Tips to add value to calves and stores at market
Preparing and presenting calves for sale in peak condition is one of the keys to success on Philip Heard's 700 acre moorland farm near Okehampton in Devon, and this - together with a variety of efficient management procedures - has not only earned Mr Heard the title of Farmers Weekly Beef Farmer of the Year, but has also created a commercially thriving business.
"My principal aims are to get as much growth as possible in the calf in the first 200 days, to get the cow back in calf again and to present an animal in the market that other farmers wish to buy," said Mr Heard.
Preferring to sell at a livestock market which will realise the 'true value' of stock, Mr Heard believes that if he has done his job correctly, the cattle should sell themselves. He offers the following advice to add value to cattle as they go to market.
- Plan ahead to target a particular sale, and supplementary feed the cattle so they are looking at their best when sold.
- Sell at the bigger catalogued sales specific to your type of cattle, as more buyers attend which creates competition.
- Put a good description of the cattle in the catalogue such as breed, age, single suckled, FABBL, creep fed and vaccinations.
- Present the cattle well. In markets buyers buy what they see, so clean cattle with tails clipped give the impression that they are well cared for.
- Sell cattle together that are similar in appearance.
- Sell in good sizes groups - they sell better in bunches of four to eight.
- Sell large numbers (40-80) at each sale, as having a long run creates your own trade, with the last cattle often making more than the first.
- Produce quality - even in a bad year, quality will always sell.
- Finally, in the long term you will create a name for yourself for producing fast-growing quality cattle that buyers are prepared to pay extra for, and will look to buy each year.
Will intensive or extensive dairying prevail in the future?
Low input for less stress, lower costs and greater efficiency
Sixty inches of rainfall in a location between Dartmoor and Bodmin would test the measure of any extensive dairy farming system but Bill Jewell has no doubt that this is the way for the future.
With a background in intensive farming (he formerly managed a 10,000 litre herd) he believes that less stress on staff and cows helps make low input an economic option on the two units he runs - totalling 1,000 milking cows over 1,890 acres (765 ha). Backing up his claims with production costs of 23.20ppl, this leaves a satisfactory margin from the 28.78ppl paid for the milk.
"But whilst the grazing system might appear simple and require little management, it does in fact require a great deal of input," said Mr Jewell, who measures swards weekly to predict growth rates and assess the grass cover on the farm every day.
"This is managed so that the cows have access to high quality grass at the right growth stage to facilitate intakes of 14-18 kg of dry matter per cow per day," he said. Forage planning begins in the autumn, with swards shut up for the following spring from 10-15 October with a closing cover of 1,500kg.
"Although growth rates are relatively low during the winter, the grass does grow almost every day and this should result in a sward with approximately 2,200kg of cover per hectare that will facilitate turnout by mid-February," said Mr Jewell.
Managing the grass in this way means that only 4.2 tonnes of silage per cow per year needs to be made for the 4,500 litre Jersey and black and white cross herds. Farm machinery is kept to a minimum, heifer rearing is out-sourced, lameness is said to be 'a thing of the past', and mastitis is down to nine and 13 cases per 100 cows in each of the two herds.
With a realistic target of reducing costs to under 20ppl through production efficiencies, lower concentrate usage and increased stocking density, Mr Jewell is convinced that the extensive system offers the best long-term prospect for profit.
Only high input systems can meet consumer demands
Richard Rhone, farm manager at Drax Farms in Wareham, Dorset believed the crux of the higher input argument rested on the need for a level supply profile.
"Grazing cows is probably the cheapest system," he recognised, "but we all want fresh milk on the shelves every day."
This, he believed could only be supplied by relatively high output farming, which could also satisfy the volume required to assure milk and milk products were always on the shelves.
As a supplier to Waitrose, he said the herd's 400 cows were managed to produce milk for the maximum number of days in their lactation, which gave them an average of 42 days dry. And despite the relatively intensive system averaging 9,000 litres, the cows were kept outside as much as possible. This was not only considered important for the herd, but was also felt to be essential in improving the image of high input farming, which was more likely to receive criticism from consumers.
A dialogue between the farm and the buyer was essential for their long-term relationship, allowing both the supermarket to understand the farm's problems and to convey a favourable image back to the consumer. With a milk price of 28.46ppl and total costs of production of 25.58ppl, Mr Rhone felt that his system had a long-term future.
Citing other advantages of the higher input system - including a lower carbon footprint per litre of milk and the opportunity to diversify into energy generation through anaerobic digestion - he said that these had the potential to add favourably to consumer perception.
"However, if we do not communicate that to the consumer in conjunction with the retailer then misunderstanding of the system will cause the system to be non-profitable and all the hard work of the farmer to produce a good product will go to waste," he concluded.
Grass-based systems offer the best prospect of sustained profits
There's a possibility that high output milk production provides a return for everyone except the farmer, said Mike Houghton from Andersons, positioned as an impartial consultant between the intensive and extensive farmers during the conference's 'profit hour'.
And it was, above all, the intensive systems' higher capital outlay as well as their higher costs of production per litre which informed his view that lower input, grass-based dairying was more likely to prosper into the future.
Behind these assumptions were changing UK and worldwide trends, including growing international demand for grain and significantly rising (albeit easing) input prices.
The effect of these trends could be seen in costs of production for the year ending March 2008 averaging 20.5ppl in low output herds (6,000 litres and under) and 25.8ppl in higher output herds (9,000 litres and over).
Assuming a milk price of 27ppl, these costs left a margin of 6.5ppl and 1.2ppl for the low and high input situations respectively, which would require just one million litres (equivalent to a low input herd of 167 cows) to produce a surplus of £65,000 (pre-rent and finance). However, for the higher input herds, with a 1.2ppl margin, some 600 cows averaging 9,000 litres would be required to achieve the same surplus.
"The total annual expenditure for a 600 cow dairy unit is likely to be in the region of £1.4m against £200,000 for a 167 cow unit," said Mr Houghton. "So in whose interest is it to support high output farming systems?"
Adding that the low input system had a payback period of 13 years, while the high input system would not generate a return on investment in the first 20 years, he said that this was even the case if a 1ppl milk price differential is assumed, to allow for a volume bonus.
"In fact, to achieve the same level of return, the high output system requires a minimum price advantage of 4ppl," said Mr Houghton.
"The quantum is enormous, and the lower the milk price goes, the more pressure there will be to get back to a grazing system," he said. "It also gives an indication of why grazing systems are in vogue in low milk price regions of the world."
However, despite a trend for milk production to move towards the grass growing areas of the west, he said the UK was still well placed to practise almost any type of dairy farming, and that both systems, if managed to their optimum, had the potential to achieve a satisfactory profit.
"And some people have found an effective middle ground," he added, "but nevertheless I believe my figures illustrate that with the price cuts announced recently, many dairy farmers may well be reviewing their options, particularly if they can utilise grass more effectively."
But with a final thought towards the national requirement he added: "If total milk output is the main objective, it would require 50% more cows managed in a low output system to match the output of an intensive system."
With a greater appreciation of the value of grass, he said the UK dairy industry had significant potential to exploit grass and grazing based systems to a far greater extent, and should be uniquely placed to become one of the most profitable dairy industries in the world.
US trends and technology from which the British could learn
British dairy farmers may not have the same problems as those in America, but there is much they can learn from Stateside trends, according to Brian Bolton, chief executive of Allflex USA.
Better known as former manager of Oxfordshire-based Watergate Holsteins, Mr Bolton described how the American dairyman's response to both a good and bad milk price was always the same - to add more cows.
As a result, the average dairy herd has grown beyond recognition, seen in the extreme in California (average herd size 778) and New Mexico (average 825) and increasingly in herds of 3,000 to 6,000 head.
But the move of dairy units had been inexorably away from the centres of population and towards the feed-growing regions, and the massive enterprises which result often attract the infrastructure to support them in previously non-dairying areas.
The challenges faced ranged from the political (no political opposition from the state) to the physical (most importantly the availability of water) and importantly included coping with demographic change.
"You are no longer managing cows, you are managing people, and old management techniques often no longer apply," said Mr Bolton. "Many people don't want to work the long hours in difficult conditions dairy farmers take for granted and in the USA this has led to an imported, largely Hispanic labour force."
Emphasising the importance of adapting to the Hispanic language and culture, he went on to describe how some employers had problems with recruitment while the lengths others went to in order to attract and retain staff included building a football pitch, persuading the local priest to conduct mass in Spanish, and learning the language.
The genetics required to sustain the largest scale herds had a 'surprisingly large emphasis on conformation' while uniformity was also 'a premium trait', said Mr Bolton.
"There has always been a need for sustainability in a large herd where individual attention is a luxury, and the need for sound udders, legs and feet and strength to survive is a paramount breeding goal."
Although frailty was avoided, size was not considered important; the showring was irrelevant for breeding although provided a social and teaching role; and large herds widely used computer aided breeding programs.
However, it was the management and identification technology adopted by the largest herds which caused the greatest interest amongst farmers at the conference, increasingly based on Radio Frequency Identification (RFID), allowing the herdsman to rapidly identify the cows needing action and logging their status on a hand-held device.
"RFID disposes of transcription errors by eliminating paper action lists; reduces labour and increases compliance of, for example, drug and management protocols, leaving no question that this cow got this drug on this day," said Mr Bolton.
Cows are also processed in a fraction of the time of a paperbased system and the monitoring of labour is also improved. "You know who did what when and how well," said Mr Bolton.
"Typical return on investment is measured in months and consequently it has become a great example of rapid technology uptake with today some 2.5 million dairy cows - or 30 per cent of the national herd - having an RFID tag."
Beef lots could spring up in the north east
US-style beef lots could spring up in the north east of England once two major bioethanol plants come on stream from summer 2010. The first plant to come into operation will be the Vivergo factory in Hull, which will produce a co-product of around 500,000 tonnes of Dried Distillers Grains with Solubles (DDGS) per annum, for which the companies behind the plant will be looking for an outlet.
The other plant, in Teesside, would have a similar capacity.
This message came from Richard Whitlock of Frontier Agriculture, the company contracted to supply wheat to the Hull plant. He said that all co-products from the biofuels industry were high protein animal feeds which were particularly suited to ruminants and that there was a 'significant opportunity' for local farmers to develop uses for DDGS close to the factory.
From the Vivergo plant, DDGS would be supplied either dried, or as moist grains which would ideally be used close to the plant.
Commenting that KW Trident has been appointed as sole sellers of DDGS from Vivergo, he said that there will be no major seasonal changes to output, with DDGS available throughout the year.
"Given farmers' natural entrepreneurial spirit, it would not be surprising to see several large scale cattle feeding lots being created in the Hull area," he said.
The need for expensive imported inputs such as soya could also be replaced by the 33% crude protein DDGS, which could equally displace some Scottish distillers grains used in the region.
"Some cattle farmers could change from processing and consuming their wheat harvest to selling a proportion of their wheat and buying in DDGS," added Mr Whitlock. "And nutritional development might also improve the usage in a broader range of feeds."
Concluding on a note of optimism he said: "Not only will cattle farmers have a local source of high protein feed but they will not be subject to the vagaries of international freight rates, exchange rates and trading levies."
One hundred years of pedigree black and whites
Launching Holstein UK's centenary year at the conference, communications manager, Simon Gee, said there was no such thing as one type of black and white cow that would suit all requirements.
"Breed a cow that suits your system," said Mr Gee, "and don't blame the breed if the cow you end up with is not what you can make best use of."
Advising breeders not to follow fashion, which 'may look good today but could make you look foolish tomorrow', he said the industry had been through various trends of 'too small', too dumpy' and 'too frail' but that the breeder today had a robust progeny testing system at his disposal through which to make the best possible choices.
Chronicling the highlights of the past 100 years, he concluded with leading British and international black and white sire, Picston Shottle, which he said exemplified the current decade and had put UK breeding back on the map.
Dairy industry at tipping point but there's reason for optimism
Confidence must be stimulated in the dairy industry before it is too late, said NFU president, Peter Kendall as he addressed an audience of largely dairy farmers on the second day of the conference. And that was likely to involve finding a 'better way of doing business'.
Failure to do so could erode the industry's critical mass as farmers continued to leave the dairy sector and factories ran at less than capacity, eventually leading to closures.
His call came in the face of a succession of negative pressures on dairy farming including falling commodity prices; unstable milk prices; the need for investment in the face of NVZs; and a significant increase in TB which would reduce milk output by '16 million pints' in a year.
With government facing spending of nearly £80 million a year on TB compensation and testing, he said the NFU would continue to have 'no stomach' for their cost and responsibility sharing proposals and would continue to call for an independent body to make science-based decisions, so removing politics from matters of animal health.
Regarding recent price cuts to milk, he said: "When I look at the demand for fresh milk in the UK, there's no reason why we should have seen large processors putting prices down and blaming it on commodities."
With the range of negative pressures he cited fuelling a continuing decline in milk production and pulling in imports from Northern Ireland and elsewhere in Europe, he said: "This tells me we are at a tipping point."
Yet despite the negative influences, Mr Kendall found cause for optimism and said processors were now asking 'where's the milk?' while customers saw the need to stimulate confidence, before it was too late.
Highlighting the need for transparency, accountability and trust between buyers and sellers, he said that dedicated supply chains offered a better way of doing business. Accepting they may add costs, he also believed they brought farmers closer to their markets and retailers closer to farmers.
"They create a climate of responsibility in which pricing can be separated from commodity markets," he said.
Driving down prices he said would do irreparable long-term damage, and the NFU was working on 'template contracts' in response to recent milk price cuts made retrospectively. Signs from government he believed offered some encouragement, with the need for food security at last, recently acknowledged. In the face of the economic crisis he said that agriculture had the opportunity to become an important part of the economy that government should cherish and support.
"There's an opportunity to put agriculture higher up the political agenda and to have a brighter future for the industry," he said.
Rosy outlook for rosé veal
The problem of the Holstein bull calf has been turned on its head by Linden Foods in Northern Ireland, whose recently launched Slaney Valley Rosé Veal has channelled the black and white by-product of dairying into a lucrative outlet.
"If the Dutch could import calves from the UK and Ireland and export the rosé veal and make a return, then surely Linden Foods should be fit to do the same, because we had the raw material in the form of calves locally," said Linden's Frank Foster, explaining the founding principles.
After extensive research of the European market, and a generally lukewarm reception from farmers, the company opted to guarantee dairy farmers a price of £80 for calves at 7-8 weeks. Equally, they agreed to finance the calves as they moved on to finishing units, recouping the money at slaughter.
"It was obvious from the outset that the diet was going to be of the utmost importance if the desired carcase weight, meat colour and fat class were going to be achieved before the calf reached 12 months of age," said Mr Foster, as he described the initial carcase weight target of 190kg and 220kg, with at least a fat class 2.
But early performance indicated that Linden's prime cuts were generally larger than those favoured across Europe and targets had to be revised.
"Our aim was then to try and produce lighter and younger carcases with the same fat cover," said Mr Foster, "and in order to do this, the animal would have to grow at a faster rate for the duration of its life."
The particular challenge was to increase the energy levels of an already high-energy ration while avoiding the risk of acidosis.
"We can now produce very suitable carcases with an average dead weight 206kg with a fat class of 2," said Mr Foster. The average slaughter age of these animals is now ten and a half months.
Despite the existence of challenges - most notably the management of pneumonia - the current gross margin per head for finishers is around £90.
Other challenges include developing a domestic market for rosé veal and overcoming new EU legislation which states that in the UK, rosé veal over eight months old must be labelled 'young beef'.
"Some batches of calves are being fed new diets to establish if we can produce suitable carcases at under eight months," said Mr Foster.
With an unequivocally optimistic outlook and a company which is now killing 180 head a week, he explained that securing a sustainable supply of black and white calves was now a priority.
Effective control of IBR
According to Intervet/Schering-Plough Animal Health ruminant veterinary adviser Rosemary Booth MRCVS, many European countries - including Scandinavia and Austria - have been declared IBR-free and others (such as Germany and Hungary) operate national eradication programmes.
"In the UK we are some way behind some of our European colleagues in terms of controlling what has become a widespread and costly viral disease in this country. Recent bulk milk and blood screening of a nationwide sample of our herds revealed 72% testing positive for IBR - a situation that compares poorly with other EU countries, such as Holland, where exposure levels are reported to be below 10%," she says.
The widespread use of live marker vaccines such as the marketleading product, Bovilis IBR Marker Live, has helped many continental European cattle producers control IBR effectively. In Holland, for example, where great strides have been made towards disease eradication, live marker vaccines account for over 90% of IBR vaccine use. The main use of inactivated vaccines is in regions where eradication is almost complete - a situation we in the UK are far from reaching.
For UK producers looking to export cattle or semen, the roll-out of live marker vaccine will certainly make life easier for our industry as use of vaccine is determined by rules in the destination country. But even if you are not exporting livestock, IBR control is imperative purely on financial grounds.
"The cost of this disease is potentially enormous," Ms Booth says. "Studies have shown that, for dairy herds, IBR infection can depress milk yields by 173 litres per affected animal. But that's only the tip of the iceberg - growth rates in replacement heifers and beef cattle can also be severely depressed. In addition, animals can die from IBR, easily pushing losses into the £'000s for some herds badly hit by a disease outbreak.
"With a disease like this where the potential financial losses are so great, vaccination is a must. Disease prevention is quite straightforward, with live IBR marker vaccine able to be administered intra-nasally or intra-muscularly from two weeks of age. Vaccination may also be advised by a veterinary surgeon to help tackle a disease outbreak because the vaccine produces immunity in the upper airways, which helps the animal kill the virus.
"In addition, the marker live vaccine can be administered to healthy cattle alongside the pneumonia vaccine Bovilis Bovipast RSP, helping to reduce handling. A booster is then required every six months thereafter," she advises.
It is important to recognise that once exposed to the IBR virus, cattle remain carriers for life. Unlike other significant diseases such as BVD and Johne's, IBR remains dormant in the animal until stress factors such as calving, stock movements or extremes of weather trigger recurrence of clinical signs of the disease. Once symptoms appear, an affected animal can shed large quantities of the virus from the airways and nose, which means uninfected herd mates will always be highly vulnerable to infection. The IBR virus can also survive in the environment, further increasing infection risk.
Rosemary Booth explains that vaccine use reduces the amount of virus excreted into the environment, so minimising the risk to stressed cattle which may have been brought into the herd and be latently infected. She also points out that marker vaccines are also the right choice for producers with breeding bulls, although the bulls themselves should not be vaccinated.
"Bulls entering AI stations or producing semen for sale cannot have antibodies to any IBR virus at all, so they must be protected from infection rather than be vaccinated," Ms Booth stresses. "But using the live marker vaccine on females in the herd minimises virus circulation and the number of infected animals on the unit. This approach gives the bulls every chance of staying free of infection.
In the longer term, being able to distinguish a vaccinated animal from one that has been exposed to IBR naturally - or one that is naturally free from infection - will be a significant benefit for any producer wanting to move towards disease eradication. As diseasefree accreditation may yet arrive in the UK, the wholesale move to marker live vaccine makes sound commercial sense.