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Matt Ryan

Management Hints

August 2023

HOW TO FINANCIALLY MANAGE FROM NOW!

  • Profit in farming is dependent on the relationship between sales and cost – the wider the gap the greater the profit!
  • Over the years, I have been trying to get farmers to do the Cost Control Plan, but I have failed miserably.
  • At a recent discussion group, Sean O’Donnell outlined his simple system as follows:
    • “The financial management I do is pretty simple. I never really had the discipline for doing budgets so I found this worked best for me. I take the milk litres sold each month and multiply it by my target cost figure, ie. 100,000 x 30c/L. That means I have €30,000 available to pay my bills, repayments, wages, etc. for the month. I leave that money in the trading account and I run that account pretty tight.
      “The balance of the milk cheque is then transferred across to a deposit account and remains there until needed or saved. If we ever get really tight or something unexpected comes up, then we know we have money there to deal with it. My aim is to accumulate as much as possible into the deposit account. This might not suit everyone, but I have found it works for me. It is a mental thing/discipline.”
  • Try this for the remainder of the year.
  • Address the big costs that will accrue for the remainder of the year:
    • Now, to give you peace of mind, set aside, money to pay:
      • Your tax bill.
      • Your loan repayments.
  • Don’t put yourself in a position to have big meal bills by being over-stocked:
    • Sell off, without sympathy, cows that will be culled later in the year, R2s not in calf and other ‘non-productive’ animals.
    • R2s that you will not want.
    • This will allow you build up grazed grass for grazing in late November; thus, shortening the winter.

ADEQUATE WINTER FEED MUST BE A PRIORITY?

  • That is the question, and you must methodically take steps to answer. 
  • The first thing to do is estimate the amount of feed you have and are likely to get between now and September, if any.
    • I think everyone is able to estimate the amount of silage in a pit and count the number of bales available – do this calculation.
    • If silage was dry at cutting it would be advisable to get it analysed – do that now.
    • I suggest, until you know exactly, that you use 20% DM for pit silage and 35-40% DM for bales, unless you have reason to believe otherwise.
    • If you have a pit of 300t that is 22% DM, then you have 66,000kg DM (300x1,000x0.22).
    • If you have 60 bales (600kg each) that are 35% DM, then you have 12,600kg DM (60x600x0.35).
    • Therefore, there is a total of 78,600kg DM of feed available. Maize, straw, hay, kale etc. should be added in the same way.
  • Then, list out all the cows, weanlings and in-calf heifers plus other stock that will be wintered, decide on your length of winter, allowing 15-20 days extra to risk manage for a longer winter, as per Table 1.

Table 1: Calculating the kg DM required on a farm for winter.

Numbers

Winter (days)

DM/hd/day

Planned meal (DM/hd/day)

Net roughage
(kg DM/hd/day)

Total (kg/DM)

50 cows

120

11

0

11

66,000

7 in-calf heifers

120

9

0.5

8.5

7,140

7 weanlings

120

5

1.0

4.0

3,360

2 1.5-yr males

100

9

0

9

1,800

Total

 

 

 

 

78,300

  • In the above example, the farmer has adequate silage, but a reserve of 10% would be advisable.
  • From what I have seen so far, some overstocked farmers are 10-20% short while many ordinary farmers are tight. The question is what can and should farmers who find themselves in a deficit do now?
  • There is a computerised programme to do this calculation for you – talk to your Teagasc adviser, or I can send it to you.

OPTIONS IF SHORT OF FEED?

  • Several options are available at this point in time:
    • Sell off cattle/cows between now and winter – that will save grass now for other stock and reduce winter feed needs.
    • Some farmers who are short of grass and silage are planning to milk once a day. There will be a few benefits and costs:
    • Feed requirement will be reduced by approximately 2kg
      DM/hd/day, saving 50c, but milk yield will be reduced by 25% approximately 2-4L, valued at €0.90-€1.80.
    • The big payoff will be in terms of improved body condition score (BCS); therefore, worth doing with thin cows.
    • Forward buy meal and straw now for feeding next winter (buy barley off combine).
    • Sow redstart, rape, early in month, for feeding with straw or silage to dry cows or cattle.
    • Buy maize or grass silage, being careful not to pay too much.
    • Westerwolds, Hybrid Italian or Italian ryegrass will also contribute both in autumn and in spring – yielding 12-16% more grass. Therefore, shortening the winter. I favour Hybrid Italian.
    • Any of these forage crops or Italian ryegrass could be sown on some badly damaged dry grass field or fields burned up by drought, to give extra winter feed.
    • Rent dry grazing fields now and build up grass to 2,500kg
      DM/ha for feeding from November onwards.
    • As a general principle now, if short of grass for grazing, try to avoid feeding large quantities of pit silage. Use meal, 4-6kg, zero graze grass from outside farm or buy from local farmer, graze second cuts, etc.
  • Forage crops could be considered in tillage area:
    • Rape must be sown in early August and it should yield 3-5t
      DM per hectare. The maximum feed per cow per day that can be fed in November-December is 2kg DM. The seeding rate is 3.5-4.5kg per acre.
    • Stubble turnips yield expectations are 3.7t/ha and can be fed ad lib. The seeding rate is 2kg/acre.
    • Kale could be sown in early August but yield will only be 4-8t/ha. The seeding rate is 3.5-4 kg/acre.
    • Redstart will yield 4-6t DM/ha. Some tillage farmers in GLAS have to sow a ‘nurse crop’ and a dairy farmer could do a deal, at low or no rental cost, with them for this venture. 
  • Winterage represents an option for most farmers with some dry land on an outside farm block:
    • It involves building up grass from August-September.
    • High stocked farmers might rent land nearby for this purpose (€30-50/acre).
    • The fertiliser required should not be more than 20 units of nitrogen (N) per acre, because these fields will not be grazed until November, and we do not want more than 2,500kg DM/ha cover.
    • If there is more, too much decayed grass results.
    • The daily allowance for a dry cow should be 13-14kg DM/cow per day.
    • Therefore, one hectare will feed 50 cows for 3-3½ days.
    • Silage (grass) could be bought.
    • Get it analysed first (do not buy a pig in a poke!).
    • But it should not cost more than €45-€60/t (72% DMD)
    • Maize and whole crop silage purchased at €85/t and €110/t, respectively, represent an option also.
    • Green barley could be bought off the combine and stored using propionic.
    • Easy, but a corn roller is required during winter.

ADVICE ON FERTILISER AND GRASS TARGETS?

  • August is a key month to build up autumn grass by achieving grass targets and judiciously using fertiliser to grow grass as growth rates decline.
  • Table 2 outlines the nitrogen recommendations for various stocking rates, but be guided by your annual N allowance. 

Table 2: Nitrogen recommendations (units/acre) for various stocking rates in August-September.

Cows/ha

August

September

2.1 or less

None

14

2.2-2.4

14

14

2.5

26

14

2.6+

28

20

  • To maximise benefit from N, make sure Sulphur (s) is adequate and include potash.
    • Potash is deficient on many farms, so now is the time to apply 30-50 units/acre.
  • Rotation then would need to be 25-30 days.
  • Graze very tight, down to 4cm. This will have the effect of:
    • Slowing down rotation length (every ¼ day in each paddock adds up).
    • It will set up the swards for quality autumn grass and can make it easier to graze them out later on.
    • The effect on milk yield will be minimum if meals are being fed.
  • Table 3 indicates the approximate target grass covers for various stocking rates for August.

 

Table 3: Target grass covers for various stocking rates in August.

Cows/ha

Rotation length

(days)

Aug 15       Aug 30

Target/LU

(kg DM/ha)

Aug 1   Aug 15    Aug 30

Avg. farm cover

(kg DM/ha)

Aug 15

Pre-graze cover

(kg DM/ha)

Aug 15

2.0

25               30

180          200         300

400

950

2.5

25               30

180          200         300

500

1,162

3.0

25               30

230          250         330

750

1,375

3.5

25               30

200          220         310

770

1,590

4.0 

25               30

200          220         310

880

1,750

    • This table shows the cover we must aim for in August but if growth rates are higher than normal, it may provide an opportunity for farmers short of winter feed. With high growth rates, they should target a stocking rate of 3.3-3.8 cows/ha on the grazing area. And cut silage off the remainder.
    • The table also shows that farmers can get by on no unnecessary meal expense at low stocking rates.
    • For example, a farmer with 2 cows/ha only needs a cover of 1,070kg DM/ha on the next paddock if his overall average is 680kg DM/ha.

START GRASS BUILD-UP!

  • This sounds like a contradiction this year but must be the plan.
  • It must be done if you are to capitalise on the high milk output with low-cost inputs.
  • It starts now – it should be easier than usual this year there are good moisture levels in most areas, thus, ensuring good growth rates.
  • However, you may still have to do some of the following:
    • Reduce stocking rates by selling (must be seriously considered from a winter feed point of view) or moving stock to an outside farm. You will not be able to build grass if you are stocked at greater than 2.9 cows/ha on the milking block.
    • Feed supplements, meals (soya hulls), or silage, to reduce daily grass demand (this is not a sin, but a good practice).
  • Close up ground for a third cut/graze.
    • Do this by grazing at 2.9 cows/ha (see above recommendations for this year’s expected growth), staying on a minimum of 25 days' rotation. 
    • This means, if you are stocked at 2.5 livestock units (LU) over the whole farm, you have 0.4ha/cow left for a three-cut-graze area.
  • This three-cut-graze area should get the following management:
    • It should be a clean-cut silage field or a severely topped grazing field.
    • Apply 50-60 units/acre of N at closing with 2,000 gallons of slurry, if available.
    • Leave for 42 days before grazing.
    • If you are running short of grass on the grazing area during this period, then you can graze some of this before 42 days, so you lose nothing by this plan.
    • In fact, you grow more grass – enough to feed 10-12 cows for one day for each acre devoted to this – because you have used 30 units/acre more N applied.
  • The big benefit of doing this is that the grazing season will be extended:
  • Therefore, the winter will be shortened.
  • Also, an extra profit of €2.80 per cow per day for every extra day a cow is at grass in autumn/winter (even for three to four hours).
  • Associated with this issue is getting into the correct ‘lane’ of grazing paddocks.
  • You are now on the third-last grazing rotation. What responsibility does that carry?
    • It means that paddocks being grazed first next spring will have to be grazed first in this rotation.
    • That means the first week of August.
    • Failure to plan this event will mean you won’t have grass in the paddocks next spring where you want it, that is, nearest the milking parlour or dry fields.

ACTIVE CLOVER MANAGEMENT?

  • Continue to care for clover swards sown this year by:
    • Using a clover-safe spray to kill weeds if it not too late to do so.
    • Graze swards at a cover of 800kg DM down to 3.5-4cm, that is very tight.
    • Apply zero or little N (5-7 units/acre).
    • Apply one bag 0:7:30 per acre after every second grazing.
    • Increase rotation length to 42 days over the next 4-6 weeks.
    • At closing, the paddock must be grazed down to 100-200kg DM cover.
  • Where red clover is grown on an outside farm block for silage, it should not be receiving any N but two to three bags 0:7:30 per acre after each cut.
    • Continue cutting for silage up to September, tedding, wilting and bailing for silage. 
    • Thereafter, zero graze the grass because it would be impossible to preserve as silage, but it should never be grazed because of the damage done by animals’ feet.
  • In late July/early August reseed pastures on the milking block by ploughing or, preferably by min-till, sowing ryegrass with 1-2kg white clover per acre.
  • It is imperative that you identify the field into which you intend sowing clover next year. Manage them as follows:
    • Spray with dock spray NOW because it cannot be used in the year of sowing clover as its residue kills the clover seedling – roundup doesn’t have the same effect.
    • Apply adequate lime to bring the pH over 6.5.
    • Apply phosphorous (P) and potassium (K) to bring them to Index 3 or 4.
  • Where clover is very plentiful feed Bloatguard through the water – in water troughs and moving the container daily.

MARK CASSIDY’S ‘COP-ON’ LIST

  • At the Irish Grassland Association’s excellent farm walk on his farm, Mark Cassidy outlined an interesting concept to help manage staff and relief milkers – his ‘cop-on’ list.
  • You might know what to do, but that doesn’t mean others do, so make sure to share your insights and tips. 
  • I will share a few items from his list, which are set out under various headings:
    • General:
      • If you find slurry/water overflowing or flooding, try to fix it and let someone know immediately.
      • If you notice something out of place, pick it up and put it where it belongs. Everything has a place. Put things back where you found them.
  • Yard feeding:
    • Don’t put fresh silage on top of old/stale silage.
  • Sick cows and calves:
    • If you see a cow or calf with ‘sad cow disease’ let someone know.
    • Cold new born calves need to be moved to a hot box.
  • Milking parlour & yard:
    • Check milk tank is cooling, and that water and lights are turned off before leaving the parlour.
    • If teat-spray gun is leaking, fix it if you can, or turn the teat spray off and tell someone.
    • Don’t leave cows in crush/pen overnight, ask what to do with them.
  • Water & grass:
    • If cows are bawling it means they are not happy, either food or water is missing. Let someone know.
    • Check that cows have water when letting them into and bringing them out of a paddock.
  • Electric fence & gates:
    • If you open a gate, please close it.
    • Gate handles need to be hooked onto the ‘live’ side of the insulator, not the post side.
    • If you see a fence down, fix it or write it down on the whiteboard or tell someone.
  • Quad & fuel:
    • Quads have a reserve fuel tank, to use when main tank is empty.
    • If you put the quad on reserve fuel tank, remember to top it up or write it down on the whiteboard or tell someone.
    • There are many, many more but this is a flavour of what you can/should do to help staff.

Finally:

  • Scan all cows and heifers in August to confirm pregnancy – stock bull must have been out for last 30 days.
    • The value of this is that cull cows can be identified. Due to a shortage of grass and winter feed they can be dried off and culled.
    • As well as this, it gives you the information to review the success of your breeding season just ended. This is a vital chore so that you have a better year next year.
  • Meals for other stock:
    • The response of meals to R1s is probably 4:1 in August and definitely that when grass is scarce. So, 1-2kg/hd/day is justified.
    • Make sure R2s, particularly those under target, are not suffering. Palm kernel would be an ideal grass stretcher as it is easily fed.
  • Reduce your workload by:
    • 13-times-per-week milking.
    • Spreading nitrogen once per month.
    • Use a contractor (or neighbour) to spread slurry, do maintenance work etc.
  • Take a few weeks’ holidays:
    • A neighbour, family member or discussion group friend could oversee an in-experienced relief person doing the work while you are away.
    • A few days away with the mobile phone on are no use to you.
  • Dosing calves for hoose and stomach worms may be necessary:
    • If calves start coughing it may indicate the onset of hoose.
    • If calves exhibit sticky dung around the tail-head, it indicates the presence of stomach worms.
    • Take a dung sample to check for parasites before dosing.
    • Change milk liner now to prevent mastitis/high SCCs, and reduced milk yields. 
  • To avoid big tax bills this year, talk to your accountant now.
    • For sole traders income averaging will not be much of a help this year because the last few years were good
  • Some of the following might be considered:
    • Formally paying a spouse and family members a wage, a family member over 14 years can earn €16,500 tax free.
    • Increasing your own pension contribution.
    • Taking an agricultural education holiday/sabbatical.
    • DNA testing the whole herd plus the R1s and R2s – the benefits would be huge in the long-term.
    • Repair work, fencing, electrical, building/machinery repairs, roadway repairs, upgrading water system, reseeding, small drainage works, batch latch, electronic heat/health detectors, etc., is tax deductible at the higher marginal tax rate.
    • Make judicious capital investments to help you achieve environmental requirements and make life easy for yourself and your family.
    • Consider investing in renewable energy where the tax write off could be 100%.

“There is no correlation between the amount of money one earns and the amount of money saved.” That is an interesting statement!