Saturday, May 4, 2024

Pain felt from taking radical steps

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“Ow” is how the financial impact of sticking to the letter of the law relating to Canterbury nutrient limits has been described.
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Production on the Lincoln University Dairy Farm (LUDF) finished at 276,019kg milksolids (MS) in the 2013-14 season. But it had been on track to do 300,000kg MS or 480kg MS/cow before the decision was taken in early February to take radical steps so the farm would remain compliant with Canterbury’s proposed Land and Water Regional Plan.

The move to pull out all bought-in supplement for the rest of the season to keep nitrate leaching below the farm’s historical baseline leaching level meant feed demand had to be reduced and cows culled early.

By the first week of March one herd was on once-a-day milking and by mid-April groups of cows began to be dried off to ensure they would meet condition targets in time for calving.

By early May only 250 cows were left on the farm when normally 500-550 would still be being milked twice-a-day, and by May 20 all cows had been dried off.

“Production was 8% behind budget, 24,000kg MS below where we wanted to be and at $8.75/kg MS/cow,” South Island Dairy Development Centre executive director Ron Pellow said.

It meant $200,000 in lost income although savings on silage that wasn’t bought-in helped soften that loss to about $90,000.

LUDF farm manager Peter Hancox said overall operating profit was about $130,000 less than budget due to the loss in milk income, savings in feed, savings in irrigation due to the wetter season, and savings in labour.

In late April the regional council issued a notice saying it would not enforce the new rules for the 2013-14 season given it was difficult mid-way through a season to make changes that would reduce leaching when budgeting and farm management decisions had already been made.

But from this season it reserved the right to take enforcement action against any farmer whose nitrate leaching was above that of the worst year of their three-year average baseline leaching if they hadn’t made a genuine attempt to reduce it.

LUDF would have been non-compliant had it continued to feed silage in the autumn due to the fact it had fed higher inputs in the early part of the season.

It decided to operate within the regulations before the council’s notice and stick with that decision as it aimed to demonstrate the impact of the rules on management and profitability. 

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