Bill Webb Feed Solutions Outlook

Dairy farmers are demonstrating their resilience by reducing farm costs in response to the drop in payout. And my impression is the overall attitude out there is reservedly positive – not gloom and doom.

It is encouraging there were good-sized crowds at Fieldays and several of the exhibitors I spoke to said they received strong inquiries, including for machinery.

While dairy might be down, other industries including sheep and beef, kiwifruit and avocados are all doing well, which obviously helps. But it appears even dairy farmers are taking a positive long-term view.

That’s a bit of turn-around from last year when they had to swallow the bitter pill of a significant drop in income. Now many have driven down their costs by reducing labour and getting back in the dairy shed themselves, reducing the cow numbers also the volumes of supplements fed and keeping more cows on-farm during winter. Also, by looking at all their overall farm cost and cutting back where possible has helped the turnaround

The great summer weather and mild autumn-early winter, with six months of good growing conditions, has certainly helped too. It appears for many farmers the cost of production is no longer about $5.25 but could possibly be closer to the current milk price of $4.25 – but of course for many that’s still just break even, so things need to improve and most commentators are saying they will.

Many farmers are continuing to farm strategically, some even investing in new machinery, which makes sense at today’s low interest rates if their existing gear is costing even more in repairs and maintenance.

One machinery company I spoke to has sold seven mixer wagons in the last six weeks. These are big ticket items and aren’t for System 1 or 2 farms but those operating System 4 or 5 which are feeding out almost every day with high stocking rates and using a lot of supplementary feed. This is the opposite to what some other farmers are doing; so different approaches from different farmers. Clearly not all farmers are reducing stocks and feed to achieve their goals. Another machinery company has reported nine tractors sold in recent months, eight of them to dairy farmers.

It is obvious from the technology on show at Fieldays and the intense interest in it, particularly from younger farmers, that technology is going to become even more important to the future of efficient farming.

One device I saw was a pasture plate meter fitted with technology to GPS its location and plotting that on Google Maps gives the farmer precise information on which to make decisions about how to graze and fertilise each paddock.

For our own business, we are now planning maize plantings and taking orders for maize silage. Just how many tonnes are ordered will help us to decide on how much to plant and how much land to leave in grass.

I noticed at Fieldays the usual specials for forward orders of Palm Kernel Extract were not on offer, with the prices being firm around $225 to $235 a tonne due to demand from other overseas countries to burn for fuel, but also helped by of the strength of the NZ dollar against the US dollar.

That works out at 27 to 28 cents per kilogram of dry matter; and at that price farmers can afford to pay up to 33 cents/kg/DM for maize silage that’s close to the farm because of its superior feed value at that current price. Refer to the DairyNZ feed calculator.

Buying New Zealand grown, quality maize silage also avoids the concerns around PKE about where it comes from, its quality and the fact Fonterra is trying to reduce the amount farmers feed their cows. To give assurance to overseas buyers that the quality of inputs doesn’t affect the end product. Interesting to note, reported in April’s Coast &Country News that with less PKE being fed out this season, milk quality has increased.

This season we also have round bales of good quality wood shavings for sale. They contain about four cubes of wood shavings and are easy and convenient to handle, either for spreading in or topping up calf pens. Also for duck or chicken farms as well.

These are the personal opinions of Bill Webb.