Building Sustainable Dairying Enterprises

Alison Dewes is part of an agribusiness consulting team that specialises in designing resilient farm systems that optimise returns while minimising the impact on the environment.

Alison and her team have been involved in a range of projects focused on improving water quality in key Waikato waterways and lakes, looking at where economics and environment meet. This includes Rotomanuka Lakes, Lake E and Lake Ngaroto. The Headlands team are also developing farm plans for 60 farms over three years in SFF projects in the Upper Waikato and Waipa regions to look at what systems are the most resilient, profitable and have the lowest footprint, benchmarking farms using an environmental scorecard approach.

Basically Headlands advances a range of farm systems that reduce environmental footprints. They’ll help farmers come up with effluent systems, whole farm plans and technical support and modelling to help farms stay profitable and resilient.

Alison trained and worked as a large animal veterinarian throughout the Waikato and Bay of Plenty. She has dairy farmed in both NZ and Australia for 25 years. While farming in Australia, she was part of the design and implementation of the “On Farm Quality Assurance Schemes” for Nestle. She also managed the establishment of Intelact Agribusiness Consultancy in Australia. She came back to NZ at the end of 2009 and took up post graduate study in Freshwater Ecology and Nutrient Management in Agriculture, as well as farm dairy effluent design and management She says she’s probably best described as an agroecologist.

Bruce and Donna Arnold are Waikato’s Dairy Business of the Year winners for 2013. They are a highly successful farm operation with a return on capital of 9.0% from the 2011-2012 season, and operating profit of over $7000/ha.

Last season’s milk production was 493kgsMS/cow (93% MS as % of liveweight vs average at 72%) on a stocking rate of over 4 cow/ha. The Arnold’s average pasture harvest has been 14-16 TDM over the last 5 years – this is class one land with high productivity. Alison says stocking rate is all relative to landscape and farm management capability.

Interestingly, South Waikato’s pasture harvest has only averaged 9-10TDM for the past 3-4 years (40% less than the Arnold’s), therefore average stocking rates should be less – more like 2.6cows/ha. It is an important point to make that not all regions are equal and averaging is dangerous.

Alison has worked with the Arnolds on their environmental sustainability. She talks about the Arnold’s farming in the sweet zone where inputs deliver really good yields while minimising the environmental footprint and setting up the farm business so it’s resilient to risk. The Arnold’s farm is 100% fenced from waterways.   They leaching N at 21kg/ha which is way below the average for the Waikato.

Alison says the most common risks to an intensive farming system include fluctuations in commodity prices, resource constraints, and drought and unstable labour markets.

Intensive farming systems also increase the risk of diffuse losses of nutrients, sediment and pathogens to the environment, which represents a cost to New Zealand. Alison and her team now benchmark farms’ environmental performance using a scorecard approach to denote the farm systems’ risk to the receiving environment. This scorecard gives a score for waterway and soil protection, nutrient, sediment and pathogen loss risk, effluent compliance and nutrient use efficiency, water use efficiency and waste disposal. With the scorecard they evaluate all the likely risks to receiving waters and resource use efficiency using a single metric.

Historically New Zealand farming systems have been able to maintain a ‘low cost- low risk’ production base, achieved primarily through pasture based production and flexibility. Such systems rely on good pasture management as a low cost way of increasing profitability. However Alison says that farming intensity has seen a great expansion in nitrogen and phosphorus fertiliser which has led to higher stocking rates through better pasture quality and production.

She says that in the past we have assumed that increased fertiliser will produce an increase in pasture harvested, and therefore an increase in milk solids produced per hectare. However in the last decade, responses to fertiliser use and higher stocking rates have provided comparatively lower production gains. In many circumstances the risk profile has increased and the fluctuations between good years and difficult years have increased, leading to less income certainty.

In order to manage the increased risk, intensive farming systems have moved to imported feeds to decrease the threat of home grown feed deficits and maintain higher stocking rates.

Alison says that this type of system is highly stressed and has little margin for error. It is more difficult to maintain consistent profitability on these systems, which can lead to significant stress to the farmer. These farmers need to use the best available technology and support to ensure they stay ahead of the game.

For the Arnolds, this has included analysis of their whole farm performance annually, being benchmarked on environmental and staff management performance, monthly consultancy with Dr. Andy Collier to ensure the farm information, performance and farm systems are on track to be profitable every year; and using UDDER/Red Sky and Overseer (farm modelling software).

The Arnold’s farm is 156 ha (152ha effective), with a supporting block of 27ha 4kms away. The property is split by Highway 27 with an underpass for stock movement, and includes four houses, a 50 bail Rotary cowshed and supporting buildings/calf sheds etc.

The effluent pond is relatively new. It’s 7000 m² and can hold up to 6 weeks storage. It has a separator installed. The Arnolds are currently irrigating 53ha and in future will expand this to another 50ha.

At over 4 cows to the hectare, the Arnolds run a high input system. The focus is on pasture harvest but if grass is in short supply in spring they might feed a cheap protein such as DDG or cotton seed depending on price.

The 27 ha at the runoff is made into grass silage and any surplus at home is also made into stack and baled grass silage.

Other feeds include maize, straw, P6, PKE, molasses, and soya.

Their feed pad was built 12 years ago to minimise wastage and extended 6 years ago to accommodate an increase in herd size. 3 bunkers were also built 5 years ago to hold 650 tonne maize as well as 2 palm kernel bins to hold 60 tonne of PK.