in purchased feed costs across the average herd of 200 cows, the top quartile achieved savings of £58,000 more than the bottom 25%,” says Ms Rowland. Larger herds were able to offset higher purchased feed costs with higher yields and milk value.

Herds with 150 to 200 cows tended to produce the most yield from forage (34.7%). Milk price was at its lowest in the smaller herds (up to 50 cows), averaging 27.05p/litre compared to 29.57p/litre in larger herds of 300 to 400 cows.

It has been a relatively stable year for the milk price, with the average only fluctuating by 1.67p/litre throughout the season. But the gap between the top and bottom paid producers widened to 9.1p/litre in March.

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