Buying feed on a per acre basis is fraught with error, Teagasc

The View from Teagasc: Before buying feed to meet a gap, you should consider the following questions

Do you need forage or a concentrates?
If you have less than half of the silage required on the farm, you will need to buy some forage. If you have at least half of the forage needed, then forage and/or concentrate can be used to make up the shortfall, depending on what’s best value and your feed space allowance.

What’s the difference between cost and value?
These two terms are commonly misunderstood. The total cost of any feed is the quoted purchase price, plus any costs incurred from the time of purchase to feedout. However, the value of a feed is what it is worth at a particular point in time, compared with other feed sources that could be used to replace it, again allowing for all the costs incurred until feedout.
In 2012, Teagasc recommended that grass silage (65 DMD) was worth up to €30/bale at 65 DMD but, this year, we suggest a value of €22/bale for the same silage. Why? The alternative feed source in this case is barley and it is up to 30 per cent cheaper this year,
therefore the value of the silage also reduces.

How should you value feeds?
In general, the value of feed is determined by referring to the cost of energy and protein feeds on the market. Teagasc uses barley and soya as the reference feeds, others use soya hulls and distiller’s grains. The end result is very similar.
Using barley and soya, the cost per unit of energy and protein is calculated and, from that, the value of feeds is generated. It’s important that feeds are valued based on local prices.
Teagasc recommends contacting your local adviser for advice or, alternatively, use the interactive calculator ‘Relative Value of Feeds’ that is on the Teagasc client site at www.client.teagasc.ie

How important is quality?
a) Firstly let’s define what quality means. With grass silage, good preservation is always important but the importance of dry matter digestibility will depend on the category of stock it is being fed to, for example dry suckler cows vs autumn calving dairy cows. There was a lot of hay made this summer. Many would say it is of very good quality. But what does that mean? Is hay that is well preserved with a nice smell and produced off a very old pasture (55 per cent DMD) as good as hay that is well preserved with a nice smell produced off a relatively new sward and 65 per cent DMD? Certainly, the latter is the better forage. This is where forage analysis and/or visual assessment of the ratio of leaf to stem is important.
b) Get forages/wet feeds analysed for nutritional value. For conserved forages, key parameters include preservation, dry matter, DMD and crude protein.
c) If it’s not possible to get laboratory analysis, get the history of the crop — sward quality (old pasture or reseed?), when was it last grazed, cutting conditions and so on.

What is the dry matter?
The dry matter of feedstuffs can vary enormously and this can have a major effect on the value of feeds; for example, if you are buying a wet feed at a quoted price and dry matter of €100/tonne and 50 per cent DM, respectively. This feed is costing €200/tonne of dry matter. However, if that feed is only 45 per cent dry matter, the cost is €222/tonne DM or 11 per cent more than initially thought. You are still only paying €100 per tonne but a bigger proportion of every tonne is water (550kg water per tonne vs 500kg water per tonne).

Therefore, always compare feeds on a dry matter basis. If you are getting a number of deliveries over the winter, it is good practice to measure dry matter regularly.

How much wastage will there be in storage?
Don’t ignore the wastage associated with stored feed. This can vary from 2 per cent losses for stored grains to 25 per cent losses for a standing crop of grass silage from standing until feedout.

What risks are associated with buying a particular feed?
Is the feed that you are buying of consistent quality? Barley straw in 2013, as in most years, is likely to be of consistent quality. However, baled silage can be of very variable quality and is commonly referred to as ‘lucky bag’ silage. Likewise, if growing a crop of forage rape, are you guaranteed a good yield and quality, compared with buying straw meals to fill the gap? The meals plus straw is a less risky option.

What is the cost of money?
Cashflow is tight on many farms this year, given the difficult weather conditions; expenditure on feed must take the cost of money into account. If you buy a feed today and it’s not going to be fed for six months, there is a cost on that money

Do I buy on a per acre or per tonne basis?
If you are buying a standing crop of any forage, it is important to buy it on the basis of yield, not acreage. You wouldn’t buy ration from the local merchant without weighing it before leaving the yard. It should be no different when buying forages. Buying on a per acre basis is fraught with error. Likewise for silage bales, there is significant variation in weight and dry matter content.

Am I taking all costs into account?
Costs incurred after buying any feed include storage
costs; transport costs; storage losses; capital costs (ie borrowed money tied up in feed that may not be fed for several months); storage treatment costs (for example acid treatment); processing costs (for example rolling); balancing for protein and minerals and storage losses and labour/machinery costs for feedout.

Table 1: Value of feeds relative to barley at €200/t and soya at €430/t on an energy and protein basis

Feed Value €/t

Soya hulls 201
Citrus pulp 185
Beet pulp 195
Maize gluten feed 224
Distillers grains 250
Rapeseed meal 259
Grass silage 72 DMD pit 28
Grass silage 67 DMD pit 25
Grass silage 72 DMD bale 25
Grass silage 67 DMD bale 22
Hay 55 DMD 24
Hay 65 DMD 29
Barley straw 12
Fodder beet harvested 35
Sugar beet harvested 43
Maize silage 25% starch harvested 43

By Siobhan Kavanagh,
Teagasc Nutritionist, Agricultural Grassland Research and Innovation Programme

Image O’Gorman Photography

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