Profit from your pasture

Wednesday, 5 August 2020

By Kate Parkes

Milking forage hectares

Making the best use of your cows’ forage hectares can help make your herd more profitable. Figures from some of Britain’s spring block calving herds show just how much difference this can make to net margins.

Those with higher milk solids output per hectare tend to make more profit, as shown on the first chart below. They achieve this by optimising stocking rates as part of a sound grazing management system, making the most of the land available and keeping feed costs down. The relationship between stocking rates and higher profits is shown on the second chart.

Measuring success

Milk solids output per hectare is a key performance indicator (KPI) for block-calving herds in our Optimal Dairy Systems work. The top 25% of spring block calvers achieve ‘good’ performance for this KPI, getting nearly twice as much milk solids from every forage hectare compared with the bottom 25%. The herds have been ranked by the value of their outputs in relation to the cost of their inputs, which is a measure of their productivity.

Image of staff member Kate Parkes

Kate Parkes

Senior analyst: farm economics

See full bio

Taking a fresh look at forage use

Grass is the most economical way of feeding dairy cows so it’s worth considering whether your stocking rate and pasture management system allow you to make the most of the land you have available.

We have some resources that can help you compare your herd with figures from the most productive and profitable British dairy herds – to find out where you might be able to manage pasture better and gain more control over your margin:

  • Know your milk solids output per hectare and how it measures up against excellent, good and average performance using our KPI calculator
  • Find out where you can make improvements by comparing your stocking rates, feed and forage costs with our Dairy Performance Results 2018/19
  • Get the most out of your grassland with our Forage for Knowledge resources
  • Find efficiencies with inspiration and ideas from others – our online events include webinars with our strategic farms, consultants, vets and more

If you want to cut costs in other areas too, take a look at Trimming costs, Challenging your costs in challenging times and Lightening your overheads.

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A note on full economic net margin

The margins shown here are full economic margins, which means they include all non-cash costs to the business. These are the costs you can’t see going out of your bank account – machinery and buildings depreciation, unpaid labour and the rental value of owned land.

Always include your non-cash costs when reviewing and planning. If you don’t factor them in you can find yourself short after a few years of depreciation have set in, and your figures won’t be directly comparable with published data.

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