By Peter Burton
The days of capital gains, particularly on intensive dairy operations has come to a grinding halt and that’s causing real concern amongst many farmers, and it shouldn’t.
A payout in excess of $7/kg/MS should provide any well-run operation with enough income to service debt, pay wages, and fund a lifestyle the envy of many business owners, and yet a significant number are struggling to pay down debt.
Obviously, the size of the debt is a genuine factor, however there’s something else, which unless addressed will continue to erode financial surpluses at an ever-increasing rate.
The reality is that pasture production is steadily declining, at an ever-increasing rate, and it cannot be blamed entirely on drought and flood.
Soil carbon levels have steadily decreased in the Waikato over the last thirty years at a rate of one tonne of carbon/ha/year, coinciding with the time over which synthetic nitrogen in the form of urea has been regularly used.
Time will tell how direct that relationship might be however in the short-term having an accurate figure of total pasture grown each year is information all farmers should have at their fingertips, because it’s pasture that generates profit.
Without accurate growth data for the current and previous season, decision making regarding fertiliser, supplementary feed, stocking rate, and calving/lambing dates is little better than guess work and that’s no longer good enough.
It was not data that I knew as a sharemilker, and as farm owners we should have made it our business to know, however it was easier not to. We simply carried on without a sound business plan, believing that ever increasing land prices would keep the Bank at bay.
When the total annual pasture growth figure is known, particularly monthly growth rates, decision making becomes a whole lot simpler and fear of what might go wrong significantly declines.
Based on accurate growth rates from an intensive dryland dairy unit near Edgecumbe over the last 11 years a reasonable variation between a dry and ‘normal’ season is 4,000kgDM/ha.
And it’s important to remember that there’s 1,500kgDM/ha of base pasture cover that can be utilised if necessary.
The years of least growth are a result of dry summers with slow growth over the second half of January, February, and into March.
By ensuring a 30-day grazing interval is obtained by Christmas the effect of a dry season doesn’t kick in until February, and its only when the normally reliable early March rain doesn’t arrive that a change in plan is required.
With good data a worst-case scenario can be planned for and the steps of early culling and grazing off can be taken, followed by an early dry-off date if necessary, eliminating the skinny animal/no feed situation.
Dry summers and autumns are never welcome, but they are part of farming and with a generous stash of hay/silage on hand the driest of seasons can be managed.
Eliminating regular urea applications is a game changer. Synthetic N reduces soil carbon, or at best slows the rate at which it is sequestered, which is important as an extra 1% increase in soil carbon may result in an extra 144,000 litres/ha of moisture stored within the rootzone of pasture.
Less synthetic N means an increase in clover and an abundance of clover protects the soil surface reducing evaporation. Even gumboot high mature clover remains highly palatable, nutritious, and digestible.
Conversely when soil temperatures are above 20℃ grasses will produce a seed head with feed quality deteriorating and declining animal consumption.
The usual counter is to graze to a lower level and increase the frequency of grazings resulting in shallow rooting plants, lots of bare earth, and a general feeling of despair.
Autumn is the ideal time to gather the data necessary to carefully plan this winter’s and next season’s feed.
When a total feed grown figure is obtained, formulating an effective fertiliser and feed management plan becomes much easier.
For more information contact Peter on 0800 843 809.