Dairybiz+100 – Some resources to help you unlock potential profit……
As a pilot programme, Subtropical Dairy has developed a series of resources and tools to help northern Australian dairy businesses estimate the potential profit from making a change to their business.
We have called these resources DairyBiz+100. These resources have the common theme of calculating what change is needed to make an additional $100 dairy operating profit (or EBIT, earnings before interest and tax) per cow per year, regardless of where a business is at.
Initially we have chosen three key management areas that on the ground can have a significant impact on a farm’s bottom line: Grazing Management, Reproductive Management and Feed Wastage. Within each of these disciplines, there are several resources:
- A calculator to estimate the potential financial benefit.
- Case studies
- A summary of best and key practices
- A checklist to see how a business is tracking and help decide if these changes are right for a particular situation.
Please bear in mind that these tools and resources are just the first step in understanding the potential of making a change. The tools are basic calculators that may not capture the unique aspects of a business, or tell what other impacts making a change may have on another part of a business. Further resources and advice should be sought.
As this is a pilot programme, we would appreciate any feedback regarding how you found the resources and any improvements we could make in the future.
If you have any questions, particularly in regards to using the calculators, please email email@example.com
GRAZING MANAGEMENT – Annual Ryegrass TECHNICAL PRINCIPLES & PRACTICES
• Replacing 1.5 kg of grain in a cow’s daily diet with around 1.8 kg dry matter of annual ryegrass through better grazing management will give around 30 cents more profit per cow per day.
• Growing an extra tonne dry matter of annual ryegrass per hectare costs around $120. Based on a conversion efficiency of 1.4 litres for every kg dry matter, this equates to 1400 litres more milk or around $840 per year or a net benefit of $720.
FERTILITY – TECHNICAL PRINCIPLES & PRACTICES
In year round herds
To achieve an increase in Dairy Operating Profit (or EBIT) of $100 per cow per year means making around 30 cents more profit per cow per day. One option:
•For a 200 cow herd in northern Australia, improving a 100 day in calf rate from 51% to 58% will increase Dairy Operating Profit by around $100 per cow per year.
FEED WASTAGE – TECHNICAL PRINCIPLES & PRACTICE
To achieve an increase in Dairy Operating Profit (or EBIT) of $100 per cow per year means making around 30 cents more profit per cow per day. Some options:
• Moving from paddock feeding of a partial mixed ration to a permanent feedpad with designed troughs will typically reduce wastage from 25 to 5%, an increase in Dairy Operating Profit of $200 per cow per year. Average capital costs for a feedpad will range from $100 to $250 per cow.
• For a farm feeding $600 per cow per year in byproducts, moving from ground stored wastage of 15% to shed storage wastage of 1% will save $84 per cow per year. This saving will be offset by storage shed capital costs which typically can be around $150 per cow.
• Feeding round bale silage on the ground especially during wet conditions can lead up to 35% wastage. Feeding in round feeders can potentially reduce wastage to 5%. For a herd feeding 1.5 tonnes dry matter per year of silage at a cost of $250 per tonne, this represents a potential saving of $112 per cow per year minus the capital cost of feeders.