Grass utilisation on farms remains the key driver of farm profitability and sustainability on Irish dairy farms.
2022 was a record year, not only for milk price, but also for concentrate prices on farms.
Although in many cases the higher milk price offset the extra cost of inputs, it appears that some dairy farm lost sight of their targets.
Speaking at the Teagasc national dairy conference, Dr. Joe Patton, head of knowledge transfer with Teagasc, outlined a comparison of 100 farms between 2019 and 2022.
For the analysis, the labour costs and land lease charges were excluded from common input costs.
The data shows a significant increase in the cost of production on the 100 farms used for this analysis increase by €554, with €478 for variable cost and €76 increase for fixed costs.
Source: Teagasc
Due to the significant risk in milk prices since in 2022, there was an increase in margin/ha of €2,153 between the two years.
Grass utilisation
Although much of the increase in cost can be associated with rising cost of production due to uncontrollable issues, there was some worrying signs within the analysis.
Based on the data concentrate feeding rates increased by 271kg/cow, while fertiliser usage decrease by 19kg/ha.
Image: Teagasc
Commenting on the figures within the analysis Patton said: “We can’t expect to take the equivalent of half-a-ton of dry matter (DM)/ha out of our current system, hold stocking rates the same and expect everything else to be the same.
“The point is that people reacted to the high fertiliser prices by using less, and reacted to high concentrate prices by feeding more.
“Part of me thinks that there was a very strong prevailing argument within the industry, that because milk price is high, we are going to get a windfall response to the concentrate fed, and it turned out we go very little at all.”
Patton noted that although milk solids/cow increase by 14kg, that when genetic improvement were taken into account that the extra 271kg of concentrates only increase milk solids by 8kg/cow.
“The problem is, we lost a little bit of focus on pasture utilised, because of high milk price.
“What we are saying is that, if milk price goes to 80c/L next year, don’t respond to that by increasing supplement for marginal milk.
“Respond to it by ignoring it almost and focus still on pasture utilisation,” Patton said.