Dairy Focus: Develop Strategies to Lower Feed Costs

Recovering from low milk prices has been anything but easy with today’s higher feed costs.

Certainly the unaffected reader might be thinking that is nothing new because agriculture almost always is in need. The problem this time is not just high costs, but the lack of good feed buys. That is, no feed ingredients are priced much lower than the rest on the market to make one a clear choice to switch to using it. If such an ingredient existed, it likely would be gone, anyway.

Producers have no easy answer or “silver bullet,” but here are some suggestions from Paul Cerosaletti, Cornell University Cooperative Extension Service, in the SCNY Dairy and Feed Crops Digest to help keep feed costs in check.

- Cow health/cow comfort issues. Feed costs will be high if cows don’t make as much milk as the ration they eat should support. Do you have some big issues on your farm causing cows to perform poorly? If so, seek help to get at the root of the problem.

- Don’t let feed accounts payable build. If you have a feed bill mounting, and that’s more common than you think, especially right now, do two things: work with a nutritionist to make sure that you are feeding your cows economically and contact your lender. See about getting the open feed account moved to a line of credit at a much lower interest rate. Most feed mills are going to charge an annual interest rate of at least 18 percent, whereas you can borrow money from a lender for at least half that amount. Realize that, on a big bill, the difference in interest between the feed mill and the bank can buy several tons of feed each month.

- Provide adequate water. Be sure the cows get adequate water and it is good quality. A water test through the forage lab can determine quality. An old rule of thumb for a stanchion barn is the quantity should be 3 to 5 gallons per minute from every water bucket when under peak demand.

- Inventory forages. Know how much forage you have and how good it is, and use it accordingly. If possible, make sure the high-producing cows get the best forage. Know how much of your forages you can use per cow per day to avoid using up the forages too fast or not fast enough. If you are short on forage, knowing what quality forage you have can help you decide if you need to go after top-quality forage or maybe some average-quality feed that can be used for heifers.

- Evaluate your additives. Now is a good time to re-evaluate the feed additives you use and decide if you really need them and, if so, how to use them. Many of these additives are very expensive, but can be effective. Many are very difficult to determine their effectiveness in your herd, and some (such as organic minerals) have effects that are not seen immediately if they are added or removed. In determining what additives to use, ask for research data to back up claims.

- Use a protein and energy system. Time and again, for component-fed herds, this is the cheapest way to feed cows if you are willing to do it and it’s done right. The protein grain should be very concentrated - more than 30 percent crude protein, which, in its purest form, can be straight soybean meal (or other high-protein byproduct, such as canola meal).

The more concentrated it is, the greater the savings. The energy grain should be much less expensive and low in protein. You should expect a large difference in price between the protein and energy grain - at least $50 per ton. If that difference is not apparent, the feed formulas should be examined again. The cost savings come from feeding fewer pounds of the high-protein feed and from being able to use the energy mix to put weight on cows in later lactation, and not having to feed both energy and protein to the cows to accomplish it. Be aware of the following:

* With a highly concentrated protein grain, the cost per ton will be high. You should be feeding fewer pounds per cow per day, and feed costs per cow per day should be less if the ration has been balanced properly and you follow the feeding recommendations.

* With a high-protein grain, overfeeding protein can be easy if you are not careful. Follow the nutritionist’s feeding guidelines.

* Minerals (including salt) still need to be fed. When you have a highly concentrated grain fed at a low rate, getting all the minerals into the cow she needs and still have a palatable grain mix is hard. You may need to resort to an energy mix with minerals in it.

* Don’t short cows on NFC (nonfiber carbohydrates). NFC, or sugars and starch, are a basic ingredient to making milk. Sugars and starch grow a lot of rumen bugs, which in turn are a high-quality protein source for the cow and can support a lot of milk production. You can cut milk production dramatically by shorting a cow on NFC. Ration NFC content should run between 35 percent and 40 percent of the total ration dry matter. The major source of NFC often used is corn. Other good NFC sources include barley, wheat and triticale grain (these are pretty much equal to corn in starch value); molasses (and other sugar sources); wheat midds; and oats. Most byproduct feeds are low in starch and sugar, and are poor substitutes for ground corn or small grains.

* Review your mix list. The quickest change you can make is to cut back grain on low producers that are getting more grain than they need. The first step is to know how much milk each cow is giving. Borrow or rent a milk meter if you have to. Be careful about pulling grain away from fresh cows. These are the cows making you the most money. Don’t overfeed them and throw them into acidosis, but don’t short them to cut grain costs.

How much grain to feed? The old rule of thumb was to shoot for 1 pound of grain for every 3 pounds of milk. On poor forage, this can be hard to achieve on tail-enders. With adequate forage (especially corn silage) and good forage quality, achieving a 4-1 milk-to-grain ratio is easier. Modify this rule of thumb to allow for thin cows in late lactation that need more grain to put on body weight and where you are feeding a less expensive energy grain.

- Ask for help. Don’t be afraid to communicate to your feed representative the need for help in containing feed costs. Be very clear about what you want and what you need. If you know your feed costs are high and you are having trouble making ends meet, be clear in communicating that something needs to be done. Ask for help in identifying feeding options. Your feed representative may be able to present several options from which you can choose. Examples from the Dairy Diagnostic program have highlighted good success with effective communication.

- Track your feed costs. Things are tight on your farm financially right now, but are feed costs really to blame? Are they out of line? Do you know? Measure feed costs. Calculating feed costs is not a monumental task. Total feed purchases (including heifer and dry-cow grain, as well as milk replacer), should not exceed 30 percent of gross milk receipts on average. Look at monthly intervals to manage these costs more real time (rather than waiting until year end). In just looking at the lactating cows, plan on spending no more than 22 percent of gross milk receipts on grain for them. Break it down to a daily basis. For the level of milk your cows are making, how much should you be spending on grain? Plan your grain use accordingly.

By J.W. Schroeder, Dairy Specialist - NDSU Extension Service

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Dairy Focus: Develop Strategies to Lower Feed Costs