The question facing many farmers ahead of the maximum stocking rate (SR) under the derogation dropping to 220kg of nitrogen (N)/ha, is what to do?
2024 is going to one of the biggest years for the Irish dairy sector since 2015, when quotas were removed.
Unlike the removal of quotas, which has seen significant growth in the dairy sector, this change is likely to have the opposite effect.
Speaking at the Teagasc national dairy conference, Minister for Agriculture, Food and the Marine, Charlie McConalogue, said that the government is committed to maintaining the nitrates derogation past 2025, and that he believes dairy production levels can be maintained.
He also spoke about how dairy farmers effected by the drop in the derogation need to explore options on an individual farm-level.
This includes the option of exporting slurry, with significant grant aid now available for farmers to take in slurry.
Derogation
The exporting of slurry appears to be the chosen path by the government, which is sometimes viewed as the easy option.
In reality, it is not the easy option, as there is high cost associated with exporting this slurry off farm.
When the cow eats grass, or it is harvested for silage, nutrients are removed (N), phosphorus (P), and potassium (K).
After being eaten by the cow, nutrients are excreted onto the land or into tanks on farms in the form of slurry – making this a valuable fertiliser source on farms.
The figure generally used by Teagasc, is slurry has a value of 9-5-32/1,000 gallons of slurry, but there is great variation between farms and even tanks on farms.
With the average for Teagasc/Dairygold suppliers based on research outlined at the dairy conference being 10.7-5.3-27.
Covered tanks on this farms averaged 11.9-5.9-29, while open tanks averaged 7.8-4.1-23.
As highlighted previously by Agriland, for some farms going the exporting slurry route solely would result in significant amounts of slurry and/or nutrients leaving the farm.
The biggest issue with exporting slurry is the fact that the N content of the slurry has been reduced from 5kg/t to 2.4kg/t by the Department of Agriculture, Food and the Marine (DAFM) under nitrates regulations.
Taking an example of a farm of 50ha that is stocked at 245kg of organic N/ha, this farm from next January, would then be exceeding the legal limit by 25kg/ha or 1,250kg of N over the whole farm.
The conversion rate is that 1t equates to 1m3 or 1,000L of slurry, meaning this farm would need to export 521t of slurry (521,000L) of slurry to get below the new maximum stocking rate of 220kg of N.
A dairy cow produces 0.33m3/week according to DAFM. Basing this off a 18-week storage requirement, this means that one cow would produce 5.94m3.
So, for this farm to meet the reduction to 220kg by exporting slurry, it would be the same as exporting slurry from 88 cows.
Cows numbers vs leasing
The other options remaining for farmers is the dropping of cow numbers or the leasing/purchasing of more land.
Starting with the dropping of cow numbers, you will have a drop in milk sales and calves sales.
You will also have a drop in viable costs and feed costs. Purchased concentrate feed costs should drop, but you should also be able to feed less.
Less cows on the milking platform means that there is more feed available for cows on the platform, so the need for concentrates should be reduced.
Depending on cow numbers, you mightn’t see as big of a drop in milk production as expected, less competition for feed should see production from individual cows increase.
Taking the option of leasing land, you have the added cost of leasing the land – but as pointed out by Teagasc only around one third of cost of leasing land is the actually land rental charge.
Land at €350/ha is really costing in the region of €1,050/ac.
Similar to decrease cow numbers example, you will also have a drop in feed costs. More forage available to the farm should mean the need for concentrates should also drop.
The option that is best going to suit your farm needs to be determine by doing the calculations for your situation.
In some situations, reducing cow numbers may be more profitable, while for others, leasing land is going to maintain or increase farm profitability.
The question now ultimately comes down to what option is going to suit your farm from a economic sustainability point of view.