What are the 7 key characteristics of a highly-profitable dairy farmer?
The expansion of the national dairy herd has paved the way for dairy farmers to increase their margins in recent years. The abolition of the milk quotas coupled with better systems has allowed dairy farmers to increase their farm’s bottom line.
Speaking at Irish Grassland Association’s (IGA) Dairy Conference – which took place earlier today in Co. Cork – agricultural consultant and land agent Mike Brady outlined that a high-profit dairy farmer earns more than €100,000 profit/year.
During his presentation, which was titled ‘key characteristics of highly-profitable dairy farms’, he highlighted that this figure is based on a 40ha holding.
This is the national average size of Irish dairy farms milking 100 cows and achieving a net profit based on Teagasc Moorepark research figures of €2,500/ha.
According to Brady, there are seven key characteristics a highly-profitable farmer has in order to successfully achieve this level of financial performance.
- They own or farm a lot of land (scale);
- They know their system of milk production;
- They are financially savvy when it comes to making investments;
- They have good leadership skills;
- They run a technically efficient system;
- They have a good team around them to run the farm;
- They balance personal values.
Speaking on scale in particular, Mike said: “The more land farmed – with low levels of debt – the more money the farmer will make. The only farmer that will go broke farming more land is an inefficient one.
“Usually, technical efficiency is top of the list at most conferences, but I’ve placed it fifth on the list based on the following.
“It is not difficult to make a profit in dairy farming. However, to make the top money you need to be technically efficient,” he added.
He indicated that grass production and its utilisation are important technical parameters, but animal breeding is what separates the top farmers from the rest.
High-profit farmers know the cows that drive profit in their system.
Mike highlighted the importance of work-life balance on Irish farms, particularly in this expansion phase that the national herd is currently experiencing.
“Dairy farmers are full of ambition and pride which is good. However, the work life balance must be right,” he concluded.