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Forage prices hit UK dairy farm profits in 2017/18 after tough winter period

The recently published ‘Dairy performance report 2017/18’ from AHDB Dairy shows while milk production cost rose by about 1.1ppl overall in 2017/2018, the best performing farms were able to make a positive net margin.

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For the first time, the report is split out by different calving systems; all-year-round, autumn block, and spring block.

 

Kate Ward, AHDB senior analyst and one of the report’s authors, says the results are largely in line with what they were expecting based on previous years, however, she was slightly surprised by the performance results of the autumn block calving herds.

 

She says: “Bought-in forage costs increased markedly for the middle 50 per cent and bottom 25 per cent of autumn-calving herds in 2017/2018, compared with 2016/2017 and against average figures for the previous five years.”

 


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Winter

 

This is largely down to the challenging winter, with autumncalving cows in peak lactation during this period.

 

She said: “This report is not about comparing the different systems, but instead we want farmers to look at the figures in relation to their own systems and perhaps pick out their own biggest areas of cost and see whether it is something they can work on.

 

"It can also act as a resource for those farmers who might be thinking about changing from one calving system to another in the future.”

 

The data was sourced from farm accounts collected by Promar International.

KEY FINDINGS

 

■ The main areas in which top dairy farms performed better were herd replacement costs, feed and forage costs, power and machinery and unpaid labour

 

■ Data from dairy farms in other major exporting dairy countries also showed the competitiveness of the typical UK farm was adversely affected by its high machinery costs, despite competing relatively well across most other areas of cost

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