Region: National
I’m convinced, but I can’t afford to take paddocks out of production.
Date: 2011-01-12 | Category: Dairy
Actually, you can’t afford not to.
Let’s look at what happens on a typical 120ha dairy farm. How much income do dairy farmers miss out on if they have a number of run-out pastures, but undertake only their normal pasture renewal over 5% of their farm area, rather than renewing 10% of their farm?
| Let’s use a typical dairy farm as an example: |
| Average dairy farm size: |
120 hectares |
| Area presently renewed after crop [5%]: |
6 hectares |
|
It’s a powerful argument
If you sow an additional six hectares [5%] of new pasture every year the benefits compound: in year two, you sow another additional six hectares of new pasture, while gaining the benefit the extra six hectares of new grass sown in year one.
With each passing year, the potential income lost from not regrassing an extra 5% of the farm gets bigger and bigger.
We have covered what could have been earned: [we’ve factored in a 10% annual decline in the extra production off the new pasture]:
So you can see how the lost income keeps stacking up when renewal of poor paddocks is not undertaken.
This example omits two things.
It does not include the harder to quantify but no less real benefits of the additional ME produced by these paddocks.
Or the extra growth in year six, seven etc from the new pastures sown.
| So... |
|
|
| Year 1: |
Extra income from extra 6 ha new pasture |
= $9,000 [$1,500 x 6ha] |
| Year 2: |
Total increased income |
= $17,100 [$9,000 from new pasture + $8,100 from 2nd year pasture |
| Year 3: |
Total increased income |
= $24,300 [$17,100 + $7,200] |
| Year 4: |
Total increased income |
= $30,600 [$24,300 + $6,300] |
| Year 5: |
Total increased income |
= $36,000 [$30,600 + $5,400] |
| Total |
Increased income before costs over 5 years |
= $117,000 |
|
Less the cost of pasture renewal:
To renew an extra 6ha of pasture on a 120ha farm will mean the loss of 2 t DM/ha growth [through nine weeks out of grazing].
In total, 12 t of dry matter is needed as replacement feed each year.
| 12 t DM silage @ 30c/kg DM |
= $3,600 |
| 5 year silage cost |
= $18,000 |
| Direct cost of renewal/ha |
= $932/ha |
| 6 hectares |
= $5,592 |
| Over five years |
= $27,960 |
| Total cost [renewal + silage] |
= $45,960 |
|
Less the cost of extra MS production:
Extra milksolids [MS] production has a cost, as mentioned here.
| Cost of extra MS production |
$46,800 |
| |
[40% of $117,000] |
|
Net Benefit
The net benefit is lower as you are analysing the farm at year five. There is still benefit from pasture renewal to come, especially from pasture sown in year 5. While pasture renewal itself is highly profitable, the benefit is likely to be the gain in capital value of the farm from its extra MS production.
| Extra MS production |
$117,000 |
| Less pasture renewal cost |
$45,960 |
| Less cost of extra MS production |
$46,800 |
| Net benefit |
$24,240 |
|
|
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More frequent pasture renewal is perhaps the most effective way to get significant production gains in a New Zealand farm system
