Maximising Profit in Late Lactation
In the past there was a choice as to whether it was worthwhile endeavouring to milk cows at the end of the season. Today it is often a necessity and it can be a profitable exercise. Between March and June factories pay between 25 and 35 cents per litre for premium milk, with a typical test of 4.2% fat and 3.3% protein. This compares with a final payment of 18-22 cents for milk sent over spring and early summer. To cash in on the higher milk price cows need to be kept at a reasonable level of production in late lactation, alternatively some farmers choose to calve some of their herd prior to or during this high payment period.The cost analysis of income from milk production over feed costs at this time of year is illustrated in the top table.
All feed costs are $150 per tonne assuming a mixture of grain, hay, silage and crops. Once the autumn break arrives, feed costs will be reduced to an inputted cost of $50 per tonne for pasture ($100 if nitrogen boosted).
Typical Net Income for a standard production decline over winter spring and early summer is demonstrated in the bottom table of this page. Grass is included in the feed costs at a diminishing proportion as the season progresses. Price of milk rises with test as well as seasonal payment.
As these calculations show, there is very little difference between daily income per cow in April versus August-October despite the relative difference in production.
The first table showing the potential profit from a cow production well during autumn demonstrates the reason why some entrepreneurial farmers are making an effort to produce well at that time of year. Many have split calving so that a greater proportion of the herd are in early lactation in autumn whilst others have maintained the higher nutrition path all the way through spring and summer. Either option is potentially unprofitable if the whole farming system is not managed to cope. If cows produce more milk over 300 days they will need more feed. The timing of the extra inputs, the ability to balance the dietary fibre, protein and energy needs and the management of the pasture, especially the spring flush, will all influence the outcome.
The feeding system does not need to be complicated. A large supply of silage rationed across summer and autumn, supplemented with good quality purchased hay form the basis of the forage ration. Input of cereal grains and a protein source such as lupins, will be sufficient to reach production targets. Crops are a bonus which, in good summers, will keep purchased feed costs down and slow the milk yield decline.
The end result, a cow producing a net profit of over $4 per day for at least 60 days in late lactation, can be the difference between showing a profit for the year or not.
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