I’ve been on a number of very well-run farms over the last number of weeks. Many are coming to a crossroads in terms of further investment.

Over the last few years, some farmers have increased cow numbers and gradually reached a stocking rate of close to three cows/hectare, with land blocks away from the milking parlour, doing all they can to feed replacements and grow silage.

I was on three farms in the last week where 10 years ago there were 80 cows and now there were close to 200 cows milking. Milking 200 cows also means you need 50 to 70 weanling heifers and 50 to 70 in-calf heifers.

This effectively means you have over 300 livestock units that need to be fed every day of the year, irrespective of whether they are producing milk or not.

Coming to a crossroads

These very progressive farmers are, in many ways, coming to a crossroads in terms of the next step. For many there is a young son/daughter back farming at home, providing the impetus to reach 200 cows.

Adding more stock on many of these farms would mean more cubicles are required, more milking units, more labour and often a more complicated system with a lot more feed required at the shoulders.

In an ideal world, more land near the milking parlour would help produce more efficient milk, but more often than not this is not possible.

So, in effect, the farm business is deciding whether to intensify, with even more capital spend in the farmyard, while the overall land block stays the same. Effectively, the farmer’s margin per extra litre will be reduced.

Do these progressive farmers sit back now and be happy with their lot? For many farmers, this is not their style. So, what are the push and pull factors?

On one side you have grant aid enticing farmers to put up more cubicles and slatted tanks. On the other you have many farmers afraid to take on more labour, choosing to stay at current herd size.

Dangerous

The nature of many Irish farmers is to move on, invest more and do more work themselves. However, farmers must be very careful. The big caution must be on the type of investment: buying machinery to push in more feed, or investing more in concrete on a limited land platform can be very dangerous and limit the potential of the overall business.

It can even go further and make the business unsustainable and too pressurised on the existing labour resource, which can jeopardise the whole enterprise. On the other hand, investing in more farm roadways, more reseeding and drainage, improving soil fertility, better genetics and growing better youngstock will give a farm business in Ireland much greater return. All of these items, which constitute an investment outside of the farmyard, can cost big money – and farmers need to be very careful to be strategic in their investment.

A high-profit enterprise can quickly turn into a very labour-intensive business, with long hours and more feed to be purchased, making the risk higher. At a time when we know global markets are going to be more volatile – and even more so with recent major political developments – now is not the time to make the wrong decision.