Drought, high feed prices and low milk prices challenging Australian dairy farmers

By Jack Kennedy

When the home farm in Derbyshire, England was sold almost 30 years ago, moving to Ireland was never on Alan Jefford's mind. "It just rains too much,'' he explained. Instead he decided to move to the land of opportunity at the time, Australia. Alan Jefford is dairy farming with his son at Cloverlea, Gippsland, one hour east of Melbourne in Victoria - home to the vast majority of dairy cows in Australia. Jack Kennedy bumped into Alan at the foot of Slievenaman last week and he talked about dairy farming in Australia.

JK: Why the move to Australia and not Ireland?

AJ: We wanted a place where we thought we could raise our three children well. Ireland is a beautiful country but you need to house your cows and it just rains too much.

JK: How many cows are you milking in Victoria?

AJ: We are milking 200 cows on average all year round. We could of course grow in scale as much as we like but we feel if we can produce milk from 200 cows efficiently then we will be more competitive in the long run.

JK: Who do you supply and what news of milk price?

AJ: We are supplying a factory called 'Burra Foods' who export most of milk processed as a concentrate to America and Japan. We have just come through two years of very reduced milk prices and our price has averaged AUS$34 c/l (€21 c/l). It costs me over half of this to produce a litre of milk. We are paid on fat and protein only. Protein is three times more valuable than fat.

JK: What breed of cow is most popular?

AJ: By far and away the most popular are the Holstein Friesian but the Jerseys have increased in popularity significantly in the last few years. I prefer a more British Friesian/Dutch Friesian type animal. You get a smaller calf and no damage to heifers. Fertility is better and longevity is good.

JK: Tell me about starting off in Australia 30 years ago?

AJ: In 1980, we flew out 24 heifers and one bull from Derbyshire. This was to form the nucleus of the herd. In 1982, we flew out seven more heifers and one bull. Shipping was not permitted due to disease regulations between countries. Since then we have been importing semen from all over the world. Since I arrived in Ireland, I have bought semen from Dovea Genetics. I used to buy semen from Dovea when I was in England and this year have bought straws from Dovea again. This year i have bought straws from TIH, SVD, ODR, SEX, SMZ, and IDS.

JK: Is your system grass or grain based?

AJ: We practise a grass based system with some supplement. Grazed grass, grass, and maize silage, with meal (one to 1.25 tonnes). We have over 435 acres in one block. Cows walk a maximum of two km.

Normally we strip graze 365 days a year. Rainfall average is 42 inches per year but we get as low as 28 inches in some years. Temperatures are pleasant in winter with lowest temperatures 13/14 o C and highs of 40 o C in the summer.

Our average stocking rate is one livestock unit/acre. Intensive feed systems are coming under financial pressure with exorbitant grain prices.

JK: What other stock do you keep?

AJ: We rear all of our own calves and buy in plenty more. We do all our own AI and sell surplus bulls and heifers. Stock bulls fit for service can make AUS$2,500 (€1560). Good dairy replacements are sold to China and we get a AUS$400 (€250) premium over the Australian market value. This means we can get up to AUS$1800 (€125)/head for replacement heifers at two years old. We often get buying delegations from China and Mexico. Stock bulls to China can make over AUS$3000 (€1875)/head.

JK: What are young calves making?

AJ: Good Friesian bull calves one week old are making AUS$100 (€62.50) to $125/head. Jersey bull calves are making AUS$25 (€18.00)/head. We start calving in February and continue until October.

JK: Buildings, Labour and the Environment?

AJ: We have a concrete feed face where we feed out supplement. Other than this, the cows are never inside. They are out all the time. Close to this we have a bunker where we store slurry scraped off the concrete. We use the Derbyshire weeping wall system to separate the liquid and spread the solids in the summer. We milk through a two man, 28-point rotary. Milking takes one and half hour comfortable. Environmental concerns are not an issue for us at the moment. My son works full time on the farm and we have one full time labour unit.

JK: Average production?

AJ: Averaging just over 8,000 kg/year at 3.48% protein and 4.5% fat.

JK: Are you making money?

AJ: Yes profitability is good even in downtime on milk price. This is very much due to the system we run.

We try to limit meal feeding as much as we can. Grain has become very expensive due to drought and last year we had a late frost that shrivelled crops. Crops that looked good did not yield well as a result. Wheat is retailing for $AUS230 (€143)/tonne and the protein crops around $280 (€175)/tonne plus depending if Soya, Canola, beans, peas or lupins. Labour is not a major cost for us. Good labour is very scarce.

JK: What is the biggest challenge facing Australian dairy farmers?

AJ: Irrigation is without a doubt the biggest challenge. The cities Sydney and Melbourne are demanding more and getting increased allocations of water every year. The poor farmer loses out. The last two years have been tough. Winter starts in Australia on 1 June and at the moment weather is very favourable over there. A lot of dairy farmers have left the industry in the last two years because of high prices for feed and the drought.

JK: Are you happy to have moved to Australia?

AJ: The best move I ever made. I have one son milking at home. My daughter is married to a local farmer and living three miles from the home farm. My youngest son is studying 'Oncology' (dealing with people with cancer), has more brains than his father and travels to conferences across the world. I plan business trips to Ireland as often as possible.

If people have other overseas contacts with Irish links that they would like to hear a report from, ring Jack Kennedy on (087) 9082651.

Drought, high feed prices and low milk prices challenging Australian dairy farmers

When the home farm in Derbyshire, England was sold almost 30 years ago, moving to Ireland was never on Alan Jefford's mind. "It just rains too much,'' he explained. Instead he decided to move to the land of opportunity at the time, Australia. Alan Jefford is dairy farming with his son at Cloverlea, Gippsland, one hour east of Melbourne in Victoria - home to the vast majority of dairy cows in Australia. Jack Kennedy bumped into Alan at the foot of Slievenaman last week and he talked about dairy farming in Australia.

JK: Why the move to Australia and not Ireland?

AJ: We wanted a place where we thought we could raise our three children well. Ireland is a beautiful country but you need to house your cows and it just rains too much.

JK: How many cows are you milking in Victoria?

AJ: We are milking 200 cows on average all year round. We could of course grow in scale as much as we like but we feel if we can produce milk from 200 cows efficiently then we will be more competitive in the long run.

JK: Who do you supply and what news of milk price?

AJ: We are supplying a factory called 'Burra Foods' who export most of milk processed as a concentrate to America and Japan. We have just come through two years of very reduced milk prices and our price has averaged AUS$34 c/l (€21 c/l). It costs me over half of this to produce a litre of milk. We are paid on fat and protein only. Protein is three times more valuable than fat.

JK: What breed of cow is most popular?

AJ: By far and away the most popular are the Holstein Friesian but the Jerseys have increased in popularity significantly in the last few years. I prefer a more British Friesian/Dutch Friesian type animal. You get a smaller calf and no damage to heifers. Fertility is better and longevity is good.

JK: Tell me about starting off in Australia 30 years ago?

AJ: In 1980, we flew out 24 heifers and one bull from Derbyshire. This was to form the nucleus of the herd. In 1982, we flew out seven more heifers and one bull. Shipping was not permitted due to disease regulations between countries. Since then we have been importing semen from all over the world. Since I arrived in Ireland, I have bought semen from Dovea Genetics. I used to buy semen from Dovea when I was in England and this year have bought straws from Dovea again. This year i have bought straws from TIH, SVD, ODR, SEX, SMZ, and IDS.

JK: Is your system grass or grain based?

AJ: We practise a grass based system with some supplement. Grazed grass, grass, and maize silage, with meal (one to 1.25 tonnes). We have over 435 acres in one block. Cows walk a maximum of two km.

Normally we strip graze 365 days a year. Rainfall average is 42 inches per year but we get as low as 28 inches in some years. Temperatures are pleasant in winter with lowest temperatures 13/14 o C and highs of 40 o C in the summer.

Our average stocking rate is one livestock unit/acre. Intensive feed systems are coming under financial pressure with exorbitant grain prices.

JK: What other stock do you keep?

AJ: We rear all of our own calves and buy in plenty more. We do all our own AI and sell surplus bulls and heifers. Stock bulls fit for service can make AUS$2,500 (€1560). Good dairy replacements are sold to China and we get a AUS$400 (€250) premium over the Australian market value. This means we can get up to AUS$1800 (€125)/head for replacement heifers at two years old. We often get buying delegations from China and Mexico. Stock bulls to China can make over AUS$3000 (€1875)/head.

JK: What are young calves making?

AJ: Good Friesian bull calves one week old are making AUS$100 (€62.50) to $125/head. Jersey bull calves are making AUS$25 (€18.00)/head. We start calving in February and continue until October.

JK: Buildings, Labour and the Environment?

AJ: We have a concrete feed face where we feed out supplement. Other than this, the cows are never inside. They are out all the time. Close to this we have a bunker where we store slurry scraped off the concrete. We use the Derbyshire weeping wall system to separate the liquid and spread the solids in the summer. We milk through a two man, 28-point rotary. Milking takes one and half hour comfortable. Environmental concerns are not an issue for us at the moment. My son works full time on the farm and we have one full time labour unit.

JK: Average production?

AJ: Averaging just over 8,000 kg/year at 3.48% protein and 4.5% fat.

JK: Are you making money?

AJ: Yes profitability is good even in downtime on milk price. This is very much due to the system we run.

We try to limit meal feeding as much as we can. Grain has become very expensive due to drought and last year we had a late frost that shrivelled crops. Crops that looked good did not yield well as a result. Wheat is retailing for $AUS230 (€143)/tonne and the protein crops around $280 (€175)/tonne plus depending if Soya, Canola, beans, peas or lupins. Labour is not a major cost for us. Good labour is very scarce.

JK: What is the biggest challenge facing Australian dairy farmers?

AJ: Irrigation is without a doubt the biggest challenge. The cities Sydney and Melbourne are demanding more and getting increased allocations of water every year. The poor farmer loses out. The last two years have been tough. Winter starts in Australia on 1 June and at the moment weather is very favourable over there. A lot of dairy farmers have left the industry in the last two years because of high prices for feed and the drought.

JK: Are you happy to have moved to Australia?

AJ: The best move I ever made. I have one son milking at home. My daughter is married to a local farmer and living three miles from the home farm. My youngest son is studying 'Oncology' (dealing with people with cancer), has more brains than his father and travels to conferences across the world. I plan business trips to Ireland as often as possible.

If people have other overseas contacts with Irish links that they would like to hear a report from, ring Jack Kennedy on (087) 9082651.