More milk from fewer cows

New Zealand milk production is up while cow numbers are down:

Daisy and her paddock mates are record-breakers, reveal the latest national dairy statistics released today by DairyNZ and LIC.

Over the 12 months to June 2017, the average dairy cow produced more litres of milk containing more kilograms of milksolids than ever before.

The average dairy cow produced 4,259 litres of milk in the 2016-17 season, containing a total of 381kg of milksolids (kg MS), compared to 4,185 litres and 372kg MS in 2015-16.

The latest New Zealand Dairy Statistics 2016-17 also reveal milking cow and herd numbers have decreased for the second consecutive year. The latest count is 4.86 million cows nationally – down from 4.99 million in 2015-16 – while herd numbers have dropped to 11,748 from 11,918 (-170 herds).

But despite the decline in cow numbers, dairy companies processed very similar milk quantities – 20.7 billion litres of milk containing 1.85 billion kg MS in 2016-17. The previous season was 20.9 billion litres of milk (1.86 billion kg MS).

The results are positive for New Zealand and its farmers, says DairyNZ and LIC.

DairyNZ senior economist Matthew Newman says the trend for increasing per cow milk production shows farmers are opting for animals that are year-on-year more efficient at converting grass into milk – the industry’s national breeding objective.

“We are producing similar milk quantities from fewer cows, partly because we are breeding better animals and feeding them well,” says Matthew.

Since the 1980s ag-sag sheep numbers have dropped but meat production hasn’t.

Cow numbers have increased in recent years as more farms converted to dairying but now dairying is following sheep with more production from fewer animals.

“The average herd is now 414 cows, down from 419 in 2015-16. Currently we are at the lowest level of cows milked since 2012 – with North Island cow numbers declining 90,000 to 2.89 million, while South Island numbers decreased 46,000 to 1.97 million.”

LIC general manager NZ Markets, Malcolm Ellis, says the stats reflect a shift in the industry.

“Farmers are acknowledging that, as an industry, if they are not going to be milking more cows then they need to be milking better ones,” says Malcolm.

“The lower payout in previous seasons certainly forced some farmers to reconsider their cow numbers as part of a wider farm system review, but these stats prove it can really payoff for a farming business.

“It boils down to the fundamentals of herd improvement – creating high quality herd replacements that will out-perform their mothers in productivity, longevity and fertility.” . . 

It’s a matter of improving production rather than increasing cow numbers.

Doing more with less is better for staff, the environment and income.

Sharemilking structure

Farm ownership structures have also changed over the last couple of seasons, with 27.3 percent of New Zealand dairy herds operating under a sharemilking agreement in 2016-17, compared with 32.4 percent in 2014-15.

Within the sharemilker herds, variable order sharemilking (VOSM) herd numbers declined in 2016-17. In particular, 20-29 percent sharemilkers decreased by 235 herds (-29 percent) to 586. In 2013-14, there were twice as many VOSM herds compared to today (1,357).

Herd-owning sharemilkers (50:50 sharemilkers) declined (-91 herds) for the fourth consecutive season and now account for 19.8 percent of all herds.

Owner-operator herds increased 188 to 8,503 herds in 2016-17, reflecting VOSMs moving to contract milking after financial challenges with low milk prices. . .

Sharemilking started in New Zealand, where it’s governed by an act of parliament, and is rarely used elsewhere.

A reduction in numbers of sharemilkers isn’t good for the medium to longer-term health of the dairy industry.

It has always been a way for dairy workers to get on and up the ladder to farm ownership.

We used to have managers but changed to lower order sharemilkers several years ago.

The change has been better for animal health, staff and production.

Sharemilkers have skin in the game. The better they do, the more they make and that incentive works to get the farms working better.

For the sake of the industry I hope that the reduction in the number of sharemilkers is temporary.

 

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