Pasture-only farm most profitable in first year of trial

The Reduced Reliance on Imported Feed Trial is testing how two dairy production systems using all home grown feed (grass-only farm and cropping farm) compare to a system using palm kernel expeller (PKE farm).

In the first year milk production was highest on the cropping farm at 1049kgMS/ha compared with 870kgMS/ha on the grass-only and 1028kgMS/ha on the PKE farm.

However, at a $3.90/kgMS payout, the grass-only farm had the highest operating profit at $821/ha, slightly above the PKE farm at $788/ha.

The cropping farm was less profitable than the other two at $446/ha.

Allowing for the cost of capital on each system, the grass-only farm was still the most profitable at $789/ha, followed by the PKE farm at $626/ha and the cropping farm at $300/ha.

The Northland Agricultural Research Farm near Dargaville is run with the Northland Dairy Development Trust; sponsors include DairyNZ, the Ministry for Primary Industries and the Hine Rangi Trust.

A recent briefing on the first year of the trial which started on June 2, 2015, said the kind weather and low milk price favoured the grass-only farm, where the lower production was compensated by the lower farm working expenses.

"These results may vary in a more challenging season," says a summary report on the work. "Based on this year's trial results, if the milk price had increased to $5.50 or $7/kgMS, the PKE farm would have been slightly more profitable than the other two farms."

Good weather throughout the 2015-16 season resulted in good pasture growth and covers on all farmlets for most of the season. As a result, supplement use was significantly lower than expected on the PKE farm at 469kg/cow. Crops were grown on the cropping farmlet: 23% of the farm area was in turnips, fodder beet and maize (silage).

Crop establishment was excellent but some yields were disappointing. Turnip yield was estimated at 9.0 tonnes DM/ha, fodder beet 15.5t/ha and maize silage 22.0t/ha.

The background to the trial is that New Zealand dairy farms have come to rely heavily on importing feed.

"There is widespread concern in the farming community about what could happen if this feed became unavailable due to lack of supply, market pressures or food safety concerns. Increased levels of imported feed have driven up farm working expenses, making farm systems vulnerable during seasons with lower payout," the summary says.

Loss of imported feed would hit the productivity of NZ dairy farms in the short-medium term.

The research questions being addressed are:

· How can Northland dairy farms best maintain production and profit with reduced imported feed?

· How do we replace imported feed with extra forage grown on farm?

· How do we manage the effects of climatic variation with reduced reliance on imported feed?

Trial structure

The trial compares three farmlets:

1. Grass-only farm - No imported supplement, home grown grass silage may be used. Stocking rate of 2.5 cows/ha (71 cows calving on 28ha)

2. Cropping farm - No imported supplement, crops grown on farm (about 2ha turnips, 2ha fodder beet and 2.5ha maize silage). Stocking rate of 2.7 cows/ha (78 cows calving on 28ha)

3. PKE farm - Importing PKE as required to optimise profit from pasture. Stocking rate of 2.7 cows/ha (78 cows calving on 28ha).