Part 10. True heifer costs

Farmers are not aware of the true cost of rearing a dairy heifer!

Dairy farmers in Northern Ireland reckon that they can rear their heifers or less than £1000 and 23 % of these would estimate as low as £500, according to an indepth survey conducted by AFBI/CAFRE. But benchmarking figures show that the real cost is £1220

Typically, dairy heifers calve at 28 months of age on average having consumed 860 kg of concentrate to rear them to this stage. Table 1 shows how current input costs will impact on rearing costs. The average cost of £1,200 is well beyond the estimates given by farmers in the survey. It is evident that farmers often do not take into account the full rearing cost (including overheads) of their heifers.

Table 1.  Typical costs of rearing a Holstein dairy heifer to point of calving

• • A number of points should be noted from Table 1.

    • No account is taken of the farmer’s own labour.

    • There is a large variation around the average. The top 25% most efficient farmers can rear their dairy heifers using over 620 kg less meal per heifer than the bottom 25% of farmers (580 kg compared with 1200 kg). For a 100 cow dairy farm rearing 30 heifers per year, this difference in concentrate feeding at current costs is equivalent to £4,500 per year.

    The top farms:-

    o serve heifers earlier

    o maximise grazing days for heifers

    o make quality silage

    o have more heifers born in the autumn than in the spring

    • Overheads are allocated per hectare on a dairy farm. This method of allocation is the same for all farmers using benchmarking and thus guarantees consistency.

    The high cost of heifers requires high lifetime yields to spread this cost over a greater number of litres. If an animal lasts for only 1 lactation of 7,000 litres and is then culled for £400, the replacement cost per litre for that milk will be almost 12 pence. This shows just how important an investment heifers are to the modern dairy herd.

    Calving age

    Take an example of a farm with 100 cows currently calving heifers at 36 months of age and with 30 heifers over two year old. If this farm moved to calving at the typical 28 month calving, there would be 11 heifers over two years and at 24 month calving there would be no heifers over two years old

    Assume that additional cows can now be accommodated in the housing that the heifers over 2 years of age occupied and that sufficient slurry capacity exists to milk additional cows instead of keeping 30 heifers on average over 2 years of age.

    It is also assumed that 24 month heifers yield 780 litres less per lactation than 36 month heifers while 28 month old heifers yield 580 litres less than 36 month heifers.  The lower yield of 24 month heifers may well be made up during the productive life of the animal but this has been ignored in this calculation.

    Moving from 36-28 month calving.

    Farm profit would be £5,100 higher if the farm moves to 28 month calving and keeps additional cows (up to the 170 kg livestock manure nitrogen per hectare limit).  This assumes an average milk price of 20 pence per litre.

    If the farm stays at 100 cows and moves to 28 month calving, there is land released that does not have to be taken in conacre or land that can be let out.  If a price of £300 per hectare (£120/acre) is used for conacre, the farm would be better off by £4,600.

    Moving from 36-24 month calving

    Farm profit would be £8,400 higher if the farm moves to 24 month calving and keeps additional cows (up to the 170 kg livestock manure nitrogen per hectare limit). This assumes an average milk price of 20 pence per litre. Every 1 pence difference in milk price from 20p would change this calculation by almost £1,000.

    If the farm stays at 100 cows and moves to 24 month calving, there is land released that does not have to be taken in conacre or land that can be let out.  If a price of £300 per hectare (£120/acre) is used for conacre, the farm would be better off by £6,900 (Table 2).

    Table 2.  Increases in profit by moving from 36 month calving to either 28 month or 24 month calving through renting out land or increasing cow numbers

    	28 month calving (typical calving age)	24 month calving (target calving age)
    Moving from 36 month calving and land freed up let out in conacre	£4,600	£6,900
    Moving from 36 month calving and additional cows milked	£5,100	£8,400

    Summary points

    1)    Dairy farmers in Northern Ireland underestimate the cost of rearing their heifers. At current prices, a heifer will cost £1,220 to rear.

    2)    Efficient use of forage will reduce rearing costs. The top 25% of farms use 620 kilos less meal to rear a heifer than the bottom 25%.

    3)    Moving to 24 month calving will increase farm profit if the additional land released is used to milk additional cows or let out in conacre. Savings in rearing costs and additional fertility performance and lifetime yield will be additional benefits.

    4)    Autumn born calves are cheaper to rear to 24 months of age than spring born calves, because they have a higher proportion of grazed grass in the diet.

    
    
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