Managing feed supply

How do you minimise the impact of price and supply risk of your feed supply? The first step is to have a good handle on your situation by doing a thorough feed budget. Historical data from the Victorian Dairy Farm monitor project shows that feed cost, both home grown and purchased, on average represent around 50 per cent of a dairy farms cost of production. So, investing some time in your feed management is a good investment for your future profit.

Hopefully most of you already have a feed budget in place and are now just reviewing it monthly. If you don’t, now is a good time to start. The best time to do a feed budget is once harvest has been completed, so you can get an accurate count of the volume of feed you have on hand. It’s also a good investment to get a feed test done on the different feeds you have available so you can manage where you are going to use your better-quality feed and when you might be able to get away with using your lower quality feed sources.


The first step in a feed budget is establishing the feed demand and to do this you need to get an accurate head count of all the stock that need feeding over the given period. Don’t forget to pay special attention to your young stock! They are your future and sometimes they can get left behind while the focus is on the milking herd. Once you have an accurate head count you need to make some predictions about how many KG of dry matter to allow for each class of stock on the farm to achieve growth and production targets.


Rather than starting from scratch and making your own, use the Dairy Australia Feed budgeting tool. Most of the heavy lifting has been done for you and all you need to do is fill in the yellow squares on the xcel spreadsheet to reflect your farms situation. As the old saying goes “rubbish in - rubbish out”. Which means the more accurate your assumptions are about your current situation the more confident you can be about a forecast deficit or surplus in your feed budget.   


Once you have established the demand side of the equation you need to get an accurate handle on the feed supply available to meet that feed demand. You need to make some assumptions about how many kg of dry matter you may be able to harvest from the dry land pasture you have growing on your farm. You also need to get an accurate count of how many silage or hay bales you have on hand. Having a feed test on these feed sources is going to increase your accuracy of the available dry matter in your silage. Don’t forget to include the grain mix fed in the dairy as well. 


So, now that we’ve established the monthly demand and supply of feed for your farm for the given time period, its easy to see when you will have surplus feed and approximately when you will have a feed shortage, and the size of the shortage you will have. The power of this budget is that now you have an estimate ahead of time, of when you need more feed and how much feed you will need. The choice is now yours if you secure that feed ahead of time or wait and see what the feed market does. The benefit of feed budgeting is the more you do it, the more accurate you will become and the more valuable the information will be to your business.   


A handy resource to stay on top of movements and trends in the hay and grain market is Dairy Australia’s Hay and Grain reports which can be found at Dairy Australia Industry Reports


By Peter Gaffy, Extension Advisor - Feedbase and Nutrition


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