AHDB has recently produced a report looking at optimum dairy systems, investigating which system tends to drive profitability and competitiveness. The report reviewed current systems in the industry and found that over 80% of British dairy farmers identify themselves as practicing all-year-round calving with the remainder being either spring, autumn or dual block calvers.
They highlighted that analysis suggests that the top performing herds, under either system, are competitive and achieve sustainable profits but, on average, those farmers operating block calving systems tend to have lower costs of production. Evidence shows that spring block calving herds produce milk for 2.1 to 2.4ppl less than an all year round herd. For autumn block calving, the savings are in the region of 1.1 to 1.3ppl. However, production costs and margin are not the only factor a farmer needs to consider when deciding which system is optimal for them. One other major factor is which market they are operating in and what their milk buyer desires. They also highlighted the fact that, no matter which system they are on, those that were benchmarking had a better performance as they had a better understanding of the strengths and weaknesses of their business. AHDB concluded by saying they are asking farmers to hold a mirror up to themselves by asking if they know what system they are on and whether it is optimal for them.
The meetings also highlighted the work of the NFU on behalf of the industry - setting out the NFU’s Dairy Board Vision which aims of transform the environment to ensure a better future for our dairy farmers.
There are three key areas of work, the first of which is building better, fairer supply chain relationships. This calls for a post Brexit Contracts Code underpinned by law which will set out minimum contractual standards for all, advocating the importance of producer representation and delivering true market transparency.
The second key area is building a better business environment to ensure farm competitiveness. Within this area are elements such as giving farmers access to options which help them deal with volatility and risk - such as futures, forward based contracts and insurance. We are also asking for mandatory price and volume reporting and action to help tackle disease such as Bovine TB, BvD and Johnes.
The third area is to defend and promote dairy to increase consumption both at home and abroad. This includes promoting the school milk scheme, tackling anti-dairy campaigns and really shouting about the nutritional benefits of consuming milk and dairy products.
Post Brexit, there are some huge opportunities for dairy and promoting our product and standards both at home and abroad will be vital to realising these.