Benefits and costs of higher stocking rates on a commercial dairy farm in the Macalister Irrigation District

Abstract

Animal Production in Australia 1998 Vol. 22 BENEFITS AND COSTS OF HIGHER STOCKING RATES ON A COMMERCIAL DAIRY FARM IN THE MACALISTER IRRIGATION DISTRICT R.F. PITMAN and M.T. LARCOMBE Macalister Research Farm Co-op Ltd, Maffra, Vic 3860 SUMMARY In December 1993, the Macalister Research Farm began a whole-farm study to compare the benefits and costs of two systems of dairy farming, based on two different stocking rates. The farm, comprising 80 ha of irrigated perennial pasture, was split into two similar sub-farms. The herd of 250 cows was split into two sub-herds of similar average age and productive capacity. One herd was stocked at 2.6 cows/ha, the other at 3.9 cows/ha. Over the next 2_ years, both herds were managed to achieve similar levels of milk production per cow and high levels of pasture utilisation. Records were kept of all inputs and outputs associated with the operation of each sub-farm. In each season, the higher stocked herd produced more milk per hectare and slightly more per cow, required higher levels of supplementary feeding and other operational inputs, and yielded higher profits than the lower stocked herd. Individual farmers have to decide whether the higher profits of the higher stocked system were sufficient to justify the extra labour and stress involved in operating the larger herd. The difference in profitability between the two systems was very sensitive to changes in the price of milk, and costs of grain and nitrogen fertiliser. The results of this study have been used to develop a ready-reckoner for use by farmers considering variations in stocking rate for their own farms. Keywords: stocking rate, pasture utilisation, supplementary feed, dairy farming systems. INTRODUCTION In December 1993, in response to the demands of district farmers, the Macalister Research Farm (MRF) a community owned demonstration dairy farm near Maffra, Victoria, began a 2_ year extension project to assist farmers who were considering increases in stocking rate on their own farms. Until then, dairyfarmers in irrigation districts had sought answers to their many questions on higher stocking rates from the findings of a study of three different dry-land farming systems at the Dairy Research Institute, Ellinbank (DAV 1994). However, few farmers were confident that these results applied to their own situations. Previous work at MRF (MRF 1992) had shown that well fertilised, irrigated, perennial pasture in the Macalister Irrigation District (MID) could be expected to supply the feed requirements of a dairy herd (plus replacements) stocked at 2.5 cows/ha, for most of the year. Herds stocked at higher rates required increasing levels of supplementation, in such forms as nitrogen fertiliser and purchased grain and fodder. The objective of this project was to measure and demonstrate the major benefits and costs associated with two systems of dairyfarming in the MID, one based on a stocking rate of about 4 cows/ha and the other on a stocking rate of about 2.5 cow/ha. MATERIALS AND METHODS The milking area of the farm was split into two sub-farms of similar size (38 ha) and productive capacity. Each was stocked with a herd of similar average production index. The higher stocked herd comprised 150 cows (3.9 cows/ha) while the lower stocked herd comprised 100 cows (2.6 cows/ha). Apart from their different feeding arrangements, the management of both herds was the same. The feed plan for each herd was determined at the start of each season and modified as the season progressed. The aim of each plan was to keep average pasture cover on each sub-farm between 4.2 and 5.5 cm (as measured by a rising plate meter) from September until March of each season, in order to maximise pasture utilisation. Milk production of each herd was targeted at 5,000 litres per cow. Whenever anticipated or measured pasture growth rates fell behind feed requirements, supplementary feeding commenced. Because of its lower cost, nitrogen fertiliser was generally the first-used form of supplement. As feed deficits became larger, other supplements, including grain, silage, hay and sod-seeded short rotation ryegrasses were also used. Whenever pasture growth rates exceeded cow requirements, larger surpluses were conserved as silage or hay for feeding back on the same sub-farm, while smaller surpluses 129 Animal Production in Australia 1998 Vol. 22 were topped to maintain feed quality. All feed management decisions were based on weekly measurements of milk production (from separate milk vats), pasture cover, anticipated pasture growth rates, and other relevant observations made during weekly farm walks. Records were kept of all major inputs and outputs associated with the project. These included use of fertilisers and feed supplements, pasture management activities, herd and shed expenses, milk production and composition, sales of fodder, cow health and fertility and pasture production and quality. Pasture consumption was calculated from energy produced in milk less energy provided by supplements, using ARC energy standards (ARC 1980). Two measures were used to compare profitability of the two systems:- Income less variable feed costs, and Comparative margin. Comparative margin was calculated by deducting from milk income, all costs (feed, shed, herd and interest costs) which varied between the systems. RESULTS Tables 1 and 2 describe the results obtained in the 1994/5 and 1995/6 seasons. Pasture composition and quality Although pasture composition varied considerably from paddock to paddock and season to season, no noticeable, lasting differences developed between the two systems of farming. Attempts to measure differences in pasture quality, using a limited number of feed tests, produced inconclusive results. Table 1. Performance of dair y cows grazing at high and low stocking densities 1994/95 Herd (stocking rate) High Low 2.6 376 44 65 0 10 12,700 34.5 26.5 0 12 55 11,000 4,180 80 0 546 4,806 504,920 21,536 16,719 5,049 13,287 High 3.9 407 68 101 0 14.5 12,900 11.5 0 1.5 42.5 147 12,600 3,192 77 293 979 4,541 712,210 29,458 23,501 4,784 18,742 1995/96 Low 2.6 160 47 73 0 48 10,000 36.5 1.5 0 9 49 9,400 3,572 350 90 493 4,505 470,390 19,932 15,307 4,704 12,379 Stocking rate (cows/ha) 3.9 Fertiliser applied N (kg/ha) 611 P (kg/ha) 51 K (kg/ha) 76 Pasture renovation (hectares oversown) 30 Pasture topping (hours) 8 Pasture consumed and conserved (kg DM/ha) 13,700 Fodder conserved (tonnes silage DM) 18 Fodder sold (tonnes silage DM) 0 Fodder purchased (tonnes silage DM) 26.5 (tonnes hay DM) 36.5 Concentrates purchased (tonnes grain DM) 157 Pasture consumed by cows (estimated) (kg DM/ha) 13,300 (kg DM/cow) 3,369 Conserved fodder consumed by cows (kg DM/cow) 120 Purchased fodder consumed by cows (kg DM/cow) 420 Concentrates consumed by cows (kg DM/cow) 1,050 Total feed consumption (kg DM/cow) 4,959 Production (litres milk) 777,720 (kg fat) 33,413 (kg protein) 25,688 Productivity (litres/cow) 5,185 (litres/ha) 20,466 130 Animal Production in Australia 1998 Vol. 22 Table 2. Financial performance of dair y cows grazing at high and low stocking densities 1994/95 Herd (stocking rate) High Low 118,159 3.09 3,402 121,561 15,511 10,737 3,340 1,800 0 250 31,638 833 3,300 33 10,100 101 10,000 55,038 89,923 899 2,366 66,523 665 1,751 High 212,075 4.00 0 212,075 20,299 40,208 675 6,400 0 363 67,945 1,788 6,450 43 17,100 114 15,000 106,495 144,130 961 3,793 105,580 704 2,778 1995/96 Low 139,847 3.97 200 140,047 9,744 13,417 2,190 1,440 0 1,200 27,991 737 4,300 43 11,400 114 10,000 53,691 112,056 1,121 2,949 86,356 864 2,273 Milk income ($) 182,078 Milk price ($/kg fat + protein) 3.08 Other income (sale of silage) ($) 0 Total income ($) 182,078 Variable feed costs (excluding water) NPK fertilisers ($) 23,567 grain ($) 32,528 fodder conservation ($) 1,768 fodder purchased ($) 8,922 3,839 pasture renovation ($) pasture topping ($) 200 Total variable feed costs ($) 70,824 ($/ha) 1,864 4,950 Shed costs ($) ($/cow) 33 Herd costs ($) 15,150 ($/cow) 101 15,000 Interest on investment in cows ($) Total costs of key inputs 105,924 Income less variable feed costs ($) 111,254 ($/cow) 742 ($/ha) 2,928 Comparative margin (income less costs of key inputs) ($) 76,154 ($/cow) 508 ($/ha) 2,004 Cow health and fertility The average condition scores of the high and low stocked herds, as they approached drying off, were 4.9 and 4.9 (in 1994), 4.7 and 4.6 (in 1995) and 4.7 and 4.7 (in 1996) respectively. Levels of fertility, as measured by average calving date and proportion of cows requiring induction, were similar for both herds in the 1995 and 1996 calving seasons. Average calving dates of high and low stocked herds were respectively September 1 and August 30 in 1995, and August 30 for both herds in 1996. The proportion of cows requiring induction in each herd in each season was 16%. Both herds experienced similar levels of milk fever (7% of uninduced cows) and mastitis (average BMC for high and low stocked herds were 288,000 and 256,000 respectively). DISCUSSION Differences in production The higher stocked herd out-produced the lower stocked herd in both seasons. The extensive use of feed supplements to maintain similar levels of production per cow in both herds, resulted in the large difference in production per hectare in favour of the higher stocked herd. Differences in pasture consumption Pasture consumption on the higher stocked sub-farm exceeded that on the lower stocked sub-farm by 2,300 kg DM/ha and 3,200 kg DM/ha in Seasons 1 and 2, respectively. While larger quantities of pasture were consumed by the higher stocked herd in almost every month of the year, the pattern of daily pasture consumption of cows in both herds during both seasons showed that the biggest differences in consumption took place in spring and early summer. Much of this difference in pasture consumption was due to the higher growth rates associated with higher levels of fertiliser, particularly nitrogen fertiliser, applied to the higher stocked pastures. The higher growth rates then combined with more intense grazing to increase pasture consumption. 131 Animal Production in Australia 1998 Vol. 22 Differences in levels of supplementary feeding To provide satisfactory feeding levels for both herds, the higher stocked herd required greater inputs of grain and purchased fodder, as well as additional fertiliser at most times of the year. This resulted in higher quality feed being offered to the higher stocked herd and slightly higher levels of per cow consumption and per cow production by higher stocked cows. Differences in profitability In each season, the higher stocked system involved higher variable feed costs than the lower stocked system, but it was also the more profitable of the two systems. Much of the extra profit was generated in the spring, when differences in variable feed costs were at their lowest. On a cumulative basis, the higher stocked system operated at lower profit at the start of the season, because of its higher winter feeding costs, but quickly reversed the situation in the spring and continued to gain in profitability, as the season progressed. Sensitivity of outcome The difference in profitability between the two systems was particularly sensitive to changes in the price of milk and costs of grain and nitrogen fertiliser. Ready reckoner Based on the results of this study, a ready reckoner has been developed to assist farmers with decisions about levels of stocking rate for their own farms, using various prices of milk and grain. ACKNOWLEDGEMENTS We thank MRF sharefarmers John and Maree Condon (1993-5) and Mark and Teressa Saddington (19956) for their co-operation in conducting the project. REFERENCES ARC (1980). Nutrient requirements of Ruminant Livestock, Technical Review by an Agricultural Research Council Working Party (CAB: Farnham Royal, Slough). DAV (1994). ABC of Dairy Farming, Annual Report 1993/94 (DAV 204). MRF (1992). In Dairyfarming in the Macalister Irrigation District (Ed S.Hides) p 57 (Macalister Research Farm Co-operative). 132