This week, we preview the farm of Kieran Hearne, Rathgormack, Co Waterford, who is one of the hosts of the IGA Dairy Summer Tour which takes place next Wednesday, 14 August. The other host on the day will be David Kirwan, Stradbally, who is a new entrant to dairying.

Growing the family dairy farm is the theme of the tour. This is not just about milking more cows but making more profit. Both of these farms have more than doubled their net profit per hectare in the last five years.

Kieran Hearne has nearly trebled cow numbers to 158 cows today from 55 cows milked in 2005.

David Kirwan is in his second year as new entrant and is milking 75 cows, with plans to increase to over 100 cows post 2015. Both men share a common goal – to create a more profitable business which will provide for their families and give better options to the next generation.

Profit per hectare

Kieran Hearne farms 61ha in Rathgormack with his wife Ann and four children — Laurence (11), Fiona (9), Conor (7) and Stephen (5). In 2005, he farmed 55ha in total and was milking 51 cows along with finishing both his own, and 30 bought in, bull calves. Net profit from the farm, excluding Single Farm Payment and a charge on Kieran’s own labour, was €690 per hectare.

If a labour fee for Kieran of €30,000 was included, the business’s net profit falls to €145/ha.

Today, Kieran farms 61ha in total and has 50ha around the parlour stocked at 3.3 cows/ha (158 cows and followers). He is 100% spring calving, buys in standing silage for dry cow winter feed and heifers are summer grazed on a local beef farm during their second year. Net profit per hectare for 2012, including a labour fee for Kieran, is €1,190/ha. When accounting for differences in milk price between 2005 (before expansion) and 2012, the extra profit created is still well over €600/ha.

But this business is still only settling post expansion. Depreciation and loan interest are all extra new costs, which will reduce in time, returning even more profit to the Hearne family. The farm is now large enough to employ labour which allows Kieran to spend more time with his young family.

Come to Waterford on the day to find out how and why Kieran grew his dairy business. Asking why is important. With milk quotas going, every farm in Ireland can choose to milk more cows, but what is the objective?

For Kieran, it was clear. He said: “I needed to generate more profit to give myself options. With 51 cows, I was tied to the farm, now I employ an excellent farm worker, William Gavin, full time in the spring and three days a week during the summer. I can make more profit while spending more time with my family.

‘‘My wife Ann and I have four children between 11 and five, so these are important years in our lives. Drawings for the family will increase a lot in time also, and I wanted to create a business capable of meeting this demand.”

To grow cow numbers to 158 today required significant investment. In 2009, a new 18-unit Westfalia milking parlour was completed. Kieran left good space behind the milking parlour and converted this into a rectangular yard with a backing gate; this removes the need for a milker to exit the pit during milking which reduces milking time.

A new 12,200 litre bulk tank was also purchased. To carry the extra stock over the winter, a total of 75 cubicles were added and slurry storage (two slatted tanks) was increased to cater for 180 cows. Over the years, Kieran also spent close to €100,000 on milk quota. The opportunity cost of the stock Kieran retained during expansion accumulates to €132,000. He feels it’s important to value these stock as you don’t have to farm them, scale could have remained where it was and stock could have been sold.

Total cost of expansion came to €514,000. Kieran increased numbers by about 125 livestock units which works out at €4,100/cow including a cost of quota of €1,000/cow.

High EBI

Kieran has one of the highest EBI herds in the country, with an average EBI of €180. This is composed of €49 for milk and €105 for fertility.

Excellent genetics, supported by top class management, are delivering solid performance — last year, cows delivered 421kgMS/cow (5,051 litres at 4.44% fat and 3.66% protein).

In 2005, milk solids production from the herd was higher at 485kgMS/cow (6,070 litres at 4.11% fat and 3.65% protein). Production per cow has dropped by 15% during expansion but production per hectare has gone up by nearly 100% to an expected 1,520kgMS/ha in 2013 (with 100% winter feed purchased).

More hectares are now used for milking cows and each hectare is stocked higher. The herd also has top class fertility: in 2013, the calving interval was 364 days, 82% calved in six weeks and the submission rate was 94% in 24 days. This allowed cow numbers to grow from within the herd due to having few empty cows and plenty of replacement heifers generated.

Kieran is passionate about breeding profitable genetics. His herd is pedigree registered and goes by the ‘Curra’ prefix. he has seven high EBI bulls in AI studs around the country. Stock sales added 4c/l to Kieran’s gross output last year. Now that the herd is finished expanding, he now sells some surplus heifers as calves in spring.

Despite this love of breeding, Kieran is not overly concerned about production per cow. He has completed a profit monitor on the farm since 1996 and knows production is only one side of the profit equation; costs must be kept tight.

He said: “At the moment, one of my biggest challenges is to grow more grass by improving soil fertility. In 2007, my indices were good and I stopped spreading compound. Tests last year revealed 80% of paddocks are less than index 3 for phosphorus and 38% are less than index 3 for potassium. Addressing this will be a major priority in the future.”

Dairy tour

Dairy farms all over Ireland will consider expanding like Kieran. Having land available around the parlour made expansion possible but significant initiative and hard work were needed to get the farm to where it is today.

I would strongly encourage anyone with an interest in increasing profit from their dairy business to attend the IGA dairy tour. Many will also want to see the new entrant farm of David Kirwan. The jump from sucklers to dairying is a big one but David has coped extremely well and there are lessons to be learned from his story for established and prospective dairy farmers alike.

KEY POINTS

Excellent fertility and management has allowed Kieran grow cow numbers from 51 to 158 cows since 2005.

Net profit has increased from €145/ha in 2005, including own labour to €1,190/ha in 2012.

Expansion cost of €4,200/cow, including €1,000/cow for milk quota.

New entrant dairy farmer David Kirwan will also be visited on the day.

Curra Royal Carra - one of the best commercial cows across Ireland

Pictured is one of Kieran Hearne’s cows – Curra Royal Carra.

She is UYC sired out of an SPW cow. She was born on 14 February 2003, calved for the first time in February 2005 and has completed eight consecutive lactations since, calving in spring every year. Her EBI is €294 (€87 milk: €176 fertility) making her number 27 in the country. Last year, she produced 6,100 litres at 4.63% fat and 4.18% protein (554kgMS) on 600kg of meal. She has bred two bulls which have been sold to AI stations and two more are potential candidates. Kieran has a huge belief in the EBI. He said: “The faith I have shown in EBI is being paid back to me 10 times over in more profitable cows. If you use the sub-indices properly EBI will deliver both exceptional milk solids and fertility. Who knows where the Holstein cow will be in 10 years’ time if we keep maximising the use of EBI.”