10 Considerations for Feeding Cows During Low Milk Prices

When margins shrink, costs should receive some extra scrutiny. Some would say, this scrutiny should be applied even in good times. In today’s environment, savings need to be found and efficiencies gained. Here are opportunities to fine-tune your operation.
 

1. Don’t lose milk or milk components: Milk component production remains the economic engine to fuel your cash flow. Although 30 to 40 percent of gross income goes to feed costs, 80 percent of gross income is from milk sales. Cuts in feed costs could lead to losses in milk volume, quality and revenue.
2. Cows don’t care about low milk prices: Although prices fluctuate, the nutrient requirements for your cows don’t. Supplying nutrients below the necessary requirements will result in long-term health and production expenses.
3. Know your forage inventories and use: Feeding forages is a natural cost-saving strategy but needs to be measured and monitored effectively. Track how much haylage and corn silage you use and always have a back-up plan.
4. Improve forage quality: Be proactive and make quality improvements to forages before harvest for long-term benefits. Get out in the fields, inspect the crop and measure alfalfa growth. Quality forage goes beyond nutrient content and extends to how well it is harvested, preserved and removed from storage.
5. Re-evaluate additives: An additive that once seemed valuable may now be irrelevant. Talk with your nutritionist to review your products. Lean toward additives with research-proven returns on investment, especially those that show long-term benefits.
6. Scrutinize “good deals” carefully: These can be tempting when margins are tight, but always get as much information as possible. Always ask for nutrient specifications and if the deal seems too good to be true, ask why it is such a deal. Are you getting the ingredients that you and your consultant have decided are best for your herd? Be certain you are getting what you pay for.
7. Reduce feed shrink: Feed shrink, from feed waste and losses, is expensive and costs anywhere from $10,000 to $20,000 per 100 cows per year. Storage type, improper maintenance and feed refusals play large roles here. Always carefully evaluate feed storage and quality of feed.
8. Voluntarily cull unprofitable animals: Making this long-term decision isn’t a simple task, luckily there are decision models available for this process. A few things to consider are milk value, replacement rates and value, pregnancy rates, and worth of genetic improvement. Don’t forget about your youngstock … are you raising the correct amount? Are you raising the best replacement candidates?
9. Evaluate grouping strategies: Consider grouping the animals by different nutrient requirements, such as far-off dry cows and close-up dry cows. To further capitalize on these savings, consider optimizing farm layout, equipment and labor demands to accommodate these groups.
10. Evaluate labor efficiencies: Sometimes this is the most logical way to reduce costs because labor expenses can consume 10 to 15 percent of gross revenue. Consider cutting a non-essential position or focus on reducing turnover and improving position efficiency.

Although it may be tempting to make sudden and drastic cuts in expenses during these times, you should always consider short- and long-term value and return in addition to cost.

United Cooperative has the quality people you can depend on to deliver value to your operation. Our high standards and focus on services, manufacturing capabilities, and quality is our commitment to your profitability. We at United Cooperative strive to be a solid member to your TEAM of trusted professionals.

John Scheuers

Vice President - Feed