Thursday, 02 June 2022 11:55

Controlling feed costs

Written by  Ian Williams
Maize growers are urged to soil test to determine the right amount of fertiliser to apply to their crops. Maize growers are urged to soil test to determine the right amount of fertiliser to apply to their crops.

Everywhere I go, whether it be in town or on farm, I hear a similar topic being discussed. It’s the fact prices have risen and as a result farmers and growers have become very focused on controlling on-farm costs.

It seems ironic to me that the last time dairy farmers were very focused on controlling costs, we were in a totally different situation. It was the 2013/14 season and payout was low at $4.40/kgMS, having dropped from $8.40/kgMS the prior season.  In contrast, this season’s price is predicted to be a record of more than $9.00/kgMS. However, some of the excitement associated with high returns has been taken away by the large rise in on-farm costs.  Some commentators are saying the average price rise is ranging between 15-20% but some inputs have nearly doubled in cost (e.g. urea).

In situations like this, it is important to focus on things you can control and leave what you can’t. Costs are one thing you can control and when it comes to costs, there are three very important questions you should ask yourself. These are:

Do I really need this?

A good example of this is nitrogen on your maize crop.  A few years ago, Plant and Food, FAR, Waikato Regional Council, DairyNZ and Pioneer conducted a series of trials looking at whether there was a yield response to fertiliser on long term dairy effluent paddocks. The trial used a split plot design and compared industry fertiliser recommendations versus those grown with no base, starter or sidedress fertiliser.

This research showed there was no significant (NS) yield response to fertiliser on the effluent paddocks. In other words, farmers would’ve wasted their money fertilising these maize crops.

We recommend maize growers soil test to determine the right amount of fertiliser to apply to their crops, but by choosing effluent or high fertility paddocks, it is possible to reduce the cost of growing maize significantly.  The costing in the new 2022 Pioneer maize silage catalogue puts the cost of fertiliser at nearly $900/ha or 4.1c/kgDM (based on a 22tDM/ha yield).

Site 1 2 3 4 5
No fertiliser 25.8 25.4 31.1 24.6 26.4
Fertiliser 26.7 26.1 31.9 26.0 26.9
Signifiance NS NS NS NS NS

Table 1. Yield response to fertiliser in maize grown in long term effluent paddocks (tDM/ha)

Another example is feeding supplement when there is enough pasture to fully feed cows.  Response to supplements can be as high as 180 gMS/kgDM in situations where there is a genuine short term feed deficit, but as low as 20 gMS/kgDM when there isn’t! A great rule of thumb to avoid feed wastage is this:  when the cows are consistently leaving less than 1,500-1,600 kgDM/ha pasture residual, feed more supplement, if they are leaving more than 1800 kgDM/ha feed less.

Is there a cheaper alternative?

The price of maize silage and PKE have historically been closely aligned. Many farmers have fed both, with the ratio varying according to price.  Now, with the price of PKE sitting well above $500/tDM, whether grown on farm or bought in, maize silage is most likely a cheaper alternative.

Another example is urea. With the price of nitrogen being at an all-time high, consider using effluent from the dairy shed or feedpad as a fertiliser source.

How can I maximise the return from the money I have spent?

While reducing feed cost is important, a focus on minimising losses and maximising returns can be more profitable.

An example of this is as follows. Both Farmer A and Farmer B buy in 200tDM maize silage. Farmer A stacks theirs for 35c/kgDM and Farmer B stacks theirs for 36c/kgDM. Farmer A doesn’t manage the stack well which results in 20% wastage of the feed they purchased.  The true cost of the maize in the stack, including the cost of wastage is now 43.8 c/kgDM.  Farmer B keeps stack wastage to 10%. The true cost of the maize is $40.0 c/kgDM.  Although farmer A may have initially paid less, their substandard stack management has meant that their feed has actually cost them more than Farmer B.

Both farmers feed their silage to their cows and let’s assume they have the same feed out cost of 8 c/kgDM and milk return of $9.30/kgMS. Farmer A feeds their 160 tDM maize silage when they have plenty of pasture. They get a 50 gMS/kgDM response and a net milk return (after feed and feeding cost is deducted) of -$8,400. Farmer B feeds their 180tDM when there is a genuine feed deficit and gets a feed response of 100 gMS/kgDM. Their income from their 180 tDM maize silage is $167,400 and the net milk return of $81,000.

Through better stack management and feeding the silage when it is genuinely needed, Farmer B has made money off their silage where Farmer A has lost money.

More like this

Carry on with clever feed planning

In many parts of the country, dairy farmers have enjoyed favourable growing conditions throughout winter and spring, leading to reduced use of stored and imported feed and higher-than-expected production to date.

Maize grain shortage looming?

If there is a maize grain shortage next season, farmers will have to look for an alternative and that may not be easy.

Maize grain dilemma

North Island maize grain growers are facing an uncertain future in 2025 as the country's energy crisis hits the rural sector.

Featured

Food charity to hold online auction

Meat the Need, New Zealand’s dedicated charity delivering locally sourced protein meals to food-insecure communities, is launching an online National Charity Auction.

Kiwifruit sector's big night out

The turmoil and challenges faced by the kiwifruit industry in the past 30 years were put to one side but not forgotten at a glitzy night for 400 kiwifruit growers and guests in Mt Maunganui recently.

National

'Quite a journey'

Former Synlait chief executive Grant Watson says the past two years have been quite the journey.

DairyNZ levy to increase?

Retiring chair Jim van der Poel has used his final AGM to announce the intention to increase the DairyNZ farmer…

Former Fonterra CEO dies

Former Fonterra chief executive Theo Spierings passed away in the Netherlands over the weekend.

Machinery & Products

Milk Sustainability Centre launched

The recently announced Milk Sustainability Centre – a collaboration between global giant John Deere and milking and feed specialists De…

Data connection made easier

New Holland and Case IH are introducing new advancements in their precision technology stack to make farming easier and more…

» Latest Print Issues Online

Milking It

Feed from farmers

OPINION: The country's dairy farmers will now also have a hand in providing free lunch for schools.

Brighter future

OPINION: The abrupt departure of Synlait chief executive Grant Watson could be a sign that Chinese company Bright Dairy, the…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter