Along with c 350 others, I attended the Teagasc Dairy Conference at Limerick Racecourse yesterday.
Conference opened with two very interesting presentations from Jim Woulfe, CEO of Dairygold co-op and Tom O’Dwyer of Teagasc following.
2020 and beyond, Dairygolds strategy
I always find Jim Woulfe speaks the punter’s language and he outlined the prospects for growth for the dairy industry. We currently live in a world with 3 billion others but by 2050 this will have grown to 9 billion.
The obvious demand for additional food to feed us all by 2020 is being driven by Asia where supply of dairy is running behind demand. Supply is increasing by 4% in China while demand is going ahead at 7%.This creates opportunity for temperate climates such as ours to meet their shortfall.
The fact they require dried products further enhances the opportunity to export. In 2008 China imported 50,000 tonnes of Whole Milk Powder. By 2013 this had increased to 500,000 tonnes.
To put this in context, this is equivalent of 3.75Bn litres of milk or 70% of the entire ROI production.
However, with infant milk powder, Jim told us “you cannot afford the first mistake”. Consequently Dairygold have invested in technology and improved facilities, both to handle the increased volume of milk from their producers and to comply with quality requirements. Jim advised they were investing to compete at the top end, planning to spend €100m in next 6 years.
Currently there is a slight softening of dairy prices with buyers buying short and small. The recent high prices have been driven by a combination of environmental situations which have softened supplies but also driven demand. He advises Dairygold have committed to take their suppliers milk which is predicted to grow by 52.9m litres of milk in the next 5 years. They do business in 50 countries and are well positioned to capitalise on population growth.
The most interesting point I took from Jim’s presentation was us how in the next 40 years, we will need to produce as much food as we produced in the past 8000 years!
What can your dairy farm do for you
Tom O’Dwyer was next up. He challenged all present to clarify WHY they were farming and encouraged farmers to calculate their return on investment.
Interestingly, in 2007 NZ hit a drought and costs increased by 25%. These costs have never been ratcheted back and he warned the same could happen here. He encouraged all to become BETTER before BIGGER. Grass growth is the key and a guy growing 11.2 t/ ha vs the guy growing 7.5t/ha will carry 42% more cows, the equivalent of €640 /ha extra income.
Following on from Tom’s challenge to improve and grow more grass, Deirdre Hennessy gave us an interesting summary of her recent trials on the benefits of white clover. A 20% inclusion rate increases herbage production and gives benefits in terms of animal performance.
Her colleague Vincent Griffith outlined the benefits of Teagasc driven PastureBase Ireland which is developing a national database to assist farmers’ decisions about grass on their own farms.
Converting grass to milk efficiently
The most refreshing presentation I have seen in a long time came from Dermot O’Connor, a proud Limerick man. He left an engineering job and went back to farm in 2008, forming a partnership with his father Tom.
Dermot outlined how he wanted to expand to become viable and has clear targets and measures to allow him do so. He measures grass weekly at a minimum and knows which paddocks are performing and which are not.
He has identified a need to spend €6k annually for the next number of years on P and K, along with a programme of reseeding, to increase grass growth to his targeted 14 t/ha. This will allow him to increase cows from his current 100 to 150.
Dermot was young farmer of the year 2012 and his parting line from Dr. H. James Harrinton was that “Measurement is the first step that leads to control and eventually to improvement. If you can’t measure something you can’t understand it. If you can’t understand it, you can’t control it. If you can’t control it, you can’t improve it”
Some other snap shots from the conference included options around partnerships, the difference between cash and profit and some steps to improve labour efficiency on farms.
Tom O’Connor from Teagasc gave us some very interesting facts around efficiencies. The most efficient dairy farmers milk 120 cows per hour and start evening milking 45 minutes earlier than the average. They have backing gates and don’t leave the pit as they also have drafting facilities. They have calving pens that can be cleaned out with a tractor (the wheel barrow has had its day!) and rear calves in groups, fed once a day.
Tom outlined it wasn’t about short cuts, just making life easier and working less hours, finishing at a reasonable time and taking part in family life and off farm activities.
I suppose this neatly brings us back to Tom O’Dwyers point at the outset, clarity – why are you farming – do you enjoy it – and the efficiencies suggested might help in keeping the enjoyment in the day’s work!!!
Very enjoyable day all round and Limerick race course is an excellent venue!