How self-induced is the dairy squeeze?

Carbon Positive Farming
with Peter Burton
Functional Fertiliser Ltd

Prices of dairy products remain volatile and difficult to predict, interest rates have risen and may yet go higher, compliance costs keep climbing, and staffing issues remain challenging.

At first glance the New Zealand dairy scene doesn’t look bright – however, it is little different to the situation in the late-1970s when I first got involved, and all I and other young entrants could see was opportunities.

Britain was no longer the guaranteed purchaser of our product, interest rates were climbing annually, subsidies had been removed from fertiliser and committed staff were difficult to find. 

Farmers that had been settled by the Government after the World War II were looking to sell their properties – and the advice we were given was that there was no way to progress from farm labouring to farm ownership without substantial financial support
from family.

New challenges

The dairy industry is currently this country’s biggest export earner and will continue to be a major player well into the future and solutions to the problems currently faced will be met and overcome, but there are new challenges that have not been faced previously.

Dairy farming in the 1970s and 1980s was recognised as an essential industry and communities and businesses were keen to support. 


Marginal land was developed, extra fertiliser applied, cow numbers increased, and production steadily rose with the family farm of 120 cows morphing into operations of 300-plus cows.

The notion that people in the wider community with little if any direct link to the land might somehow view farming practices as environmentally harmful, and support a movement to limit intensity and productiveness, was inconceivable.

Time will tell, however there is a sound argument that the dairy industry has laid the base of its own contraction through the overuse of nitrogen fertiliser in the quest for short-term sustainability.

The productive capacity of pastoral land is determined by the amount of carbon in the form of soil organic matter in the top 20cm of the soil.

As it is under-grazed permanent pasture that carbon can be most quickly sequestered, it seems incongruous that intensive pastoral farming is now viewed by many as a problem.

This paradox may be explained by appreciating that applied synthetic nitrogen burns and destroys soil carbon with irrefutable evidence available from its similar misuse over many years in Europe.

With less carbon in the soil, the holding capacity for both nutrient and moisture declines. The initial response to declining growth has often been to apply more nitrogen, further accelerating carbon loss. 

An artform

Cows are grazing ruminants and quality pasture remains the lowest cost feed. To maintain total production, grain and imported Palm Kernel Extract have been used with the latest data from DairyNZ showing the gap between income and the cost of production closing rapidly.

However not for all. There are those planning to milk fewer cows sometimes on less hectares, reducing infrastructure pressures with income comfortably exceeding costs.

The industry response to steadily decreasing farm profitability, a trend since 1950, has been to lift the number of cows milked by an ever-decreasing number of people.

Those that have opted not to follow that path have employed alternative technology that does not rely on synthetic nitrogen use and aided by science have turned pasture and animal management into an artform, focussing on the enjoyment that comes from a harmonious low stress lifestyle of their own making.

Functional Fertiliser has, over the past 25 years, provided products and supported farmers that now steadily grow more pasture with a more even spread throughout the year and enjoy outstanding animal health and performance with lower overall costs.



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