Phone: (03) 5593 1100

www.fivestarstockfeeds.com.au

May Newsletter 2016

Making good decisions when the pressure is on

Whilst there is some concern about milk pricing at the moment, there are still plenty of positives out there

to remember. The grain prices seem reasonably stable (with the price gap between wheat and barley real-

ly starting to open up), the fertilizer price is as low as it has been for ages, chopper prices are still pretty

good, it seems like there is a chance we could swing to La Nina later in the year (which could mean good

spring rain and possibly a wet summer). It also feels as if we might have had a season break now which

will mean that all of your hard work in planting will pay off.

It is important to focus on the things that you can control and make sure you are doing the best possible

job of those.

There are only 2 choices to maintain income when your milk price drops

Send more milk

Change to another milk processor (if you can find a better one that will take you)

Many farmers worry about changes to their cost of production without actually knowing what their costs

are; this means they are flying blind when making decisions on their inputs. It’s important that you know

your cost of producing milk solids ($/kg MS), the break-even point and which levers you can pull without

affecting the long-term viability and profitability of your business. You need to be mindful of the impact that

cutting a cost may have on milk production, cow health, or cow condition. Whilst cash flow is king, you still

need to keep one eye on the medium-to-longer term path the business is tracking. Cutting back on feeding

now could mean that the cows calve in poorer condition and under stress, which then reduces peak milk

yield and the chances of the cow getting back in-calf. Having said that, you need to constantly monitor in-

dividual cow performance and make sure there aren’t ever too many passenger cows in the herd (those

not paying their own way).

Basically the key message here is don’t panic, and make sure you understand your feed and financial situ-

ation properly. It is really important to avoid knee-jerk reactions. It is all about prioritising your spending to

get the best possible outcome, rather than cutting the biggest costs without consideration for the flow-on

effects to the business.

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There are a couple of really important knee-jerk reactions to avoid:

Don’t stop fertilising. It is a good idea to review your soil tests and consult an agronomist or

independent adviser to ensure you’re getting value for the money you spend on fertiliser; however,

don’t cut it out altogether. Once there is moisture, home grown feed will be vital in making cash flow

better through this season and will be far more cost effective than any purchased feed option. You

will need to be supplying something like 1 kg nitrogen per hectare per day (30 units per month or min-

imum 70 kg per hectare of urea) to meet requirements, remembering that there is still an economic

response to urea down to about 6-7 degrees soil temperature. Gibberellic acid will also be a useful

tool this winter and can be applied once a month (between May and August) if you can keep the other

nutrients up to it.

Don’t stop feeding. No one ever starved a profit out of a cow so you will still need to feed the

milkers (and dry cows, springers and heifers) to keep them producing and keep the income flowing in.

It is important to make sure the diet remains balanced and that you are getting good feed conversion

efficiency, but don’t just stop feeding. The flow-on effects on body condition and therefore fertility will

last for years to come if you make the cows work too hard. It is OK to look at novel or unusual feeds

but don’t be tempted to jump in without consulting a nutritionist. There are very few bargains out

there, so be careful what you buy— and ask to see a feed test.

Do try and do the following:

Do build a pasture wedge before it gets too cold (by maintaining supplements as long as cash

flow will allow) and protect it with cheaper supplements such as straw, oat pellets and/or almond hulls

to ensure that pastures are protected and recover quickly.

Do sell cows that you are likely to cull this year anyway or that aren’t paying their way (work

out what the cut-off point needs to be for an individual cow)

Do sell surplus heifers and fully feed the rest (as opposed to underfeeding everything)

Do ask for help if you need it. Your suppliers want you to be profitable so don’t be afraid to

approach your bank, stockfeed, fertiliser or seed companies for advice. We have independent con-

sultants that we can recommend to help your business.

It is really important to keep your bank manager (effectively a partner in your dairy business for most farmers)

up-to-date with how things are going and what your requirements are going forward. They love to see cash flow

budgets including actual numbers for each completed month. These can be incredibly powerful tools in helping

keep things under control when cash is tight and will, at the very least, force you to understand the business a

bit better and help ensure there are fewer ‘surprises’. It is also a good idea to build in trigger points, which are

effectively stages or events that will trigger you to take another step or change strategies (before things get too

far in the red etc..). Local creditors (including feed, fertiliser, dairy supplies etc…) will only carry you so far as

things tighten up, so make sure you know where your business sits and what help you still have available from

your bank and/or milk factory. Communication with these people is the key.

Our sales and nutrition team are happy to help out wherever we can so feel free to give us a call. It is really im-

portant that the product going into your silo matches the forages that you have available. This is where you will

get the best possible value out of feeding pellets/grain.

April Newsletter 2016

Wheat – good in the dairy and the paddock

Home-grown feed consumption is a well recognised driver of dairy farm profitability. To achieve maxi-

mum home-grown feed consumption; you first need to grow as much pasture or crop as possible. With

winter closing in on us it is time to think about how to boost growth across the farm before it gets too cold.

Cockchafers, crickets, over grazing, and lack of moisture (over the last 6 months) could have severely

damaged many pastures over the summer, so you might need to have a think about which paddocks

need to be topped up and get stuck into it (assuming that you didn’t dry sow already). Five Star Stock-

feeds have been trialling cereal grains drilled into pastures. One paddock sown on the second week of

February has been grazed three times already this year. This highlights the potential for cereal crops in

combination with traditional pastures to work in our area. Don’t despair if you haven’t got it in the ground

already though – it is not too late to drill in May and still get some great results (with or without pasture

seeds mixed in).

Consider this... wheat drilled into a pasture will germinate and start growing within a week of decent rain.

Wheat has a large seed so it has a big battery (energy reserve) to germinate and kick-start growth. It will

continue to grow even if it dries out again and it will push up higher than typically slow-growing winter per-

ennials during the winter. It will happily fill gaps in the pasture and increase overall yield by between prob-

ably one and three tonnes dry matter per hectare (mostly over the first couple of grazings). It doesn’t

matter where you buy the seed from but if you can’t find any, we have access to a known late flowering

variety which should remain productive into early spring unless it gets waterlogged.

Here’s how the maths stack up for over-sowing with wheat:

An 800 kg bulka bag of wheat will be enough to do between 8 and 10 hectares for a cost of around $320

+ GST. A contractor will charge about $70/hectare to drill it into your existing pastures. This makes a

total cost of around $100 per hectare. It would be reasonable to expect two or three grazing’s, or about

two dry tonne per hectare on top of the grass you would normally grow. This extra feed has an energy

value of 11.5 MJ ME/kg DM per kg, giving you a total of 23 000 MJ ME for around $100 spend. We also

know that it takes 8 MJ ME (including cow maintenance) to make a litre of milk. So the equation becomes

23,000 MJ ME divided by 8 MJ/L to give us 2,875 bonus litres (probably).

If the milk factory paid 40 cents per litre for this additional milk you would make $1,150 of extra income

from $100. This is a great return in anyones business isn’t it? You could increase your yield (of the

wheat) by dropping DAP in with the seed at sowing time (100 kg DAP/ha) and spraying gibberellic acid

with a broad-leafed herbicide at the appropriate time (once the wheat and pasture are established). Re-

member this is additional income that could be made if you are prepared to have a go. It won’t be made if

you don’t do something to make it happen.

The other thing that never changes is that cows need protein to make milk. They need nearly four kilo-

grams of dietary crude protein to make two kilograms of milk solids a day. In most cases, it doesn’t mat-

ter where that protein comes from. Protein is protein. It could come off the back of a hay truck, grow out

of the ground or come out of your silo, or a combination of all of these. The cow will only produce as

much milk as her dietary protein allows her body to produce. The cow’s body is not like your bank ac-

count. She can’t borrow protein from her body to make milk today and pay it back later without paying a

penalty. That penalty will be lost body condition and fertility. It is far better to get someone who knows

what they are doing to do a farm walk and ration balance than risk cow condition and poor milk produc-

tion. Ask us at Five Star - we have people with up to twenty years’ experience that can help.

Bulk Price List—Effective 9th May, 2016

Code Payment

In 7 days

Payment

within 30 days

Payment

outside 30 days

Pellets

$345.00

$370.00

$357.00 $382.00

$381.00 $406.00

$404.00 $429.00

$338.00 $363.00

Crush mixes

$327.00

Premium Calf Pellet

$442.00

$452.00

Premium Heifer Pellet $396.00 $406.00

$428.00 $438.00

$257.00

Field Rep:

Field Rep:

Campderdown Mill – 21 Sinnott Crescent, CAMPERDOWN VIC 3260 Phone: (03) 5593 1100 Fax: (03) 5593 1084 Email: admin@fssf.com.au

www.fivestarstockfeeds.com.au