Dairy News Australia - May 2018

Ian Halliday to leave Dairy Australia. PAGE 8 GENETIC GAIN

April ABV release.

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MAY, 2018 ISSUE 91 // www.dairynewsaustralia.com.au

DEVASTATED Farmers hope to “move on” from MG sale . Pages 4 –5

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DAIRY NEWS AUSTRALIA MAY 2018

NEWS // 3

ACCC wants mandatory code of conduct THE COMPETITION watchdog has called for a mandatory code of conduct in the dairy industry, saying it would improve contracting practices between processors and farmers.

The Australian Competition and Consumer Commission (ACCC) released its final report from its dairy inquiry on April 30.

The inquiry was initiated by Treasurer Scott Morrison, in response to large and retrospective reductions in milk prices imposed by two major dairy processors in April 2016.

The inquiry involved extensive investigations, consultation and data analysis over a period of 18 months.

ACCC Commissioner Mick Keogh said a mandatory code of conduct would address problems arising from the large imbalance in bargaining power and information that exists between dairy farmers and processors.

“Currently, processors can impose milk prices and other terms of milk supply contract terms that are heavily weighted in their favour.

Halliday leaves DA. PG.8

“Some milk supply contracts also contain terms that restrict farmers’ ability to change processors for a better offer.

“These issues ultimately harm dairy production efficiency and reduce the effectiveness of competition between processors,” Mr Keogh said.

The ACCC explored ways to address these concerns and found the existing provisions of the Competition and Consumer Act (2010), the dairy industry’s voluntary code of conduct, or a prescribed voluntary code would be inadequate.

“A mandatory code would improve the quality of information and price signals available to dairy farmers, enable fairer allocation of risk and enhance competition by removing switching barriers,” Mr Keogh said.

“While introducing a code won’t fully correct the bargaining power imbalance, it will reduce some of the negative consequences.”

The inquiry also analysed the impact on the dairy industry of $1 per litre milk, first introduced by major retailer in 2011.

“The price set by retailers is arbitrary and has no direct relationship to the cost of production for the supply of milk.

“In examining the impact of this on farmgate prices, however, the ACCC found almost all contracts for the supply of private label milk allows processors to pass through movements in farmgate prices to supermarkets.

“Therefore, there is no direct relationship between retail private label milk prices and farmgate prices.”

“Therefore, if supermarkets agreed to increase the price of milk and processors received higher wholesale prices, processors would still not pay farmers any more than they have to secure milk,” Mr Keogh said.

“Given this, the ACCC believes that increases in the supermarket price of private label milk are unlikely to increase the farmgate prices received by farmers, unless farmers have improved bargaining power in their negotiations with processors.”

Calendar pin-ups reveal mental health stories

$300/head boost. PG.21

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NEWS .....................................................3–15 OPINION ....................................................16 MARKETS ..........................................17–20 APRIL ABVS .....................................21–27 MANAGEMENT .............................. 28–31 ANIMAL HEALTH ..........................32–33 MACHINERY & PRODUCTS .....................................34–38

TWELVE GIPPSLAND dairy farmers have stepped outside their comfort zones to share their personal mental health story. The farmers feature in a calendar launched at Farm World last month, which organiser Sallie Jones hopes will serve as a starting point towards breaking down the stigma attached to mental health in rural communities.

“Our wish is that this calendar prompts honest and real conversations about a health issue that often we feel ashamed or embarrassed about,” Sallie said on behalf of those who participated.

“Calendars will be distributed to 1400 dairy farms in Gippsland where it is hoped that this calendar will serve as a resource for any farmer suffering mental health struggles.

“The calendar will include help numbers to health services available.

“Through speaking to many Gippsland farmers over the past few months, we have found that most dairy farmers don’t know where to get help.”

Steve Ronalds, Tom Gannon, Royston Nettelton, Ian Cougle, Paul Kent, Simon Barnes, Mikaela Whiting,Matt Wilson, Sallie Jones, (front row) Imogen Quigley, Melissa and Bruce Glasgow, Joe Meggetto.

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DAIRY NEWS AUSTRALIA MAY 2018

4 // NEWS – MURRAY GOULBURN

Class action planned against MG GEOFF ADAMS

MELBOURNE LAW firm Slater and Gordon proposes to launch a class action against milk processor Murray Goulburn on behalf of unit trust holders.

The action claims the company misled unit holders with its profit forecasts prior to the profit downgrade and the milk price crash in 2016.

The law suit also claims that Murray Goulburn breached its disclosure obligations.

Slater and Gordon and litigation funder IMF Bentham Ltd opened registrations for a class action last week.

The proposed claim is open to all current and former investors who acquired units in Murray Goulburn’s listed entity MG Unit Trust between May 29, 2015 and April 26, 2016, including through the initial public offering in 2015.

Slater and Gordon senior associate Andrew Paull said registrations for unit holders would be open until May 18, with formal proceedings expected to be filed soon after that date, subject to sufficient interest.

“Thorough analysis of the recent ACCC and ASIC inquiries into Murray Goulburn have strengthened our initial findings that suggest the

company misled the market by forecasting profits it could never have achieved in the 2016 financial year,” Mr Paull said.

“We have identified significant inconsistencies between Murray Goulburn’s statements to

the market regarding its likely revenue and profits that year and the information available to the company’s management internally.

“As a result, we now have increased confidence the April 27, 2016 profit downgrade was

the result of an overly optimistic forecast, rather than any factors beyond its control.”

Murray Goulburn has noted the announcement by the legal firm and noted that no claim has yet been started. Any further comment was considered premature.

EXECUTIVES DEPART The sale of Murray Goulburn to Saputo has seen the departures of CEO Ari Mervis, chief financial officer David Mallinson and company secretary Amy Alston.

The announcement was made after the Foreign Investment Review Board approved the acquisition by Saputo of the co-op’s assets and liabilities.

MG chairman John Spark said in a statement that the sale remained a positive outcome and thanked the three for their work.

Murray Goulburn's Koroit plant will be sold by Saputo to another processor.

Farmers had little choice but to sell co-op ALMOST 70 years of history came to an end in a Melbourne building last month, when Murray Goulburn Co-operative shareholders overwhelmingly voted to sell the milk processor to Canadian company Saputo.

It was a sombre end for the processor, with many equating the $1.31¡billion sale to a funeral.

The final nail in the coffin came swiftly, with 97.9 per cent of shareholders voting in favour of the sale just six months after Saputo put forward its offer in October.

For many suppliers it was almost a foregone conclusion as many felt they had no option but to vote in favour, with Murray Goulburn’s

own chief executive officer Ari Mervis previously labelling the processor “unviable” without the sale.

Plummeting milk supply was ultimately the straw that broke Murray Goulburn’s back. The company lost more than one billion litres of annual supply¡—¡or 45 per cent of its overall milk supply¡—¡in the 12 months following the 2016 milk price crisis as hundreds of dairy farmers fled from the processor.

Saputo chief executive officer Lino Saputo Jr said the vote was a “significant milestone” in the company’s bid to acquire Murray Goulburn.

Murray Goulburn supplier director Craig

Dwyer thanked those across the generations who had helped build the company, and encouraged suppliers to “turn to the future”.

“MG has meant many things to many people; suppliers and employees alike,” Mr Dwyer told the meeting on Thursday.

“I would encourage you all to give (Saputo) a chance to prove themselves with your supply, and build on the foundations created by so many of you and your hard-working dairy farming predecessors.”

Originally established in Cobram in 1950 by seven dairy farmers, Murray Goulburn grew to 2000 suppliers and shareholders, with milk processing factories across the country includ-

ing in Cobram and Rochester, which was closed in January.

Lockington, Vic, farmer Ron Read has been an MG supplier for 35 years and said it was heartbreaking to see the end of the co-op.

“It’s a tragedy but the best result given the circumstances,” he said.

“It will never be the same now the co-op is gone. Suppliers felt part of the operation with the co-op and that bred loyalty.”

Ballendella, Vic, farmer Adam Campbell said the deal was a disappointing but necessary step.

“It’s sad to see the co-op fold but we all have financial pressures and this is the best way forward for everyone,” he said.

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DAIRY NEWS AUSTRALIA MAY 2018

NEWS // 5

Sale a chance to move forward ALANA CHRISTENSEN

IT IS time to move on.

That was the message from Murray Goulburn suppliers coming to terms with the cooperative’s $1.31¡billion sale to Canadian dairy giant Saputo.

As hundreds cast their votes in favour of selling the company, there continued to be a small band of suppliers that stood against the sale.

Gunbower, Vic, dairy farmer Stephen Brown was among the defiant 2.1 per cent who voted against the sale and said given the fate of other Australian co-operatives it seemed almost inevitable it would end like this.

“We were giving away generations of work that has been built up by generations. The whole thing is a tragedy,” he said.

“Deep down in their gut I think most farmers realise it’s a bad thing.

“There was a lot of hoo-ha about selling to the Chinese but they were offering 35 to 40

cents a share more. The Australian Government doesn’t have any issues selling to the Chinese, why should farmers be any different?”

The long and protracted sale has taken its toll on even the most loyal and positive of suppliers.

Mead, Vic, dairy farmer Dianne Bowles was left disappointed and saddened by the state of affairs, and declared she was “done” with Murray Goulburn and Saputo.

“At this stage we’re staying with Saputo but we’ll be talking to every milk company that comes up our driveway. I’m going to be dollar driven, not loyalty driven,” she said.

“I’m disappointed we got to this point and it makes me really sad. We shouldn’t have got here.

“I’m done. It’s been destroying.”

Having been a vocal supporter of Murray Goulburn in the past, Ms Bowles said she was disappointed that the board was not more transparent in what other offers or options were on the table.

However, after months of uncertainty Ms Bowles accepted this was an opportunity to move forward.

“In some respects I’m glad it’s over so we can all move on and get back to milking cows.

The dairy industry is very fractured at the moment, and competitive. I hope we can get back to the new normal and somehow support each other and move on,” she said.

The feeling that the sale of Murray Goulburn could be a healing moment for the industry is shared by many.

Mead, Vic, dairy farmer Dianne Bowles was left disappointed and saddened by the sale of Murray Goulburn.

After years of resentment and anger, Gunbower, Vic, dairy farmer Jason Hare is hoping Murray Goulburn’s final chapter presents an opportunity to leave it all behind.

He, like so many of his peers, voted in favour of the sale and said ultimately it was never going to be a situation that could please everyone.

“There’s no point in looking back,” he said.

“Hopefully going forward it’s all competitive and the milk price stays strong … You can’t dwell on it, you have to move forward and hopefully now the resentment will stop.”

MILK PRICE THE FOCUS NOW FOR SUPPLIERS With the sale of Murray Goulburn to Saputo, dairy farmers are now turning their attention to future milk prices.

At the extraordinary general meeting where suppliers gave their approval to sell the co-op to Saputo, MG chief executive officer Ari Mervis said current suppliers could expect terms “no less favourable” that their current situation until July 2023.

Saputo has committed to pay a competitive milk price that is no less than the greater price of the offer to Warrnambool Cheese and Butter, which is currently owned by Saputo, or the final weighted average of the farm gate milk price published by the two largest processors in the relevant region.

“Saputo recognises that in order to run efficient production facilities they need profitable dairy farms and a profitable industry, supported by strong milk prices,” Mr Mervis said.

With the $1.31 billion sale approved by shareholders, eligible Murray Goulburn suppliers can expect to begin receiving 80¢ per share or unit within 10 business days of the completion of the sale.

A further $114 million will be used to support the milk price, including a 40¢/ kg milk solids step up for qualifying milk solids supplied from November 1, and, on completion of the asset sale, for qualifying milk solids supplied between

July 1 and October 31 last year.

In a bid to keep suppliers, the deal will also see a 40¢/kg MS loyalty payment introduced for all eligible suppliers in the 2017–18 financial year which is expected to be paid on August 15.

As a result, the expected weighted average price for the southern milk region is estimated to be $6/kg MS for the current financial year, if the sale is completed.

Murray Goulburn chairman John Spark said final steps to liquidate the cooperative would take place following the completion of the sale.

“Once the transaction completes, MG will continue to exist and will hold certain non-operating assets and liabilities,” he said.

“A reduced board of five directors will manage the retained litigation and MG’s ongoing reporting and compliance obligations.”

Gippsland dairy farmers Kelvin Jackson and Bill Bodman, Koroit dairy farmer Harper Kilpatrick, Cobden dairy farmer Craig Dwyer, and Mark Clark will depart the board of directors, with directors Lisa Dwyer, Ian Goodin, David Gran, Brock Williams and Mr Spark staying on.

The co-operative will ultimately be completely liquidated, with proceeds returned to shareholders and unitholders.

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DAIRY NEWS AUSTRALIA MAY 2018

6 // NEWS

Support continues for burnt out farmers RICK BAYNE

COMMUNITY SUPPORT and a great level of coordination are helping south-west Victorian farmers recover after recent bushfires, but they still have a long way to go.

WestVic Dairy’s new dairy farm recovery coordinator, Helen Chenoweth, is helping to coordinate industry recovery and says the community support has been impressive.

“There has been a fantastic groundswell of support with people delivering practical things like food and helping with fencing and fodder,” Mrs Chenoweth said.

“There’s also a great level of collaboration going on between all groups in the field which is useful to pass on relevant information straight away about fodder, fencing, advice re financial needs and even emotional support to farmers who are very busy and tired.”

Despite the support, Mrs Chenoweth says the recovery process will be long and tough.

“It’s going to be a long haul,” she said. “It’s going to be a couple of years before people can get back to what we’re calling the new normal; we won’t get back to what it was the day before.”

Mrs Chenoweth, who was also involved in the recovery process after the 1983 Ash Wednesday

NIGHT FIREBOMBING APPROVED Victoria has gained approval to conduct night-time firebombing operations next fire season after successfully completing an Australian-first trial last month.

The need for firebombing was never more evident than the recent fire in western Victoria, which flared at dusk and raged all night.

Firefighters on the ground had no air support to help battle conditions veteran firefighters said were the worst they had seen.

fires, said farmers were stoic but tired. “The night fires traumatized everybody. It’s amazing no-one was killed by the fires or the traffic in those conditions.”

The fire also triggered bad memories for those affected by Ash Wednesday, which claimed eight lives in the region. “There’s still an active fire zone. People and schools went back around the Cobrico area a week or so ago which was a big plus.”

Mrs Chenoweth said fire crews did an amazing job to protect lives and the recovery process has benefitted from the experiences of Ash Wednesday and other major fires.

The south-west dairy industry also has an industry liaison group, set up after price drop hit, which was able to organise mental health support workers in those first days to chat to affected farmers.

“There was great support ready for deployment from day one,” Ms Chenoweth said.

Her role is to act as a conduit of information and to signpost people to what is required. She has been working with Blaze Aid groups helping to restore fencing in the Terang and Cobden fire regions, and with fodder support agencies.

“We’ve had up to a dozen teams of three or four Blaze Aid people going out every day.

They’re doing a huge job which has been a

The Civil Aviation Safety Authority has approved Mangalore-based Kestrel Aviation as well as Coulson Aviation to undertake night aerial fire suppression operations in Australia.

Coulson Aviation became the first in Australia to successfully conduct night fire suppression operations including hover filling from open water sources using night vision goggles.

Kestrel Aviation has also been part of the trial and gained CASA approval to operate night operations by refilling while landed on the ground.

Kestrel recently successfully completed night-time hover fills, concluding the Victorian trial, however

WestVic Dairy’s new dairy farm recovery coordinator, Helen Chenoweth, is helping to coordinate industry recover.

big plus and there are lots of talks and hugs,” Mrs Chenoweth said.

“We’ve had a lot of fodder from the north through the VFF and individual farmers which has been wonderful, and great levels of agistment and cow parking offered. A lot of those practical things kicked in quickly.”

Mrs Chenoweth said cash donations to the South West Fire Appeal would be a good way for farmers and the broader community to continue

this component is still to be assessed by CASA. Emergency management commissioner Craig Lapsley said the approvals were a key milestone and meant Victoria, on behalf of other states and territories, could continue to work through the implementation of night fire suppression in preparation for the 2018–19 fire season.

“The ability to fight fires at night is a game-changer and this is a fantastic outcome,” he said.

“It is a key milestone in an ongoing trial that Victoria has been undertaking with both operators to develop capability to attack wildfires in the late afternoon and

helping those in need.

“Then farmers will want rain and a reasonable milk price,” she added.

Mrs Chenoweth will work from the Camperdown WestVic Dairy office. The position was created to liaise with farmers, industry bodies and community organisations to facilitate recovery of farms affected by the fires. Mrs Chenoweth can be contacted at WestVic Dairy on 5557¡¡1000 or email helen@westvicdairy.com.au.

into the night using night vision goggles.”

The approvals mean that Victoria now needs to develop the policies and procedures to ensure night fire operations can be undertaken safely in real fire situations as they were in the tightly controlled trial conditions.

Mr Lapsley said the process to date had been a valuable experience to bring the issues associated with the safety of night aerial bombing together with the integration into on-ground firefighting.

“We’ll continue to test into the next summer exactly what conditions and processes are required for night operations to be undertaken safely using the helicopters that have been approved.”

DAIRY NEWS AUSTRALIA MAY 2018

NEWS // 7

Revived Brunswick cheese factory boon for WA Western Australia BROWNES DAIRY will revive the former Brunswick cheese factory in order to produce 6000¡tonnes of cheese annually.

The $10¡million investment will see manufacturing capacities developed at the south west facility, with a small percentage of the cheese will be available for purchase in WA and the rest to be exported to China as early as this spring.

Brownes Managing Director Tony Girgis said about 15 per cent of the state’s annual dairy supply

would be used to reach the 6000¡tonne per annum target, which will be reached in three to five years.

WAFarmers Dairy Section President Michael Partridge said the announcement would be welcomed by industry.

“This expansion of manufacturing capabilities is very significant for the state’s dairy industry, as the sector has experienced a difficult couple of years,” Mr Partridge said.

“WAFarmers has worked alongside industry to try to find long-term solutions to managing

the variation of milk supply, which has included accessing world markets.

“While Brownes has recognised that this is not a one-fix solution to balancing supply, it will work positively towards safeguarding the future of the WA dairy industry.

“When Shanghai Ground Food Tech purchased Brownes in November last year, we recognised the potential for the business to expand opportunities for dairy exports, particularly if local manufacturing capacities were developed.

“Four months down the track, we are pleased to see that no time has been wasted in securing this project, which will provide greater certainty for producers.”just retailers and processors, but also primary producers. The fact that these margins are not being shared equitably is a demonstration of the uncompetitive nature of the dairy supply chain.”

The Association has reiterated its support for the ACCC’s focus on agricultural related supply chains.

VDL Farms board resigns en masse Tasmania THE OWNER of Chinese company Moon Lake,

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which owns Van Dieman’s Land (VDL) Farms in north west Tasmania, has declared it is “business as usual” despite the mass resignation of directors and the CEO. Moon Lake Chairman, Xianfeng Lu, who is the sole owner of Moon Lake, said there would be no loss of jobs.

All non-executive directors of Moon Lake resigned last month, while VDL Farms CEO, Evan Rolley, will not extend his contract beyond June 30.

The former Deputy Chair, Dr David Crean, said the four non-executive directors were concerned that “proper governance arrangements are not being considered in a proposed restructure of the company’s business interests in Tasmania by sole owner and Moon Lake Chairman, Mr Xianfeng Lu”.

“The non-executive directors of the board had particular issues with the restructure arrangements relating to the running of the 24 VDL farms in North-West Tasmania,” Dr Crean said.

“The board, being responsible for overseeing the commercial and prudential operations of the VDL farms, could not convince the owner to adopt their recommendations on future management of the business.”

The board requested $2¡million to drought proof the properties but this was rejected.

VDL farms is currently running between 28¡000 and 30¡000 cattle and produces around 100¡million litres of milk, which is sold into the Chinese market.

Despite the resignations, the Foreign Investment Review Board has approved the corporate restructure of Moon Lake to Chinese Ningbo Xianfeng New Material Co Ltd (APlus), which is listed on the Shenzhen Stock Exchange.

Mr Lu released a statement saying: “As part of the restructure an Australian holding company will be set up to coordinate the Australian operations and to ensure alignmentwith overall strategic goals. Moon Lake and its sister company Van Dairy will be moved under control of the new holding company.”

Van Dairy is a sister company of Moon Lake and was set up in April 2016 to export dairy products to China.

Mr Lu said the strategic goal for the group was to become “a fully vertically integrated dairy business with quality dairy products sold both internationally and domestically”.

The board of the new holding company will appoint a new CEO for the group and a general manager for VDL Farms “in due course”.

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DAIRY NEWS AUSTRALIA MAY 2018

8 // NEWS

Bigger changes required on pricing RODNEY WOODS

PROPOSED CHANGES to the country’s milk

pricing system do not go far enough, according to a Katunga dairy farmer.

Daryl Hoey said the change proposed by Jersey Australia, which includes more emphasis on the value of milk solids, was not going to be much better than the current system.

“I fully accept it (the current system) is flawed, but I’m not convinced the proposed changes could be better,” Mr Hoey said.

“The equal weighting of fat and protein is way too simplistic.”

Jersey Australia believes the current payment system is outdated, complex and confusing, something Mr Hoey agrees with.

“I don’t disagree with that at all. We have to break open the milk pricing system so it’s far simpler than what it currently is,” he said.

Two reports commissioned by Jersey Australia and funded by Farming Together had shown pricing systems did not necessarily represent the current market value of milk components, to the disadvantage of farmers.

Jersey Australia is advocating simpler milk payments with one price for milk solids, butterfat and protein and an appropriate volume charge that penalises lower solids milk.

Jersey Australia board member Jane Sykes said

it hopes to “start the conversation” about simpler and fairer milk prices.

“We won’t be able to change it on our own; we need wider industry support and pressure at the farmer level,” Ms Sykes said.

“We understand not everyone is going to agree with the findings but we need to get the conversation started.”

Mr Hoey has another solution.

“I have an alternative that should be investigated,” he said.

“I’d like to see milk pricing of fat and protein closer to the protein-to-fat ratio and any step-up or loyalty throughout the year, should completely reflect the market place.”

The UDV says proposed changes to the milk price structure need to better represent the market value of fat and protein.

UDV president Adam Jenkins said the group had been pushing for this for a while. ‘‘From last year’s conference we asked processors to be more in line with the market,’’ Mr Jenkins said. ‘‘We have been advocating for a long time that we need to change the structure. ‘‘If you look at it as is, protein pricing is much higher than what is on the market. We need more alignment.’’

Mr Jenkins agreed with Jersey Australia that the current system was outdated. ‘‘It is ridiculous. There are 32 different levels

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of pricing structures. It’s too complex,’’ he said. ‘‘We’ve outsmarted ourselves to the point where we are paying a price to actually produce profitable milk. ‘‘Is the milk volume going up or down? It’s clearly going down. To grow milk volume, farmers need to be profitable. ‘‘You wouldn’t plant wheat in the summer and

HALLIDAY TO LEAVE DAIRY AUSTRALIA Dairy Australia has launched an international recruitment process after managing director Ian Halliday today announced he would not seek to renew his contract when it expires at the end of the year.

After nearly nine years in the role, Mr Halliday said it was time to bring in some fresh thinking to assist the Dairy Australia Board in the development and implementation of a new strategic plan.

“It has been an absolute privilege to work with the Dairy Australia team and people from right across the dairy and government sectors and I am proud of the way we’ve been able to all work together through some incredibly challenging

expect a return, so pricing needs to reflect the comparative advantage that Australia has.’’

Mr Jenkins said a whole industry approach was needed to get a simpler pricing structure. ‘‘We need industry to show leadership and we will be having more conversations around tackling pricing structures this year,’’ he said.

times,” Mr Halliday said.

Mr Halliday said he would be working with the Dairy Australia Board to ensure a smooth transition to a new managing director.

“With Jeff Odgers elected as the new Chair in late 2017 and my contract coming to an end in 2018, it’s time to bring in a fresh perspective,” he said.

Mr Odgers praised Mr Halliday’s contribution to the dairy industry during his time at the organisation.

“Ian’s leadership has brought Dairy Australia closer to farmers and that has put the organisation in a stronger place,” Mr Odgers said.

Ian Halliday.

AUSTRALIAN FIELD TRIAL DEMONSTRATES THAT TEATSEAL PREVENTS SUBCLINICAL MASTITIS TEATSEAL NOW HAS A NEW LABEL CLAIM: FOR THE PREVENTION OF CLINICAL AND SUBCLINICAL MASTITIS IN DAIRY COWS DURING THE NON-LACTATING (DRY) PERIOD AND EARLY POST-CALVING The study which gave rise to the label change was undertaken in 2014 and 2015 on 8 herds in Victoria and NSW and involved approximately 1500 cows. Cows that were not administered Teatseal (i.e. dry cow antibiotic only) were twice as likely to have subclinical mastitis in the first 60 days of lactation than cows that were administered Teatseal and dry cow antibiotic. The Teatseal group had an estimated average BMCC which was 45,000 cells/mL less than the non-Teatseal group. This represents a large potential saving for your herd by using Teatseal.

The graph below represents a herd in the Western District of Victoria and illustrates the beneficial effects on the herd’s BMCC after initiating Teatseal use in cows at dry off, in addition to antibiotic dry cow therapy. This graph clearly demonstrates a significant drop in the herd BMCC following the first use of Teatseal in the milking herd, as well as another drop in BMCC the subsequent year, when they began to Teatseal maiden heifers. Importantly, the BMCC has remained low and relatively stable in the subsequent years.

500,000 450,000 400,000 350,000

2012: Started administering Teatseal to cows at dry-off

300,000

2013: Started Teatsealing heifers

250,000 200,000 150,000 100,000 50,000

23-Feb-17

26-Oct-16

28-Jun-16

29-Feb-16

01-Nov-15

04-Jul-15

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06-Nov-14

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27-Mar-11

27-Nov-10

30-Jul-10

01-Apr-10

0

Our farm’s bulk milk cell count (BMCC) from early 2010 to early 2017 – every pick up (blue circles) and 10-day trendline (black line). Heifers start calving in May, cows start calving in June. Calving finished by October. Orange line = factory premium, green line = what we now aim to be under.

stimonial e T

“ We were having a problem with a rising cell count, heading out of premium at the end of the season.

We added Teatseal to our drying off protocol, in addition to antibiotic dry cow treatment. We had less cases of clinical mastitis at calving time, but the drop in cell count was the most dramatic result, and the daily variation in BMCC decreased as well. Happy days!”

Zoe Vogels, Scotts Creek Dairies: 2014 Countdown Silver Diamond and 2015 Countdown Gold Diamond

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DAIRY NEWS AUSTRALIA MAY 2018

GENETICS AUSTRALIA 60TH ANNIVERSARY // 11

GA expands honour roll EIGHT FARMING families who have supplied some of the best bulls to the Australian dairy industry over recent decades have been inducted on the Genetics Australia honour roll.

The new inductees were announced during Genetics Australia’s 60th anniversary dinner.

There have been just 31 names added to the honour roll in the history of the organisation.

The new names on the honour roll are Bryan and Jo Dickson of Emu Banks Holsteins at Terang in south-west Victoria; Daryl and Lani Hoey of Beulah Jerseys at Katunga in northern Vic; Lynton and Lisa Broad of Broadlin Jerseys at Lockington in northern Vic; John and Vicki Lillico of Hindlee Holsteins at Smithton in Tasmania; Ian and Peter Willcocks of Manna Farm

Holsteins at Yankalilla, SA; Colin and Narelle Bacon of Colnarco Jerseys at Lockington, Vic; Brian and Bill Anderson of Bundalong Holsteins at Kongwak, Vic, and George Wagner of Rengaw Holsteins at Winnaleah, Tas. Genetics Australia’s Breeding, Genetics and Production Manager, Peter Thurn, said the honour roll recognised breeders of bulls that had made significant contributions to Genetics Australia and to the Australian dairy industry.

“They have made an outstanding contribution through the provision of elite genetics,” Mr Thurn said.

More than 120 people attended the celebratory dinner and an open day at the Parwan Park facility in Bacchus Marsh the following day.

Deanne and Steven Hoare, Elmar Holsteins, Leitchville, at the Genetics Australia open day last month.

John and Monica Williams, Bowscowan Aussie Reds, Meningie, SA, with former GA Chair Ross Gordon.

Genetics Australia General Manager Anthony Shelly said celebrating the milestone acknowledged the foresight of those who set up the cooperative 60 years ago.

“At the same time’s we’re recognising our role today as Australia’s largest dairy artificial breeding company and a significant player in the global industry,” he said.

“We continue to be at the forefront of new

and emerging technologies.”

Genetics Australia operates three properties — Parwan Park and Parwan Park South near Bacchus Marsh and Birregurra — a total of 730 hectares — and owns a herd of 350 bulls.

It was founded in 1958 as the Victorian Artificial Breeders Co-operative. The last open day was held during the 50th anniversary celebrations in 2008.

Some of the new inductees on the Genetics Australia honour roll.

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DAIRY NEWS AUSTRALIA MAY 2018

12 // NEWS – MDBA

Time to brace for less water GEOFF ADAMS

LANCASTER DAIRY farmer Kelvin Bruce has

predicted a grim outlook for northern Victorian irrigators unless they’re properly armed for a future with less water.

Mr Bruce said Goulburn Murray Irrigation District landowners should be positioned to make the most of the upgraded delivery system.

“We have the best irrigation system in the world but currently we are not getting the best out of it,” Mr Bruce said.

“We often have visiting tour groups from all over the world coming to see our irrigation system.”

He said the region had a gravity-fed network with complementary drainage system which was being upgraded through the Connections program, and more on-farm improvements would better capitalise on the system.

“We require support for on-farm improvements which don’t involve further loss of water from the region, and help realigning the irrigation footprint to more closely match water availability,” he said.

Past on-farm efficiency funding programs had excluded farms which were not on the backbone channels, but this had penalised good farmers who were wanting to invest, Mr Bruce said.

He said now that the Connections program was further progressed and it was clearer which channels would be maintained, it was time to open up the program to more irrigators.

Upgraded farms were using new technologies to use less water with better flow rates and with less labor, Mr Bruce said, but farms not on the backbone were being excluded from these advantages. And with some irrigators excluded from the upgrades there was a danger of pushing out those irrigators.

“The fewer we have on the system the more costs we all have to bear.”

The requirement to give up water in the water efficiency programs also worked against the best interests of irrigators in this region, Mr Bruce said.

Mr Bruce, who has been vocal about his position that no more water leaves the region, said it was crucial a co-ordinated approach was adopted between on-farm and off-farm system changes that targeted reduced Goulburn-Murray Water assets.

“What we need is a consistent regional direction to allow the GMID to transition to a future with less water. A vision for the future that we all agree on with input from all stakeholders¡—¡government, industry and community.”

Mr Bruce was adamant there needed to be closer examination of the social and environmen-

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tal impacts of continued water trade to regions outside the GMID. “It is clear to me that after this current season, we need proper analysis of the risks involved with high volumes of water transferring through the river systems to meet downstream demands,” he said.

“We need strong leadership and a clear path forward if we are to remain competitive in a future with less water.”

Mr Bruce called for continued investment from government to upgrade farm irrigation infrastructure.

“Feasibility analysis shows the investment stacks up economically and provides flow-on benefits to the regional community and environment as well.”

Kelvin Bruce.

Accuracy of water data questioned THERE IS growing concern that targets to ensure a healthy Murray-Darling Basin are not being met, a South Australian royal commission issues paper says.

The Murray-Darling Basin Royal Commission paper, released last month, says it’s doubtful estimates of 2106¡Gl of water being recovered by buybacks and infrastructure investment are accurate, due to figures being “compromised by illegal take”.

“There are varying reports as to whether the basin plan, since 2012, has achieved any of its objectives of improving the health and resilience of the eco-systems and ecological functions of the Murray-Darling Basin,” the paper says.

The commission, established by the South Australian Government in January, will visit communities across the nation after first hearing from the state’s Murray Bridge residents last month.

“The commission’s terms of reference

require it to investigate matters and inform itself of issues across the entire basin,” the paper said.

Senior counsel assisting Richard Beasley said it was important for the commission to hear from people who relied on the basin as a water source.

“We anticipate this will be a significant part of the commission’s inquiry and will provide important information from local communities,” he said.

The Federal Government has not decided if it will permit bureaucrats to give evidence, while the NSW Government said it would respond to written questions.

The SA royal commission, which is being led by QC Bret Walker, will travel to all four basin states to meet with communities.

The commission was established after reports emerged of widespread water theft upstream, and its report is expected to be handed down on February 1, 2019. - AAP

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DAIRY NEWS AUSTRALIA MAY 2018

14 // NEWS

QDO to roll out Go Local campaign THE QUEENSLAND Dairyfarmers Organisa-

tion will launch its Go Local campaign by the end of June.

The Queensland Government launched the ‘Go Local, Grow Local’ campaign last year. It aims to help Queensland businesses promote their products and services, and encourage Queenslanders to shop locally.

The QDO is the first primary producer organisation to engage with the Government’s Office of Small Business to role out an industry specific

campaign.

QDO Executive Director and Marketing Manager, Sarah Ferguson, met with staff at the Queensland Government Office of Small Business last month to discuss the roll-out of the Go Local campaign.

“The current campaign has been designed as an awareness campaign; but there is a need to do more to change people’s behaviour when selecting from supermarket shelves,” she said.

“We need to create an emotional connection

to our industry and the people who are a part of it, to get consumers to stop and think about their purchase decisions.

“While the campaign will contain elements of the current Go Local awareness campaign, the creative execution will be unique to our industry.”

Sarah will assist farmers to promote the campaign in social media and other marketing channels to drive change.

She said recent surveys indicate a growing shift toward global brands across many cate-

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gories. However, the only categories which saw strong preference toward local brands were dairy and fresh foods.

“Consumers around the world prefer to source perishable goods as close to the place of origin as possible, due to concerns over freshness and quality.

“The providence of locally-sourced foods becomes one of the key deciding factors in fresh food purchase.

“According to leading research institute Canstar, 10 per cent more Australians feel that purchasing locally-sourced food is important to them compared to five years ago¡—¡a promising trend that will continue to grow into the future.”

New processor plan is No Bull Victoria AN AMBITIOUS plan to develop milk processing facilities at Cohuna is gaining momentum.

Local business interests are behind a proposal to facilitate the construction of a multimillion-dollar processing plant in the northern Victorian town.

Approval and design work is well advanced on a plant to process 300¡million litres of milk per annum, including a drying plant for export and domestic production and a possible butter plant.

Detailed analysis is being undertaken by specialists in milk processing plant design and waste treatment to ensure the facility meets the latest emission and energy standards.

Local businessmen John Mawson and Jason Wright have set up No Bull Milk Processing Pty Ltd and are the proponents of the estimated $130¡million plant.

Mr Mawson said the project had advanced to the stage of obtaining quotes for construction and that feedback from local farmers was positive.

“I can understand some people being cynical given that this project has been proposed before and that the amount of money needed is well beyond Jason and my resources¡—¡but the closure of the Murray Goulburn plant at Rochester has exaggerated the need for farmers to have some place close to have their milk processed efficiently,” he said.

A number of domestic and international enterprises have expressed interest in building and operating the plant.

Mr Mawson said the scope of the project would involve attracting milk from farmers in a broad region.

“It’s not just for around Cohuna,” he said.

International commodity consultants have compiled financial forecasts and budgets for No Bull Milk Processing Pty Ltd, and are working with the support of Gannawarra Shire Council economic development manager Roger Griffiths.

Mr Griffiths said the shire had been involved in fortnightly meetings with key stakeholders and Regional Development Victoria had provided introductions to key infrastructure connections.

Mr Mawson said he hoped the plant would be operational by the second half of next year.

DAIRY NEWS AUSTRALIA MAY 2018

16 // OPINION RUMINATING

EDITORIAL

Farmers deserve real competition for their milk

MILKING IT...

Up, up. Prices are up Funny how a corporate bully can change its tune when losing money faster than you can say ‘rotten retailing practices’.

The mob that brought $1/litre milk to Australian consumers said recently shoppers are willing to pay more when cost increases bump up supermarket prices.

Coles has been shifting its sales pitch to consumers away from being intensely focused on price to highlighting service and quality.

Wesfarmers managing director Rob Scott said as Coles’ competitors were behaving “rationally” and passing on cost increases to consumers, Coles could do the same.

Somehow we don’t think that will involve lifting the price of milk and cheese in their stores — bloody hypocrites.

Cottage cheese Our dairy products columnist, Madeleine Brennan, has never been afraid to ask the hard questions, and so it was last April when she opined: What is the point of cottage cheese?

Fair to say, she made her feelings pretty clear.

We quickly received an email from a marketing manager asking if anybody wrote to defend the product (they didn’t) and that his company was trying to reinvigorate it.

Seems he’s not alone.

US company Smith Foods is “adding excitement to the cottage cheese subcategory via flavor innovation and single-serve packaging” via its Artisa brand.

Smaller snack serve portions and added fruit — somehow, we don’t think that’s going to cut it.

After all, if it looks like a duck …..

Flavour enhancer

Back to glass

Varieties of Coles chocolate being marketed as suitable for vegans have been recalled after it was found they contained, you guessed it, dairy.

Coles has apologised for the mistake but has found itself in a world of trouble, as vegans target their anger at the supermarket, instead of law-abiding farmers for a change.

We wonder if the aforementioned vegans are upset because they liked the taste before realising what the secret ingredient was.

It reminds us of a young country boy many years ago that turned vegan and visited his mother and father for dinner.

When asking why there was bacon in the ‘vegan’ quiche his mother had prepared, she replied: “Oh you need a bit of bacon for flavour.”

Never a truer word spoken.

Advertising James MacGibbon

People are switching from plastic to glass milk bottles in the UK. Most dairy businesses have reported a rise in sales, including a return to the traditional delivery of milk in glass bottles to doorsteps.

This trend has surged this year as people reduce their use of plastic.

Milk delivery services have continuously declined since the 1990s.

According to DairyUK, the latest delivery figures are one million milk pints per day — about 3 per cent of all milk sales (including glass and plastic deliveries).

Of the 20 milk-distributing businesses that got in touch with the BBC, 85 per cent have seen an increase in glass bottle sales.

How long until we see it in Australia?

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james,macgibbon@dairynewsaustralia.com.au Editor Stephen Cooke Dairy News Australia is published by Shepparton Newspapers Pty Ltd. All editorial copy and photographs are subject to copyright and may not be reproduced without prior written permission of the publisher. Opinions or comments expressed within this publication are not necessarily those of the staff, management or directors of Shepparton Newspapers Pty Ltd.

There was genuine sadness at the Melbourne meeting where Murray Goulburn shareholders voted to sell their beloved co-op to Saputo.

Even though almost 98 per cent agreed, all those did so with a heavy heart. There was no choice left after years of poor management.

Those farmers want to move on and it is hoped that the sale to Saputo will bring a genuine competitiveness both on the world stage and in their pursuit of milk.

Further international sales, including into Asia, will see demand for Australian milk grow, and competition with Fonterra within Australia will continue to aid the recovery of suppliers, still recovering from the decision of both processors two years ago to slash prices overnight.

Suppliers not only deserve it but desperately require it.

Some analysts say the outlook for future milk prices is encouraging, despite another wall of milk emerging on a global scale.

We genuinely hope that processors in Australia offer sustainable prices to attract suppliers so we don’t have a repeat of the events of two years ago. Surely they’ve learnt their lesson.

Rabobank has bullishly stated that competitive pressure for milk supply will translate into higher premiums being passed to farmers and help compensate for the lower commodity price.

It sounds like having your cake and eating it too but the prediction is based on a gradual tightening in dairy markets late in the season.

So a conservative opening will lead to step-ups throughout the season.

The prediction is also based on growing the national milk pool to fill all the stainless steel being built around Australia. Not filling it will lead to inefficiencies, which would place pressure on processors.

The majority of Australian farmers have shown they’re in dairy for the long haul, with many that have scraped through the last two years knuckling down to rebuild their asset.

Genuine competition for their milk is what the industry needs, as long as it is sustainable — and that has never been more important.

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Stacey Taylor

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Head Office 7940 Goulburn Valley Highway Shepparton, VIC 3630 Phone (03) 5831 2312 Postal address PO Box 204 Shepparton, Victoria 3632 Australia

DAIRY NEWS AUSTRALIA MAY 2018

MARKETS // 17

Increased competition will lift farmgate prices INCREASED COMPETITION for milk will steer farmers towards a profitable 2018–19 season, according to Rabobank senior dairy analyst Michael Harvey.

In a new report for Rabobank, Australian Dairy¡—¡Let the big milk battle begin, Mr Harvey writes the “battle between two global dairy giants looms large on the horizon”, as Saputo’s quest to win back milk supply begins and Fonterra maps out further capacity expansions.

Further increasing competition are smaller and newer dairy players actively recruiting milk to secure their share of the milk pool.

Mr Harvey said these competitive pressures for milk supply, which are likely to intensify next season with Saputo’s acquisition of Murray Goulburn, will translate into higher premiums being passed to farmers and help compensate for the lower commodity price.

“In the global market, while risks loom in the near-term and this is likely to see dairy companies take a conservative approach when opening their prices for the 2018–19 season, the prospects for a gradual tightening in global dairy markets is bright,” Mr Harvey said.

He added: “The timing of the recovery is expected to favour Australia by taking place through our seasonal peak in production.”

Assuming a spot currency rate of US77 cents, Mr Harvey said Rabobank forecasts the global market to deliver a base farmgate milk price of A$5.40/kg milk solids (MS) in 2018–19.

“However greater competition for milk is likely to bring higher value-add payments to Australian producers with Rabobank forecasting an annual average farmgate range across southern Australia of A$5.40¡kg/MS to A$5.90¡kg/MS in 2018–19.”

Rabobank is forecasting domestic milk production to increase by 2.7 per cent in 2018–19 to deliver an additional 170¡million litres of milk to the market. This follows the 3.2 per cent increase (or additional 390¡million litres) in 2017–18.

“A well-timed autumn break will be vital to setting up the season,” he says, “with increased purchased feed costs and lower cull cow prices expected to place some pressure on margins.”

Mr Harvey said Australian dairy farmers preparing for the new season would need to budget for higher feed costs, but also factor in the cash flow implications of a conservative opening price and lower non-milk income.

“The reality is that 2018–19 may be characterised as another season of consolidation due to looming market pressure, however margins are on track to remain above breakeven,” he said.

Big battle for milk looms Given the increase in Australian milk supply and the gradual repositioning of the milk pool, the report says a “big battle for milk looms” between processors, to retain producers next season and to be in a position to grow their milk supply in the longer term.

“At the frontline of this battle are the two large international companies butting heads over milk supply as Saputo looks to win back milk supply and Fonterra maps out capacity expansions,” Mr Harvey said.

“With the Murray Goulburn asset footprint having an excess capacity of more than one billion litres, Saputo will be looking to win back that lost milk supply.

“And then you have a number of dairy companies that have already taken up the lost milk from Murray Goulburn and they will be determined

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to retain their recently-acquired milk suppliers.”

Mr Harvey predicts Australia’s dairy processing capacity will increase further over the next two years, with an estimated 900¡million litres of capacity to be built.

“This comes off the back of one billion litres of commercially-viable processing capacity coming on board in the past two seasons.”

In light of the increased processing capacity, Mr Harvey said Australia’s dairy sector needs to ensure sustained milk supply growth continues.

“Without a growing milk pool, the industry risks carrying too much surplus processing capacity, fuelling manufacturing inefficiencies, with the

Michael Harvey.

margin pressure just ‘pin balling’ from one processor to the next.

“And this is a looming risk for the sector because if it faces another sustained period of aggressive milk pricing, it could potentially transform into an unsustainable squeeze on processors margins and profitability.”

DAIRY NEWS AUSTRALIA MAY 2018

18 // MARKETS

Australia becomes more entwined with global markets rt demand remains strong

few now rmming sed cortier mer For ted e to the ems erm and

ook es – Sitan 0/kg nge The picors sitthe

on mers orm acts ply.

DAIRY NEWS AUSTRALIA JUNE, 2012

AGRIBUSINESS // 17

(-0.3 per cent) and Queensland (-5.4 per cent) with Victorian milk production still ahead by and total volumes out of the EU flat.

Perhaps more extraordinary is the trade in 3.7 per cent on an YTD basis, a projected total show an altogether different trend.

Severe three month rainfall deficits have national milk production of over 9,200¡million infant formula. cents/litre in MarchAustralia (AUD 41c/L) to 28significant quantities of imports litres(year-on-year) still looks probable. developed across much of in east and southeast Incremental change milk production Euro cents/litre (AUD 36c/L) in April.

Available data from Australian manufactur- retail-ready infant formula, primarily from New Australia, along with severely depleted soil Profitfrom margins under pressure in sold the on the shelves of Auswhich are ers continues to show a shift away the areZealand, moisture levels.

US,towards and in NZ has announced tralian supermarkets and pharmacies. the Fonterra Whilst parts of New South Wales and butter/SMP manufacturing stream on available Queensland have been experiencing these production of Cheese and WMP, as themanufacturfinal payout forBased the 2011/12 season ABS data, Australian of infant formula offcut ered challenging conditions for a while, the effects ers respond to the better overall returns has been fromimports NZ$6.75-$6.85/kg MS have grown by 62 per GLOBAL IMPACT cent this year, and are on track to hit almost by this stream. are beginning to show further south, with total to NZ$6.45-$6.55/kg MS (AUD$4.96GLOBAL IMPACT JOHN DROPPERT 50¡ 0 00¡ t onnes by the end of 2017–2018.

Alongside these changes in Australian manVictorian milk production for March up just LAURIE WALKER $5.04).

For some perspective, ufacturing mix, the composition ofEffectively, Australian global 0.1 per cent. dairy markets are in 2011–2012 Australia imported just 6000¡tonnes of infant formula.

Prolonged lack of rainfall, severe dryness imports also appears to be changing. rebalancing. Lower prices will both Shifts in private label contracts and proWhilst there is a lack of clear data on the Based on Australian Bureau of Statistics AUSTRALIAN DAIRY farmers produced and record breaking temperatures for April conslow production growth and stimulate cessor rationalisation have seen milk an estimated 650¡million litres in March, an tributed to poor pasture conditions and bush- (ABS) import data to February, the growth subject, actual domestic demand seems unlikely demand, and as this occurs we will ulticompanies adjust their intake requirefires in western Victoria, with milk production in Australian cheese import volumes appears to account for all, or even most of this increased increase of 2 per cent on March 2017. seecent, a pricedemand. recovery. Key factors ments and pricing to meet the changof 5 per On current numbers, this means Australian volumes down 3.9 per cent and 2.1 per cent in much more subdued in the ordermately to watch on the global scene will be the ing demands of a highly pressured retail Since 2010–2011, ABS data shows that the or on trend for around 120¡000¡tonnes for the milk production for the 2017–2018 season is Gippsland and western Victoria respectively. rate at which milk production overseas marketplace.

Lower contract prices and Australian infant population (ages 0–3) has Whilst the BOM’s latest Climate Outlook full 2017–2018 financial year. ahead by 3.4 per cent on a Year-To-Date basis, in response to lowerfrom prices, the a lack of alternative supplyseason. opportuni1.17¡ million to slightly over Whilst still a record amount slows of cheese, this increased suggests above average rainfall for parts of eastcompared to the 2016–2017 1.25¡mfinancial illion in 2016–2017, growth isAsia signifi cantly less than impact the surge of seen the current worries for a growth rate of Victoria and northeast much in ofsouth-east and the Middle March production up strongly in ern 2012 milk production in Tasmania, the US those ties present challenges was in a market with flows.

1.0 per cent,the whilst in 2016–2017, when cheese imports grew by an confidence, is expected in June.

South Australia (aroundcapacity.

12 per cent), Tasmaon consumer pathsales of of infant formula have consistently higher ecois up this around 4% on 2011 for the year to East maintain limited manufacturing Despite by and around per cent annually over the astonishing per cent.

Theyear lackadjusted), of a properwhilst autumn breaknomic and the growth nia (around 11 per the cent) and Northern Victoria growth, the 12 value rates26that support China’s economicgrown April (leap early these challenges, underlying domesperiod.

Thisconsumption. growth has come entirely the US, same ects ofmilk the Stproduction Patrick’s Day Fires will dairy (around 7 per cent), with whilst growth in drinking offrom the Australian dollar. increased Howdata ongoing suggestseffEU-27 tic market is stable, steady per-capDemand from the so-called Daigou, shoppers with cheese imports from New Zealand down, continue to aff ect milk production, however milk oriented states such as New South Wales Demand for exported dairy prodita dairy consumption and a growing finished the March 2012 quota year up ever, the surge in supply has outpaced

population providing a degree of certainty beyond the current adjustments.

In the seasons following the 2008 financial crisis and subsequent commodity price recovery, farmers in export-oriented regions have seen solid global supply growth (see chart) - with higher-cost competitors in the Northern Hemisphere amongst those expanding output as their margins increased.

This season, favourable weather conditions have further enhanced milk

2.3% on the previous year. New Zealand production is widely expected to finish this season up 10% on last year - a huge market influence given 95% of NZ milk is exported. Argentina is also enjoying solid production growth, but a significant supply gap in Brazil prevents much of this additional milk from leaving South America.

Despite wider economic uncertainty, demand has remained resilient as importing countries like China and

demand growth in the market.

This situation has seen the scales tip in favour of buyers in dairy markets, with commodity prices retreating steadily over recent months. Butter prices are down some 30% from their 2011 peaks, whilst powder prices have lost more than 20%. Farm gate prices have subsequently been reduced in most exporting regions. The average basic farm gate price for milk in France for example, dropped 12% from 32 Euro

ucts remains a positive and will continue to grow with the middle class in large emerging markets such as China, with changes in diet and with increasing urbanisation - and also in conjunction with global population growth. Locally, the domestic market is supported by a growing population and stable percapita consumption. Whilst the dairy market is currently a challenging place to be a seller, all signs indicate that balance will ultimately return.

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Sealing the deal: Malaysian Mustapha Mohamed hile under the with Australian counterpart Craig Emerson after signing the deal.

FTA agreement of Australian agribut also through technical Despite the compleers through streamlining e’s key interests or so called ‘behind the tion of this agreement, of rules-of-origin decriffs bound at zero, much remains to be done border’ restrictions.” and rice are two sec- laration processes and The FTA was signed on for Australia’s farmers to improved marketing here incremental May 22 in Kuala Lumpur tap into the full potential arrangements for certain t access improveby Australia’s Trade and of the Asian region and commodities. have been negotiCompetiveness MinisThe Malaysian market beyond. nder the Malaysian ter Craig Emerson and his He says the NFF will is worth about A$1 bilMalaysian counterpart now throw its attention lion in Australia agriculhis trade deal was

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Foods plant targets Asia AUSTRALIAN FOOD

company Freedom Foods Group Ltd is to build a new milk processing plant to cash in on growing demand in Asia.

The plant, to be built in southeast Australia, will be the first Australian greenfields expansion in UHT in 10 years.

Freedom’s wholly owned subsidiary Pactum Australia will run the plant. Some of its products will be sold in Australia.

The company says given Asian consumers’ rising incomes and improving diets, demand there will grow for qual-

to provide portion pack (200-330ml) configuration for beverage products.

The NSW location will provide access to the most sustainable and economic source of milk. Pactum has strong links to the Australian dairy industry and will expand its arrangements with dairy farmers for supply of milk. The new plant will increase scope for Australian milk supply – value-added, sustainable and export focused.

Initially the plant will produce 250ml and 1L UHT packs from a process line capable of 100 mil-

DAIRY NEWS AUSTRALIA MAY 2018

MARKETS // 19

who buy this product off Australian shelves and then re-export to countries such as China via unofficial channels, may explain some of this phenomenal growth.

This same demand for Australian infant formula has also seen continued growth in direct Australian exports, with export volumes up 34 per cent YTD, and on track to exceed 30¡000¡tonnes by the end of 2017–2018.

Close to 90 per cent of this infant formula is exported to China and Hong Kong, where Australian dairy products attract a significant premium.

In 2016–2017, Australia exported around 24¡000¡tonnes of infant formula, worth $US310¡million, whilst importing 30¡000¡tonnes worth $US240¡million. The case of cheese or infant formula also illustrates a key point worth considering in light of the ongoing change and disruption in the Australian dairy industry.

Namely, that the global market is going to become more, rather than less important, for the Australian dairy industry.

Historically, Australia’s position as an exporter has always been around the idea of producing more than we could consume, creating a marketable surplus that could be sold into markets at a price lower than our competitors.

Now faced with a larger domestic population and smaller total milk production, the marketable surplus equation is undoubtedly smaller than it used to be.

Secondly, Australia’s status as the lowest

cost producer is less assured than it used to, as a combination of factors have led to rising costs and more intensive production methods.

Australia certainly exports less both in absolute terms, and as a percentage of milk produced than it did immediately after deregulation.

However, when faced with the latest industry crisis, a fall in milk production did not necessarily lead to a decrease in Australian exports, however imports did increase noticeably.

Backed by Free Trade Agreements, Australian companies have a number of high value export markets, that if forced to make a choice due to limited milk supply, they will service ahead of segments of the Australian market.

Conversely, Australia also has Free Trade Agreements with two major dairy exports (New Zealand and the US), and is negotiating a further one with the EU. Like it or not, Australia is locked into the global dairy market, through Free Trade Agreements and the presence of multinationals such as Fonterra and Saputo, which have global ambitions, with supply chains and strategies to match.

Australia is now an importer and an exporter of dairy products, and as shown in the case of infant formula can be a net importer by one measure and a net exporter by another.

Cheese Imports by Origin 140000

120000

100000 57 774 80000

65 723

60000

55 030

45235

39 623

23 863

40000 23 847 20000

17 790

18270

21 086

16324

16859

11 821

2014/2015

2015/2016

2013/2014

AMERICA - NORTH

EUROPE - EU

With this in mind, the idea of two distinct domestic and export markets for most dairy products appears increasingly irrelevant, meaning that rather than retreating from world markets to focus on satisfying local demand, the Australian dairy industry will become only more interlinked with global markets.

21 136

37 507

2016/2017

2017/2018*

NEW ZEALAND

OTHER

While this offers opportunities, it is not without its challenges as the industry heads into new territory with the 2018–2019 season approaching.

• Laurie Walker is an industry analyst with Dairy Australia.

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20 // MARKETS

A strange time for US dairy

FRESH AGENDA STEVE SPENCER

WE’VE BEEN in the US recently, the focal cheese and butter, flowing back as lower milk point of our travel being attendance at the prices.

Luckily feed grain and oilseed markets are in annual American Dairy Products Institute a glut, keeping feed input costs to dairy farm(ADPI) conference.

The ADPI is a very large event on calen- ers steady. The situation would have been far dars for processors, traders, brokers and buyers worse.

Now add engaged in the US the complexity domestic and also of the Trump the global indus- Dairy farmers in the US are quick to point out that they’re in the Administration, try. which affects About 1200 to fourth consecutive year of poor only the 1500 turn up to farm margins, and that 2018 looks not future health this event, held of the economy, in late April each to be the worst of those but trade policy year in downon several fronts and continued access to farm town Chicago.

While there is a conference going on at this labour supply.

The trade policy calls by Trump have been event, with a large agenda covering market and technical content, most of the activity is jaw-dropping for the dairy sector¡—¡let alone the For much of the past year, milk output in the USA has grown at a faster rate than domestic demand for dairy products, mainly because the fast food market slowed. in one-to-one business meetings off to the side. rest of agriculture.

In reality the conference proceedings are the sideshow.

The event is held each year when spring is theoretically underway in this city, but the weather is uncertain and volatile¡—¡daily maximum temperatures can swing from close to freezing to the low 20s¡—¡from day to day.

This seems strangely appropriate this year, as the environment for the US dairy industry at least is uncertain and the sentiment highly variable.

The “windy city” apparently got its name not for the vagaries of climate but for the bluster of its politicians¡—¡so it’s even more apt to be pondering the future of the US dairy industry in Chicago this year¡—¡although all the hot air is coming from Washington via Fox News and Presidential Twitter.

The US dairy industry is facing a few challenges, but the extra layering of complexity brought by Donald Trump’s Presidency has added to the uncertainty.

Dairy farmers in the US are quick to point out that they’re in the fourth consecutive year of poor farm margins, and that 2018 looks to be the worst of those.

Yet milk production keeps growing. For much of the past year, milk output has grown at a faster rate than domestic demand for dairy Donald Trump during his Presidential campaign in 2016. Many of Trump’s supporters in the agriculture sector could be experiencing some buyers’ products, mainly because the fast food market remorse. (AP Photo/Andrew Harnik) slowed.

The irony is that as the economy has The main gripe of the US industry¡—¡echoed with Japan, which is still a major cheese market!

At a time when China has proven to be a key improved, people tend to trade up, eating fewer Meanwhile many busloads of immigrant farm fast food¡—¡and therefore dairy-hungry¡—¡meals. balancing market for global dairy trade, Trump by Trump’s team¡—¡is Canada’s restrictive tarworkers have been rounded up and removed Fluid milk consumption continues to slide picks a fight over imports to the US from China iffs and internal supply management system.

While it has been recently reported that a from dairy farms over the past year. against the onslaught of alternatives and rising of steel and aluminium (“aluminum” in these This has reduced the farm labour supply and consumer concerns about hormones in milk and parts), which has escalated into tit-for-tat retal- revamped NAFTA is close to being finalised, iation designed, from the Chinese perspective, Canada has not backed down from maintain- increased farm costs in the major South-West the environmental impacts of livestock. and Mid-West regions of the US industry.

As US milk production rises and the domes- to hurt Trump’s support base¡—¡factory work- ing key components of its arrangements.

For a sector that is predominantly RepubIronically the TPP (under the Obama admintic market falters, exporting is the obvious ers and farmers.

The scrap hasn’t directly impacted dairy istration) was formerly seen as a mechanism to lican in outlook, many of Trump’s supporters answer¡—¡right? modernise NAFTA, but Trump has been keen in the agriculture sector could be experiencing While the US has tried to step up dairy trade, trade, but that step may come next.

Trump pulled out of the Pacific Rim free to trash “anything Obama did” and out went some buyers’ remorse. the global market hasn’t grown at all in the past While the US dairy industry has been poised trade bloc, the TPP, which improves access to that strategy. year.

The protectionist stance of Trump’s Admin- to take a more strategic approach to global marDespite a stronger world economy, some of a number of ASEAN countries and Japan, but the key markets for dairy are much weaker¡—¡the now seemingly wants back into the tent¡—¡or istration has weakened the competitive posi- kets for some years, it is now swimming against tion of the US in trade¡—¡key competitors, such a rising and unpredictable protectionist tide.

Middle East, North Africa, and the oil econo- not, depending on the day.

The NAFTA agreement presently includes as the EU, have gone about improving market Stay tuned. mies of Russia, Africa and South America are • Steve Spencer is a director of collectively buying far less than in recent years. open trade with Mexico, the most important access through FTAs, including an agreement The outcome has been weaker prices for export market for US milk powder and cheese. recently reached with Mexico, and an FTA deal www.freshagenda.com.au

DAIRY NEWS AUSTRALIA MAY 2018

AUSTRALIAN BREEDING VALUES – APRIL 2018

// 21

$300 bonus per cow from proven bulls STEPHEN COOKE

USING HIGH genetic merit bulls can improve gross margin per cow, with new research showing the top 25% of cows averaged a $300 margin over feed and herd costs annually, compared with cows in the bottom 25% of the herd.

These results, gathered through research as part of the Improving Herds program, were shared by Data Gene Genetic Evaluation Manager Michelle Axford at the Genetics Australia open day last month.

Ms Axford said dairy farmers often question her on whether choosing higher genetic merit bulls, as ranked in Australian Breeding Values, has a commercial result on farm.

“I’m often asked: Does this stuff work? Does it make a difference?” she said.

One of the goals of the Improving Herds program is to evaluate the contribution of genetics to herd profit.

The basis of the project is the Balanced Performance Index.

“BPI is the one we focussed on most for this project,” Ms Axford said. “BPI is half production but the other traits that contribute to profit are fertility, cows that last a long time, have low cell counts, and are easy to work with.”

Data for the project was collated from 27 focus farms located around the country¡—¡incorporating different regions and different sizes.

They collected herd records, detailed financial data and genomically tested heifers, which enabled them to compare the high and low BPI cows within a herd.

“What we found was across all animals, there’s a wide range in gross margin of those

animals. Some lost as much as $1290 because essentially they didn’t get past the first gate.

We invested money to rear that animal but they only lasted in the dairy for a short time.

“At the other end, cows were generating gross margin of over $2000 per year.”

On average the top 25 per cent of cows produced $300 per cow more than the bottom 25 per cent. This was the margin over feed and herd costs each year.

To get the $300 figure, income was derived from milk income, calf income and cull income, minus rearing cost, feed cost, mastitis cost, repro cost and herd cost.

Toby and Nick Leppin, from Bena, South Gippsland, are one of the Improving Herds focus farms.

“In their case, their top 25 per cent of animals produce a lot more milk. To do that they need more feed, so there are higher feed costs, but the gap between income generated minus feed costs in their case was a $268 margin over feed cost per cow per year.

“The high BPI cows generated more fat, more protein, and lasted 10 months longer in the herd.”

Ms Axford said the research was backed up several other studies, including– Feeding the Genes, which measured 500 herds across five different feeding systems.

“In all five feeding systems, those high BPI cows produced more and lasted longer.”

The Improving Herds program is funded by the Gardiner Foundation, the Victorian Government, Dairy Australia, Data Gene, Holstein Australia and the National Herd Improvement Association of Australia.

Michelle Axford with Improving Herds Focus farmers Jared and Courtney Ireland, Redmaw Holsteins, Lockington, Vic, with their son Logan.

High BPI cows Milk (L) Fat (kg) Protein (kg) Fat (%) Protein (%)

295 more L/cow/year 40 more kg/cow/year 27 more kg/cow/year

• Longevity — high BPI cows lasted 10 months longer in the herd

0.36% more kg/cow/year 0.22% more kg/cow/year

Improving Herds research from high BPI cows owned by Toby and Nick Leppin, Bena, South Gippsland.

Rate of genetic gain soars THE RATE of genetic gain in the Austra-

lian dairy herd has almost doubled in the past decade, according to a recent analysis.

DataGene announced the results with its April release of Australian Breeding Values (ABVs).

Rates of genetic gain for BPI in Australia Holsteins in different time periods 25.0 19.4

20.0

20.1

15.0 10.0 10.0 5.0 0.0 2005-2009

2010-2014

Year of birth of cows BPI of sires of cows

Average 205-2017

2015-2017

DataGene Genetic Evaluation Manager, Michelle Axford, looked at the rate of genetic gain for Balanced Performance Index (BPI) in Australian Holsteins in 5-year time blocks, based on the BPI of the sires of cows.

The average rate of genetic gain since 2005 was about $15.80/year (green line in the graph), while the current rate is more than $20, which is double that of in 2005–2009 ($10).

A number of initiatives are likely to have contributed to the acceleration in genetic gain, including the introduction of the Good Bulls Strategy in 2010, genomics in 2011 and dairy’s three new indices in 2015.

“The easiest thing farmers can do to improve genetic gain in their herd is to buy semen straws that carry the Good Bulls logo,” Mrs Axford said.

Bulls that carry the Good Bulls logo meet the minimum criteria for Balanced Performance

Michelle Axford.

Index, reliability and are available for purchase.

There is a wide range of Good Bulls, giving farmers plenty of choice for Good Bulls that meet their priorities for specific traits, budget and company preferences.”

“Encouraging farmers to use a Good Bulls straw to breed every replacement has been a collective effort. Bull companies, AI service providers, farmers, researchers and industry all play important roles.

“It’s very exciting to see a jump in genetic gain in Australian dairy herds. The benefits will be long lasting because genetic improvement is permanent and compounds every year,” she said.

DAIRY NEWS AUSTRALIA MAY 2018

22 // ABVS – APRIL 2018

Silverline the cream of the crop RICK BAYNE

JUSTIN JOHNSTON thinks “we’re getting there” when it comes to breeding top quality bulls.

The facts and figures indicate they might have already arrived.

According to the latest ABVs, Justin, who farms with his parents Robert and Lynette, near Sale in eastern Victoria, has bred Australia’s number one ranked Holstein bull, Silverline.

The Johnstons have also experienced success on the show circuit.

The top Australian bred genomic bull is now with the Genetics Australia stable. He was bred by the Johnston family’s Glomar Holsteins and has a BPI of 352 with a 65 per cent BPI reliability.

It’s a case of double success for the Johnsons who also had the number one Australian bull last year with Super Lucky.

Silverline is in good company. Genetics Australia also has one of his brothers, Mainstreet, who has a BPI above 260 and also has very good

type and always has milking daughters.

“He’s looking pretty good and improves every time,” Justin said.

Silverline is showing similar improvement year-on-year. “There’s only one way forward; he’ll keep going up. He’s already the best we’ve had.”

It hasn’t been overnight success. “We haven’t previously had number ones but Dad has been breeding bulls for Genetics Australia for the Australian market for 30-odd years and in that time there have been quite a few good bulls,” Justin said.

The farm has been pure-bred Holsteins since 1968 and the Johnstons are happy with their choice.

“I like how they’re a bigger cow than the Jerseys and not as moody. Their percentages aren’t as good but you get more milk,” Justin said. “I appreciate the other breeds; they’re good cows too but we’ve always liked Holsteins.”

The Johnstons have used a dedicated system to develop a bull that’s good for their land and for Australian farmers more generally.

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ABVS – APRIL 2018 // 23

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production but also with very good type,” Justin said. “Our aim is to breed a cow that could win Dairy Week but also has highest genomic numbers that could breed a bull for the AI system as well. We’re getting there.”

Apart from the ABV success, the Johnston’s Glomar McCutchen Annecy won champion heifer at the 2017 Melbourne Royal Show and at Dairy Week. She also has a daughter doing very well on the BPI system.

They also have the number one type bull on genomics in Australia and the number one genomic cow, Glomar Goldwyn Lucky 4319. Her full sister, Glomar Goldwyn Lucky 4475, is the mother of the number one genomic type bull, named General.

“It’s a very good family,” Justin said.

The success follows “years and years of choosing bulls that fit our breeding goals of milk, type and facility, not just focusing on individual traits but more the bull as a round figure”.

At the moment they’re using mostly American sires, believing the quality of options in Australia to be variable. “We’re in a stage now where we’re looking for conversions on both systems, the TPI and the BPI,” Justin said.

“That’s our next goal so if we can get something that comes on both systems and converts well we can cover all markets.”

The Johnstons milk 880 and when they’re all in this year there will be about 1150, which Justin admits is a few too many.

They have about 600 hectares under irrigation and nearly 700 hectares of dryland farm.

Turning 30 this June, Justin has dedicated his past 10 years to the farm and the Holstein stud after spending two years playing baseball in the United States.

Now he’s looking at a new venture with the launch of his semen company, Shamrock Genetics.

“We thought we could provide a service to the industry at a reasonable price and help farmers out a bit,” he said. “We’ve got the animals there and it’s a different avenue for the business.”

Shamrock Genetics has exported embryos to Ireland and is negotiating the sale of embryos and semen to Pakistan.

“It’s a whole new branch for us,” he said.

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DAIRY NEWS AUSTRALIA MAY 2018

24 // ABVS – APRIL 2018

Beulah Jerseys retain number one ranking KATUNGA FARMERS Daryl and Lani Hoey, Beulah Jerseys, have retained their position of top Jersey herd in the April ABV release, with an average BPI of 122.

Having maintained the title of best Jersey herd for more than a decade, Mr Hoey places the reason behind their success on a considered and consistent effort.

Milking more than 300 cows on their 150¡ha property, which comprises 60 per cent Jerseys and 20 per cent of each Holsteins and Australian Reds, Mr Hoey said the accolades had taken years of work.

“I’ve just spent many years obviously using the right bulls,” he said.

“I pretty much only use bulls based off the Australian system and I’ve always placed a lot of emphasis on protein, production overall and fertility. They’ve probably been the priority, and then udders after that.”

Mr Hoey places a strong emphasis on fertility and said considering the issues that had occurred across the Australian dairy cow population in past decades, it was always a key factor in his selections.

“It’s just something I think we can do better at. We’ve spent probably 15 years not placing

enough emphasis on it and ended up with definitely a fertility issue across the whole population, and it’s a slow process to fix it,” he said.

“I think fertility is a big driver in profitability.

I still want my cows to calve every 12 months.

We don’t always achieve it, but that’s the goal.

“So by trying to place my emphasis on fertility, hopefully (I can) try and fix a lot of the problems that have happened across Australia in the last 20 years.”

While Mr Hoey places great considerations into the genetics in the herd, he maintains that it’s about improving the overall herd and ensuring it will ultimately suit Australian conditions and deliver quality production.

“It’s still the milk cheque that pays the bills,” he said.

The Hoeys were inducted on the Genetics Australia honour roll at the genetic co-op’s 60th anniversary dinner last month. They are among 31 breeders added to the honour roll in the history of the organisation.

Genetics Australia’s Breeding, Genetics and Production Manager, Peter Thurn, said Beulah Jerseys’ big contribution to Genetics Australia has been through bulls like Tahbilk, a former number one Jersey sire, and Badger, one of the

Daryl Hoey.

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“Badger has made an impact not just in Australia but all around the world,” Mr Thurn said.

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DAIRY NEWS AUSTRALIA MAY 2018

ABVS – APRIL 2018 // 25

Better facilities raise mating results ONE OF the most unpredictable places to be in a dairy shed is arguably the back end of a cow.

That’s a place artificial breeding (AB) technicians simply can’t avoid. It’s the business end, and their success in this area can depend much on the environment and facilities they have to work in.

AB manager for LIC in New Zealand, Dave Hale, says both the farmer and the AB technician want the same thing¡—¡to get cows in-calf when first presented¡—¡but the role facilities play in this is often overlooked.

“It’s widely acknowledged that a number of factors can impact a cow’s ability to get incalf¡—¡from body condition score to accurate heat detection,” Mr Hale said.

"But maybe not so well recognised is that poor facilities, unnecessary distractions and uncomfortable work environments can prevent even the most skilled AB technician from doing the best job possible.”

LIC bulls sire up to 80 per cent of New Zealand’s dairy cows, with most inseminations done by about 840 AB technicians.

Before the peak AB season starts in spring, staff visit farms to check AB facilities and discuss how these could be improved to achieve a better result at mating time.

Hale visited about 250 farms last year in his role, and says he saw a wide range of AB facilities.

“While it’s clear some farms have spent a lot on facilities, some of them leave a bit to be desired. This will be impacting their results.”

DairyNZ says poor AB facilities can reduce

conception rate by up to 10 per cent.

“We want our farmers to have the best chance to get their cows in-calf when they’re first presented,” Hale said.

“AB facilities with an organised infrastructure allow the technician easy access to the cows and reduce tech and cow stress."

LIC is aiming to increase awareness about the importance of AB facilities and offer farm-

ers simple ways to improve them.

“By improving on-farm facilities we will ensure a safe working environment for our staff and give our AB technicians the best opportunity to get cows in-calf,” he said.

Even the smallest change can make a big difference.

Mr Hale said one farmer installed a backing bar in his herringbone shed so the cows could be

held more safely and securely for insemination.

“As soon as the backing bar was in you could see the cows were more secure, and that made the AB tech more comfortable so it must help with the mating result,” Northland farmer, Murray Jagger, said.

"It was a small but important change, and if it helps them get my cows in-calf the first time, it’s well worth it.”

Three-step check on AB facilities 1. The cows need to be walking in and rowing up happily without any significant human input.

2. The AB technician needs a large, solid, non-slip platform at the same height or slightly higher than the cow (it should never be lower than the cow) so he can concentrate on getting the cow in-calf without distraction.

3. The farmer: ask your AB tech if there is anything you should or could do to improve the farm's AB facilities and the way the cows are presented to help the tech do the job.

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DAIRY NEWS AUSTRALIA MAY 2018

26 // ABVS – APRIL 2018

Jeronimo first to break 400 BPI profit barrier HOLSTEIN NEWCOMER ABS JERONIMOP-ET is the first bull to break through the 400 BPI$ barrier.

JERONIMO-P was first identified in the Australian Breeding Values (ABV) future stars list in December (BPI397). In the April release he recorded a BPI$ of 402.

In 2013, as ABS was investing in elite Holstein female genetics, RICHMOND-FD TANGO JULY-ET was purchased based on her genetic profile and cow family.

She descends from the COYNE-FARMS RAMOS JELLY family in New York, a cow family known for healthy, fertile cows with moderate frame size and high components.

The decision was made to flush JULY to a polled bull, which resulted in her highest ranking heifer also carrying the polled gene.

This heifer, ABS 7726 JAZLYN-P-ET, was flushed extensively in an attempt to further improve the genetics of this family, while maintaining the traits for which it is best known.

The bull that combines the best characteristics of this breeding program is ABS JERONIMO-P. The high components, fertility and great health traits that the family transmits have been intensified in this sire. The fact that he is also heterozygous polled and carries the A2 gene further adds to the excitement around his genetic profile, according to ABS “The genomic plan ABS Australia invested heavily in has continued to deliver exciting

options for Australian dairy farmers, “ said ABS National Sales Manager, Paul Quinlan.

“Breeding more profitable cows is our primary focus for Australian dairying and testing sires on the Australian ABV system is important to us.

“We see too many variations in overseas sires for us to work just with their country of origin data. We want them to genetically perform in Australia.”

Through its comprehensive global breeding

including Jeronimo-P, are all A2/A2.

Mr Quinlan said SUNSET CANYON DAZZLER and CAIRNBRAE JACES ELTON lead the Australian proven Jersey team.

“Dazzler excels in lowering cell count and, as the #1 bull in Australia, he transmits excellent daughter and semen fertility.

“Elton has added more daughters to his already impressive number, now recording more than 5,500 daughters herd testing.”

program, ABS has proved there is a gene-environment correction on all sires.

“It doesn’t mean sires that don’t convert high aren’t suitable, but it’s a very reliable guide on their transmittable profitability for the breeders and farmers in Australia.”

Mr Quinlan said ABS has the top three proven Holstein sires in DE-SU 11¡228 TOPSY (353 BPI), DE-SU 11¡236 BALISTO (344 BPI) and SEAGULL-BAY MVP (322 BPI).

ABS’s top proven sires and genomic sires,

FOSKE RETAINS POLL POSITION IN REDS V Foske regains his position at the top of the Reds with a BPI of 284. He now has 1288 Australian daughters in his proof.

Viking Genetics said V Foske has been heavily utilised by red breed enthusiasts and the cross breeding sector of the industry.

“He has been such a consistent sire for having high production and providing the boost in fertility and longevity that so many farmers are looking for,” Viking Genetics business manager Anna Norgren said.

The Viking Genetics Holstein sire, VH Booth, has retained his position at

number two in the BPI proven sire list with a BPI of 349.

“VH Booth has a very reliable international proof with 4341 daughters and provides the type of cows most farmers are looking for with medium size frames, nice udders, strong feet and legs coupled with great production, health and longevity,” Ms Norgren said.

“Viking has been very happy with the performance of our Holstein sires here in Australia.

“We have had 12 Sires achieve Australian proofs since we opened for business here 9 years ago with an

V Foske regains his position at the top of the Reds with a BPI of 284.

average BPI currently of 201 which shows a great adaption to the Australian conditions.”

Viking Champions BPI April 2018

Ensure your herd’sEnsure fertility your

Viking Champions

Daughter average production (4,341 daughters)

Daughter average production (13,469 daughters)

• • •

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Milk 305 days 10,962 kg 4.02% Fat 3.41% Protein

Milk 305 days 9,266 kg 4.40% Fat 3.53% Protein

BPI April 2018

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Daughter average production (4,341 daughters) Daughter average production (1 Daughter average production • Milk 305 days 10,962 kg daughters) • Milk 305 days 9,266 kg (13,469 • 4.02% Fat • 4.40% Fat • Milk 305 days 9,266kg VH Booth V Föske • 3.41% Protein • 3.53% Protein The future of your herd begins Holstein VikingRed • 4.40% Fat BPI April 2018 The future of your herdcows. begins with the fertility of your cows. with the fertility of your Superior longevity Superior longevity With service WithFertility FertilityFirst Firstadvice advice service you can achieve $134 extra • 3.53% Protein

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DAIRY NEWS AUSTRALIA MAY 2018

ABVS – APRIL 2018 // 27

Maebull leads the way for GA

Strong showing from Genomax sires SEMEX’S NEW release BPI Genomax sires

average close to +300 BPI, combining high components, impressive health and fertility traits along with solid overall type and mammary systems.

Semex Product and Operations Manager, Tyson Shea, said Semex has over 20 Proven and 50 Genomax sires listed in the April Good Bulls Guide.

“0200HO sires rise to the top. We’re excited to offer these sires and believe in their profit potential.” Mr Shea said.

Semex’s new release BPI Genomax sires include: ■ Sandy-Valley-I Paramount (Joyride X Numero Uno) a Calving Ease & GrazingPro sire featuring +305 BPI, +0.21 per cent Protein, +0.47 per cent Fat and +116 Daughter Fertility.

■ Progenesis Cosmic (Boastful X Mardi Gras), an A2A2 and HealthSmart sire, at +299 BPI, +546L, +0.13 per cent Protein and +115 Daughter Fertility.

■ Progenesis Fergus (Silver X Halogen) is a HealthSmart, RobotReady and GrazingPro sire combing +296 BPI, +0.18 per cent Protein, +0.24 per cent Fat with strong scores of Survival +111, Daughter Fertility +109 and +158 Cell Count.

entino leads the way. “Not only is he the highest BPI sire, but one of the breed’s best type sires giving him the unique ability to straddle the high ABV and show ring worlds.”

“Local stalwart, TAHBILK, continues to impress with a 230 BPI and with outstanding fat and protein percentages, he continues to be one of the breeds most popular sires.”

Shelley said Genetics Australia has an outstanding group of young Australian genomic sires that will be available this spring, including three sires above 330 BPI. “These sires will be on line for spring joinings and will be used in our IVF breeding program as soon as they produce semen”, Mr Shelly said.

“We are also excited to have an extremely high genomic sire from Germany who will be available in the coming months.”

Wil Hotspot P is the number two genomic sire in Germany and will hold the same position on the Australian list once released. He will be available in limited quantities in the coming months due to his global demand.

Jersey sires DOBSON (297 BPI) and DOUGGAN (289 BPI) have the balance of traits today’s Jersey breeders are looking for, Mr Shelley said.

THE APRIL 2018 ABV run has seen a consolidation of Genetics Australia’s elite daughter proven sires. Holstein sire MAEBULL leads the way at 309 BPI. This sire has over 100 daughters in his production proof and boasts a daughter fertility ABV of 112. He is also one of the best high BPI sires for the new Heat Tolerance trait.

Joining MAEBULL in the Holstein proven team are brothers GEEMCEE and WRANGLER. Both sires sit within the top 10 daughter proven sires with GEEMCEE being one of the better production sires available today, according to GA CEO Anthony Shelley.

Wrangler’s first sons are appearing in this year’s Horizon genomic program.

Christmas and Royalman continue to be reliable choices with 1148 and 702 daughters respectively in their production proofs, Mr Shelley said.

“Christmas is still the number one frame builder in the country and these bulls are hard to find.”

“Royalman is a modern bull in many ways with 110 for daughter fertility and an impressive 103 for calving ease making him one of the best going around for heifer programs.”

In the Jersey breed, imported sire 7J1038–Val-

Pen-Col Beattles (Silver x Supersire) a HealthSmart™, Calving Ease, RobotReady and GrazingPro sire featuring +292 BPI, +31¡kg Fat, +0.41 per cent Fat, +0.26 per cent Protein along with +110 Daughter Fertility and +151 Cell Count.

Mr Shea said ranking high on the BPI proven listing is HealthSmart, Calving Ease, A2A2 and GrazingPro sire Leothe Dark Vador.

“Debuting at #10 at +314 BPI with high component deviations, Fat per cent +0.45 and Protein per cent +0.37, Dark Vador provides an outcross sire stack (Enforcer X Sudan X Baxter).”

“Strong ratings for health and fertility traits at +110 Daughter Fertility, +160 Cell Count and +107 Survival, combined with solid type and mammary system scores, expect Dark Vador to sire medium size, black, trouble free cows.”

Regancrest Brigham is the equal #1 Daughter Fertility sire in April at +119. This Numero Uno son from the famous Regancrest Barbies, combines an impressive TPI proof with a high ranking ABV. For additional information on Semex, Genomax, Genetics for Life or any of Semex’s brands visit: www.semex.com.au ■

Productive Life measures the ability of a cow to resist culling for any reason.

Productive Life (PL) only gives credit for the first 10 months of each lactation (305 days) hence rewarding cows who calve regularly and spend more time in peak production. The average PL is 29 months (approx. 3 lacts). A PL of 1.0 means the daughters of the bull average one additional month of productive life compared to breed average. PL is highly correlated to DPR (+0.64) and SCS (-0.45).

Somatic Cell Score (SCS) measures a bull’s milking daughter’s somatic cell count. The USA average is 3.00, with lower values indicating lower SCC, therefor a lower score is desirable.

Genetically, do all cows have the ability to last in today’s herds and not get mastitis and other diseases?

Long lasting trouble free cows make more money!

The example below from an 800 cow genomically tested herd shows the actual performance of cows when divided into quartiles based on genomic PL & SCS.

No farmer today can afford free loaders.

Group

PL Ave.

Fresh

Abort

DNB

Sold

Died

Mastitis

Group

SCS

Count

SCC

Mastitis

High PL

6.8

116

5

2

0

0

7

Lowest SCS

2.72

219

128

24

Low PL

2.5

164

44

53

144

13

74

Highest SCS

2.96

205

217

53

Talk to your WWS Representative about ways to improve the health and longevity of your herd.

CODE

NAME

507HO12993

HUMBLENKIND

+8.20

7HO13551

AMAZING

+7.30

507HO13598

PINNACLE

+7.20

Had 90% fewer cases of clinical mastitis.

507HO13907

JARED

+7.20

Had fewer abortions and only two cows were identified as DNB (Do Not Breed).

14HO07878

FASTBREAK

+7.20

All cows completed their lactation, compared to only 7 of 164 cows in the low PL group.

7HO11395

MYSTIC

+7.10

The best cows in this herd averaged 6.8 PL and 2.72 SCS. Cows in the 6.8 PL group:

04-18 CDCB-Genomic data

Cows in the 2.72 SCS group: Had a SCC of 89 points lower than the high SCS group.

Had 55% fewer clinical mastitis cases than the high SCS group.

Pinnacle MGD: S-S-I Suprsire Miri 8679-ET, VG 89

Amazing Dam: S-S-I Mont 8679 10726-ET, GP 83

Humblenkind Dam : Cookiecutter Epic HazelET, EX 91

PO Box 7538 • Shepparton • 3632 Victoria Phone (03) 5831 5559 • Fax (03) 5822 0005 info@wwsaustralia.com • www.wwsires.com

PL

DAIRY NEWS AUSTRALIA MAY 2018

28 // MANAGEMENT

Giant barn centrepiece of German farm STEPHEN COOKE

A 1000-HEAD barn and automated milking system is the centrepiece of an impressive family operation in east Germany.

The Lansink family¡—¡Gerhard and Ivana and their son, Guus¡—¡built their 1000-head barn on their Wartenburg farm, south west of Berlin, in 2014. Unfortunately, a dramatic drop in milk prices followed, as Germany banned dairy sales to Russia following their involvement in shooting down a passenger plane.

The Lansinks run three branches¡—¡the dairy, a farming operation and biogas production¡—¡in a bid to spread their risks.

“In the dairy sector, we hope that the cash crop will help us out. Two years ago, both milk prices and crop prices were bad,” Guus said.

The family has 25 full-time employees on the farm.

Recent changes to biogas production means it is not as attractive for farmers or other businesses to invest, but they have a contract until 2032 with their current system.

They also receive Government subsidies for their cropping land.

The Lansink family moved to east Germany from Ontario, Canada in 2006, starting with 300 milking cows on 1500 hectares¡—¡1000¡ha of tillable land and 500¡ha of grassland, comprising good loamy soil.

They farm 215¡ha of winter wheat, 170¡ha of canola, 165¡ha of winter barley, 350¡ha of corn, 60¡ha of alfalfa and 40¡ha of sugar beets.

Of the 500¡ha of grassland, 60¡ha comprises conservation area, where they’re not allowed to put much manure on and can only start mowing June 15 to enable birds to breed, and 40¡ha of grasslands around small local towns.

They now run 950 milking cows, 150 dry cows and 900 young stock on three different locations.

The herd averages between 36 to 36 ½ litres a day with 3.9 fat and 3.4 protein.

Heifers are kept about 3¡km from the new barn, and are run on grassland in summer until about October, depending on weather, before being housed in a barn.

Construction of the new barn began on a greenfield site in June 2013 and involved 29 different companies. The 150¡m by 72¡m structure took more than 35¡000 hours, and involved moving 15¡000 cubic metres of soil.

2500t of construction waste from sow barns made superfluous from the communist era was processed and used, as was 4260 cubic metres of concrete and 220t of reinforced steel. 480t of steel was used in total and 5¡km of wood beams.

The barn contains 16 A4 Lely robots and also utilises the Lely Juno feed pusher.

Solar panels on the roof make roughly 1.2 megawatt of energy a day and the roof was rented to a company for 20 years. The upfront payment paid for the roof. The office area and break rooms are also heated with warmth of the milk, which offsets energy costs.

Daily slurry production is 70 cubic metres and under the barn there is storage capacity for 20¡000 cubic metres of slurry. This is used to produce biogas. They produce 360 ¡kW daily, with 60 per cent from animal waste products (15t slurry/5t manure per day) and 40 per cent feed products (silage) (5t corn/5t gas).

“We sometimes employ a custom guy to shred manure straw, which enables us to get more energy with less product,” Guus said.

“From the silos, we take away silage from both sides and the top. Just in case there is any mould in feed, it usually occurs on side or top, so we use it for biogas.

“We were planning to build another biogas converter on this location, but EU changed laws and subsidies so not as attractive.”

They are currently renovating a shed to make a new calf shed, where calves will be housed from day 1 to 20 weeks. They currently use igloos and although Guus says it is a good system, 100–150 calves to feed means it is a lot of extra work. “Having calves in one barn in one location, will make it much more efficient.”

They will also invest in a new slurry system.

“Right now we are hauling everything. Next year we will be able to pump manure from barn into fields with a drag hose. Our fields are in a radius of 5–6¡km so the drag hose system will be good. With slurry tanks we can spread 40 cubic metres an hour, with drag hose it will be 250 an hour, so it will save a lot of time.”

Cows weigh between 650–700¡kg.

Milk price is currently 30–31 Euro cents per kilogram of liquid milk. Guus said this was “pretty good, not the greatest”. Their production cost is about 29–30 euro cents per kilogram of milk.

“When we started we were paid 27c. In Nov 2014, we were at 27c, then it went down to 20c.

We had two really rough years after building the barn.

“Then it went up to 40c, we all knew it wouldn’t stay there. Then in one month it dropped 9c from one month to the next.”

There are no milk quotas in place but tillable land is 300 euros per hectare, with grassland attracting 90 euros per hectare.

To receive this farmers must meet Government requirements. The Lansinks met the Government criteria of growing a green crop on 6 per cent of tillable land by planting alfalfa, which Guus said is great feed for dairy cows.

“If you build a new barn you can get

One of 16 Lely A4 milking robots inside the barn.

Gerhard Lansink in his 1000-head barn in Germany.

Guus Lansink outside the barn with a red cow presented by Lely. The barn contains 16 Lely A4 milking robots.

subsidies, but this province only subsidises up to 500 cows. They say bigger farms can sustain themselves. If we were 40¡km down the road we would have been eligible.” Subsidies for barns are 40 per cent.

The biogas is profitable, as it earns money from the energy company and subsidies from the Govenrment, amounting to 90 euros per tonne. They animal waste is mixed with a selfpropelled feeder, makes methane, which is burnt off and generated into electricity, which he is paid for. That waste is then used to fertilise grassland.

It has a higher concentrate of nitrogen than dairy slurry and has proven more effective.

“The way the dairy market is, it would have been more profitable to invest the money we spent on the barn in a new biogas generator,” he said.

Farmers must provide their processors with two years notice if they want to leave, and Guus says they can be told their price two weeks into a month, or at the start of the month.

There is a bonus for additional fat and protein but litres is the main profit drivers. Once you produce a benchmark for fat and protein, the additional cost required to raise this is not

necessarily rewarded.

“Effectively, the more I produce, the more I’m paid. A few months ago we averaged 38¡litres per day and that was a bit too much. We always need to look at what can be produced but also is it going to work out for cows. We’re happy between 36 to 36 ½ litres a day.”

They produce between 33¡000–34,000¡litres each day (3.9 per cent fat and 3.4 per cent protein).

However, the real bonus is supplying nonGMO milk.

“It’s a huge thing in Germany at the moment, they are going crazy for non GMO.” It wasn’t had to make the switch as GMO products are banned in the EU. They had to switch their soya bean supply from the US to Hungary.

“We just feed that and show the government we’re not using non-GMO products from companies that don’t use GMO products in those trailers.

“They’re pretty much forcing us to do so.

DMK said produce non-GMO or we’re not taking your milk.”

• Lely funded Stephen Cooke’s trip to Germany and the Netherlands.

The 150m by 72m structure took more than 35,000 hours to construct.

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DAIRY NEWS AUSTRALIA MAY 2018

30 // MANAGEMENT

East German farms unite to form co-op SUDESH KISSUN

THE

AGRARGENOSSENSCHAFT

Gnaschwitz (Agri Co-op), in the town of Gnaschwitz, east Germany, milks 460 cows year round with eight Lely robotic machines.

The co-op is owned by about 100 shareholders, each owning a small parcel of the farm.

Following the reunification of Germany in 1990, land seized by the former communist regime in East Germany was returned to people if they could show evidence of their family’s ownership.

However, members of Agrargenossenschaft Gnaschwitz found little use for the small parcels of land they received so they decided to form a co-op and start a dairy farm.

The co-op holds an annual shareholder meeting and profits are paid out as dividends.

Day-to-day operation of the farm is overseen by a board of directors.

Shareholder, board member and farm manager, Lisa Russig, hosted visiting journalists at the farm in April.

She says maximising milk production and

increasing shareholder returns are the main objectives of the dairy business.

Cows are housed in a barn 193¡m long and 38¡m wide. All feed¡—¡grass silage, maize silage, lucerne and rapeseed meal¡—¡is grown onfarm.

Ms Russig says when the old barn needed replacing six years ago the co-op board visited other dairy farms in Denmark, Netherlands and Germany to explore options. The co-op was at a crossroad¡—¡whether to continue milking in a refurbished old barn or build something new.

“We opted for robotics because it’s very difficult to get farm staff in this region; just to reduce labour pressure we opted for robotics,” she said.

The new barn can house 590 cows, but now milks 460 cows daily; the others are either dried off or calving.

The milking cows are in four groups, each group milked on average 2.5 times a day by Lely A4 robots.

Each cow produces about 36L. The milk is sold to German processor Muller for 29 euro cents/L plus an extra 1.5 euro cents/L bonus for milk quality.

European dairy processors have been hit

Lissa Russig is a shareholder, board member and manager of the farm.

The Agrargenossenschaft Gnaschwitz (Agri Co-op) is owned by about 100 shareholders, each owning a small parcel of the farm.

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DAIRY NEWS AUSTRALIA MAY 2018

MANAGEMENT // 31

This Lely MiniStro circles the shed and drops 6-7kg of sand in each bed daily. Cows still in their stalls get covered in sand.

hard by Russia’s ban on dairy imports. Russig expects the milk price to fall further in the coming months.

Calving is done year round. Cows are dried off six to eight weeks before calving; two to three weeks before calving they are taken to one end of the barn which has straw bedding.

Cows are calved in groups and hand-milked by bucket milkers for the first few days.

Calves are taken to the old milking shed now used to house young stock. Cows are eased back into the milking herds.

Russig says milk from the Lely robots can either go into the main storage tank for col-

Members of the co-op and the public can buy raw milk in this office on the farm. Pastuerised milk is available in other areas of town.

The barn was built for 592 cows with a current milking herd of 460.

lection by Muller or a smaller tank for feeding calves. Milk not suitable for collection is dumped on the farm.

Effluent is scraped and then injected into paddocks using a tractor and slurry tanker.

The barn also has a Lely Juno automatic feed pusher doing 19 trips around the barn daily, pushing feed closer to cows Cows are fed twice a day, barn feed accounting for 26L/cow/day. Feed concentrate given to cows in robotic machines provides an extra 4–5L of milk per cow daily.

• Lely funded Sudesh Kissun’s trip to Germany and the Netherlands.

Lisa Russig, farmer Lisa Russig graduated in agrieconomics and management at the University of Dresden.

The study included three 6-month attachments on the farm, which employs eight fulltime staff and four students.

The co-op also owns a grains business and sells raw milk on

the farm and pasteurised milk in the city.

Under German employment laws, employers must provide daily hot meals to workers. The co-op runs restaurants serving 250 meals daily to workers in the region.

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DAIRY NEWS AUSTRALIA MAY 2018

32 // ANIMAL HEALTH

Milk additives: Do you know what you’re feeding?

OVER THE past decade, the availability and popularity of milk additives has increased with many dairy farmers.

In Australia and New Zealand such additives are frequently added as a powder to whole,

unpasteurised milk, prior to feeding to replacement calves.

This article discusses the common ingredients in milk additives and their potential value to improving calf health.

What do milk additives contain?

There is a plethora of commercially available milk additives, all containing variations of similar groups of ingredients.

The most common groups include vitamins,

APIAM ANIMAL HEALTH GEMMA CHUCK

minerals, prebiotics, probiotics, ionophores and antibiotics.

Other ingredients include enzymes, yeasts and antioxidants.

The role of each of these ingredients can become confusing but farmers and calf rearers should be fully aware of what they are feeding their calves and the reasoning behind it.

Vitamins The most common vitamins that are included in milk additives are Vitamin A, D, E, C and B-group vitamins. In any healthy animal, these vitamins aid in metabolism and maintenance of various tissues and organs.

Minerals Minerals nearly always feature in milk additives and commonly include zinc, manganese and iron and the trace elements copper, cobalt and selenium.

They have a diverse range of functions in the body and are generally required for metabolism and maintenance of organs.

I reckon if they could talk, they’d ask for it by name.

Prebiotics

If we could talk we’d be on TV.

And asking for Champagne with breakfast.

Prebiotics are non-digestible food ingredients that, when consumed in sufficient amounts, can enhance the growth and/or activity of orally administered probiotics and/or existing beneficial gut bacteria.

The most commonly used prebiotics are carbohydrates, such as oligosaccharides or dietary fiber with low digestibility.

It has been suggested that several types of oligosaccharides have specific functions in calves, including blocking the colonization of harmful bacteria in the gut.

Supplementation with prebiotics may improve the growth performance of calves in either the pre- or post-weaning stage.

Similar to the case of probiotics, the observable benefits of prebiotics are likely to be minimal when calves are generally healthy.

Research to date has shown mixed results on whether prebiotics have any apparent benefit on body weight gain, feed efficiency or health measures. Further research is required to provide definitive evidence.

Probiotics The Food and Agriculture Organization and World Health Organization has defined probiotics as “live micro-organisms which, when administered in adequate amounts, confer a health benefit on the host.”

The most common micro-organisms used in probiotics for calves are Lactobacillus and Bifidobacterium bacteria.

These probiotics have the potential to enhance gut health by stimulating the development of healthy gut bacteria, preventing harmful bacteria from colonizing the gut, increasing digestion and improving gut immunity.

Research measuring the effects of probiotics added to diets of young calves has been equivocal. In some studies, improvements in animal performance have been reported; in others, no effect of the inclusion of probiotics has been found.

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Continued page 33 >

DAIRY NEWS AUSTRALIA MAY 2018

ANIMAL HEALTH // 33

No mud but something has changed

The positive effect of probiotics has been observed in less healthy calves, reared in challenging environments. In stressed conditions, probiotics may help reduce the risk or severity of scours.

However, a better understanding of how the different probiotics work in relation to other gut bacteria and immune system is required.

Probiotics can be misused on the farm leading to a poor or non-existent response. It is worth remembering that probiotics are living bacteria and they must be handled carefully to maintain viability.

Always check the expiration date and store according to the manufacturer’s instructions.

Possibly the most important point is that adding probiotics to antibiotic milk will defeat the purpose of including the probiotic in the first place!

Ionophores

Antibiotics On some farms, prophylactic antibiotics have

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The two registered ionophores for use in cattle are lasalocid (Bovatec®, Zoetis) and monensin (Rumensin®, Elanco).

At therapeutic levels, they aid in the control of coccidiosis in young calves and can help improve feed conversion efficiency.

Either ionophore can be included in a milk additive but be aware that they are also commonly included in calf milk replacers and commercial calf concentrates.

Both can cause toxicity if ingested above the safety threshold. It is important to check the ingredients of any calf milk replacer, milk additive (powdered or soluble) and calf concentrate for the inclusion of ionophores.

been used to maintain the performance of calves and reduce the risk of scours.

However, the use of mass in-feed antibiotics is not considered good antimicrobial stewardship as there is increasing global evidence of antibiotic resistance in both humans and animals.

Antibiotics should only be used when they are needed to treat existing bacterial infections.

Appropriate storage, dosage, route of administration, observation of withholding periods and records should be kept for all treatments.

The use of prophylactic antibiotics in every calf is not sustainable in the long-term and is strongly discouraged.

Commercial milk additives are generally not medicated with antibiotics but custom-made additives do exist and it is essential that you check the label, know what you are feeding and why.

In summary, there are a large number of commercial milk additives available, often with a multitude of claims and testimonials.

It is recommended to consult with your veterinarian before using a milk additive to help identify specific active ingredients, concentrations, modes of action and data supporting the claims. Ingredient interactions with other dietary components should also be considered.

• Gemma Chuck is an adviser with Apiam Animal Health.

References: “Effects of Probiotics/Prebiotics in Cattle Health and Productivity”, Uyeno, Y., Shigemori, S., Shimosato, T. (Microbes and Environments, 2015) “Probiotics in Calf Feeding Programs”, Quigley, J. (Calf Note #91, 2003)

E

Barham 03 5453 3159 Cohuna 03 5456 2709 Leitchville 03 5456 7334 Kerang 03 5452 2094

UT

Kyabram 03 5852 2244 Nathalia 03 5866 2860

Smithton 03 6452 1054

HERN

R I N A V

Finley - 03 5883 3833 Tocumwal - 03 5883 3833 Echuca - 03 5482 3202 Moama - 03 5480 6071 Deniliquin - 03 5881 5488

Warrnambool 03 5561 2255 Port Fairy 03 5568 1855 Koroit 03 5565 8407 Nullawarre 03 5566 5122

API0435 08 2017

< Continued from page 32

• Rod Dyson is a veterinary surgeon and mastitis adviser at www.dairyfocus.com.au

T S

figure it out¡—¡it’s not wet, and there is no mud.”

This was Jeff ’s first comment when I returned his phone call couple of months ago.

Jeff* and his wife Karen* milk 650 cows through a 60 stand rotary dairy in northern Victoria.

They had done a lot of work to get their mastitis to where they were now reasonably comfortable¡—¡Bulk Milk Cell Count (BMCC) sat between 100¡000 and 110,000, and clinical case rates of mastitis were well below the Countdown trigger point of 2 cases per 100 milking cows per month.

It had taken quite some effort for them to get there. In fact, to get the excellent teat end condition that the herd was now enjoying the benefits of, had taken a change of cluster and liners, but the results had been outstanding.

Teat ends now regularly scored at 10¡—¡12 per cent rough teat ends, well down from the over 30 per cent rough teat ends that were present beforehand, and below the trigger threshold of 20 per cent.

But the last few months had seen the BMCC rising steadily, and also an increasing number of clinical cases of mastitis, and Jeff was now frustrated, in fact, very frustrated!

But there was a key message in those first few words on the phone to me¡—¡“Something

Over the next month the BMCC dropped by 100¡000 cells/ml, and the clinical case rate returned to below the Countdown trigger point.

This case highlights some really important points.

Firstly, if you think something might have changed, investigate it.

Secondly, all farms should regularly assess and review milking routines to ensure as close as possible to best practice.

Finally, Jeff and Karen’s dairy is a low-line configuration, and these systems are often very sensitive to vacuum levels, because little vacuum is “lost” or “used” to lift milk as happens in both high and mid line systems¡—¡it is almost like there is a direct connection to the milkline, with little interference from milk.

We regularly find that subtle changes in vacuum, sometimes as little as 0.5¡—¡1.0 kPa can make a significant difference¡—¡and this effect is even more significant where light weight clusters are being used.

If you think something has changed, there really is no substitute for milking time measures and assessments! * Names have been changed for this story.

Coupled with these cow risk factors, teat spray coverage was not great, and often there was a long delay between cup removal by the automatic cup removers and the manual application of the teat disinfectant.

We could immediately address the teat disinfection issues with some staff training and a small change to the milking routine, but what was causing the changes to teat condition and milk-out?

The changes we saw are consistent with the vacuum level being higher than optimal for the herd and the system, and sure enough the milking time claw vacuums that we recorded were right at the top end of the desired range.

Perhaps more significantly, we were able to check back on our previous records for the farm, and these claw vacuums were now 0.5¡—¡1.0 kPa above our previously recorded levels.

A full milking machine test was then organised, and although the plant passed all tests, the vacuum level was lowered by 1.5 kPa. Teats and teat ends will heal remarkably quickly when the stress that causes damage is removed, and at a re-check four weeks later, teat condition in this herd had returned to the previous level with only 10 per cent rough teat ends, and the clinical case rate had also started to drop.

E

“SOMETHING HAS changed. I just can’t

has changed.”

Whenever there is a suggestion that something has changed, one of the first actions generally needed is to get some milk cultures.

Whilst initially Jeff was a bit reluctant, “They always come back as Strep uberis”, he sent off a batch of 6 milk samples from fresh clinical cases a few days later.

When the results came back, there were five useful cultures and one reported as “No Growth”.

Of the five useful samples, three were Staph aureus, and two were Strep uberis.

Jeff and Karen had sent off many batches of milk samples over the last couple of years, and up to this point, Staph aureus had been a very rare result, so this was suggesting that something may have indeed changed!

The number of samples was still too low to be sure, so Jeff and Karen continued to collect more samples for a little while to be able to confirm the diagnosis.

Staph aureus is a cow-associated mastitis pathogen, meaning that all spread of infection of this bacteria occurs during the milking process¡—¡so now I was really interested in the dairy!

We immediately organised a milking time visit and this was a revelation.

Teat end condition had seriously deteriorated back to 30 per cent rough teat ends, and a very high proportion of cows were failing to milk out properly.

S

ROD DYSON

DAIRY NEWS AUSTRALIA MAY 2018

34 // MACHINERY & PRODUCTS

Farmer front of mind DIRK AND Els Keijzer and their son, Hans,

noticed an immediate improvement in terms of cow comfort and usability with the Lely A5 Astronaut compared to the A4.

The Keijzers milk 120 dairy cows and run an extra 60 young stock in a barn on their 70¡ha farm outside Rotterdam in the Netherlands, producing about 10¡000¡litres per cow annually, or between 33–34¡litres a day.

“It is a more silent machine and the manoeuvring underneath the cow is more agile, smoother and quicker,” Mr Keijzer said.

Mr Keijzer said the user and cow had to get used to the arm moving more quickly but it did not take long to settle. The new A5 also located the teat almost immediately.

The Keijzer farm is one of the first commercial farms to use the new A5. It installed A4 robots when the barn was completed in 2016 and is designed to be operated by one person.

The automated arm is silent and more efficient.

They currently perform 3.3 milkings per cow per day with between 7–8 refusals. The cows have freedom to move, which removes pressure at milking time.

Lely said a design priority was to shorten the learning curve for the farmer. The interface now has the look and feel of its app, InHerd.

“We asked how is the farmer using it?” a technician on farm told visiting journalists.

“We visited all farms during the testing and validation process, witnessing the first time farmers used it and from that we could see what steps we did not get right and improved that.

“We implemented small changes and that brought us to an end score of 9.1 out of 10 (for usability), whereas the old system we scored 6.2.”

A list of maintenance tasks is scheduled and once completed the task is automatically removed from the list.

Dirk and Hans Keijzer have installed three A5 robots on their Netherlands farm.

As an example of improved usability, the user had to press the interface eight times to get the arm in the correct position for cleaning. Now, the user has to press one button.

“We’ve improved the cow comfort factor with the A5 but we also had the farmer front of mind, too.”

The interface is more user friendly.

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DAIRY NEWS AUSTRALIA MAY 2018

MACHINERY & PRODUCTS // 35

Lely launches its latest Astronaut STEPHEN COOKE

THE LATEST version of the Lely Astronaut

milking robot was launched at the company’s home base in the Netherlands last month and is now available to order in Australia.

The Lely Astronaut A5 was revealed in front of 750 people at the Lely Future Farm Days event near Rotterdam.

The A5 has been tested for over 18 months on 30 farms in seven countries. More than 2¡million milkings occurred.

The company also launched the latest version of its Juno feed pusher. It has sold 8000 of these machines worldwide.

Lely has sold 30¡000 of its Astronaut robots worldwide. Company CEO Alexander van der Lely said the newest version uses 20 per cent less power, is 30 per cent more efficient and increases cow comfort.

“With the A5, cow comfort has been further improved with a new hybrid arm: silent, faster, energy efficient and more accurate, it results in consistent milking,” Mr van der Lely said.

“Instantly following the cow’s every movement during milking, and remaining close to the udder, it quickly corrects itself in the case of any unexpected movement.

“This ensures a fast and thorough milking

process, even with heifers.”

With the new Teat Detection System (TDS), Lely said post-milking teat spraying has been improved by pre-scanning the udder before spraying, ensuring optimal udder hygiene and limiting the risk of contamination.

Lely has also redesigned the interface, which has been reviewed favourably during testing.

“The redesigned, intuitive user interface makes automatic milking easy to understand,” Mr van der Lely said.

“From a cow’s first milking to everyday maintenance, all relevant information is available on one single page. Instant actions, such as feed allocation, cow-specific routing and daily maintenance tasks are just one click away.”

Mr van der Lely said Lely has redesigned the complete system to achieve a significantly lower total cost per kg of milk produced.

“An extensive worldwide test program, with over 30 customers and more than 2¡million milkings, across a wide temperature range was set up.

“In all tests, detergent and water consumption were lowered and energy use was reduced by up to 20 per cent.”

The new A5 is compatible with the A4.

• Lely funded Stephen Cooke’s trip to Germany and the Netherlands.

The A5 has been tested for over 18 months on 30 farms in seven countries. More than 2 million milkings occurred.

Local thumbs up for A5 AUSTRALIAN DAIRY technicians and Lely

distributors, Rob Ciavatta, Mount Gambier, and Damian Loomans, Warrnambool, attended the Astronaut A5 launch at Lely’s HQ in the Netherlands.

Both men were given a thorough overview of the new machine and were impressed with the improvement on its predecessor.

Mr Ciavatta will install the first A5 robots in Australia this month, with six purchased by the Clark family, Mil-Lel, SA. “The A5 is a complete step ahead of the A4,”

Mr Ciavatta said.

“Energy consumption has been reduced dramatically, and ease of maintenance has been improved for both technician and farmer, which will reduce time a technician requires on farm for servicing.

“It is also much quieter. You would think they’re not running if you didn’t know.”

The A5 also uses significantly less compressed air than its predecessor, which will reduce cost.

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DAIRY NEWS AUSTRALIA MAY 2018

MACHINERY & PRODUCTS // 37

Room with a great view MARK DANIELS

THE DICTIONARY defines ‘panoramic’ as “an unbroken view of the surrounding region”, so the new Claas Arion 400 series tractors should be worth a closer look.

The six-model series has machines from 90 to 140¡hp.

Built at the company’s Le Mans plant in France, the new 400s are powered by four-cylinder, 4.5L Fiat Power Train (FPT) engines with no need for exhaust gas recirculation for emission control.

A huge improvement to the layout of the cooling package, and forward mounting, allow easy access to all the machines’ radiators and air cleaners.

The Quadrashift semi-powershift transmission has four ranges and four powershift steps to deliver 16 forward and 16 reverse speeds, and it has the Quadactiv function that allows fully automatic shifting of all speeds, alongside field and transport modes. To complement this set-up, the Revershift function enables clutch-less forward or reverse shifts via a column-mounted shuttle lever or multi-function controller.

Also useful is the SmartStop function which at speeds less than 9¡km/h brings the tractor to a stop by pressing the brake pedal, which in turn cuts the drive. Lifting the foot off the brake reinstates drive and the tractor moves off.

At rear, a GIMA axle has a lift capacity of 5750¡kg with the aid of twin lift rams, and offers 540, 540E and 1000 PTO speeds. Diff lock function sees 100 per cent locking to the rear and LSD to the front axle with automation via speed or linkage position.

The hydraulics have a tandem open-centre set-up with one pump delivering 60L/min to the hydraulic valves and the other 40L/min to the rear linkage. Locking both pumps together creates a combined flow of 100L/min for high-speed loader operations. Three rear remotes are fitted as standard, alongside two mid mount valves dedicated for loader use and controlled by the ElectroPilot system.

The jewel in the crown, the Panoramic cab, allows unrivalled forward and upward views that make the tractor ideal for loader operations. The view through the arc of the MX-sourced FL120 loader is unsurpassed, and although large areas of glass and laminate are used, the 6-post structure still meets all ROPS and FOPS safety regulations.

When not being used for loader duties, a clever sliding roof screen can be moved into place, and a folding sunscreen. The cab has rear mounted 2-point suspension working in combination with a solid front axle.

A load bearing sump assembly removes the need for chassis rails, and the resulting ‘wasp waist’ allows tighter turns, making loader fitment easier with the use of cast towers.

In the cab, the obligatory air suspension seat works with the tilt and telescope steering column to make the operator comfortable, and a multi-

function lever to the right takes care of all key functions including powershifts, range changes, loader operation, engine memories and rear linkage. A CIS display at the front A-pillar gives a clear view of essential tractor information.

Looking at the complete package, the New Arion 400 series raises the bar in loader tractors in the all-important 100–140¡hp sector, with the Panoramic roof putting it clearly in a league of its own.

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DAIRY NEWS AUSTRALIA MAY 2018

38 // MACHINERY & PRODUCTS

GRUNT

JOHN DROPPERT

Considering the 2WD lifestyle

TWO WHEEL drive is a lifestyle I never really

understood.

Calling it a lifestyle (rather than simply a drivetrain configuration) may seem a little farfetched, but bear with me.

I grew up in a family that did earthmoving contracting with large equal four wheel drive tractors, in a business where 2WD just wouldn’t cut it.

When we got back into dairying and bought a backhoe, that was 2WD, but I assumed (and still do) it was because we couldn’t afford a proper one.

And as told previously in these pages, the old 3CX was a brilliant machine; however with no power to the front, on a slippery farm laneway you could easily end up through a fence. Sad. We eventually graduated and now as far as I can tell, the only thing my parents have that’s 2WD is the lawn mower.

So 2WD was something that I regarded as surviving, rather than aspiring to.

You buy a 2WD machine because you can’t afford MFWD, FWA, 4EWD or any of the other you-beaut ways engineers have devised to make all the wheels pull their weight.

Accordingly, saving my pennies and putting

things in order for my banker, I have lashed out on some 4WD machines of my own. And they’re great; I can drive through all kinds of mud, and not get bogged.

I can carry bigger loads on the front end loader and not leave ruts, or bigger loads on the rear linkage and still have steering. Bias confirmed.

That was until recently, where I have had the misfortune of deferring my children’s future education to fund the refurbishment of not one but two front axles.

Due to a combination of fair wear and tear, possibly some operational over-enthusiasm on my part, and, (I suspect) at least one case of getting sold a dodgy internal repair job, these have become¡—¡to use the mechanics’ term¡—¡flogged out.

Now with the old 3CX, when something went wrong with the front axle, the wheel fell off. You’d get some diesel, a rag and a new bearing, and put it all back together.

Not so with a driven front axle. There’s hubs and housings and bushes and planetaries and universal joints and goodness knows what else, all of which need calibration to the nth degree, and many of which are comprised of parts forged from

the melted down gold of the Inca. Or so their pricing would suggest.

We’ve had some great people on the job, and frankly I doubt these axles will ever break again, but my heart already is. I’m scarred for life.

Things are not as I believed. What sort of world is it where my 40-year old 2WD project tractor and similarly vintage 4¡x¡2 rusted out Jap truck have been keeping the cows fed and chores seen to whilst the more pricey precious petals and their planetaries get their housings machined?

Two wheel drive is not just a poor man’s limitation; it’s a purer form of traction that harks back to a simpler time.

It might be the bill shock, and it might be the lack of rain, but I’ve got a newfound enthusiasm for those machines where less is more, and the front axle is just for steering.

I’ll fix a fence over a front axle any day.

• John Droppert has no mechanical qualifications whatsoever, but has been passionate about tractors since before he could talk and has operated many different makes and models in a variety of roles for both profit and fun.

John Droppert is considering the 2wd lifestyle.

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Revitalising Dairy Production With focus on young stock and innovations to revitalise the dairy industry!

Day 1 (17 July): Industry Events and Symposium Day at Sydney University, Camden Campus, NSW Day 2 (18 July): Farm Day and Emerging Scientists Program at the 2,000-cow dairy, and automatic calf facility at Leppington Pastoral Company, owned and run by the Perich family at Bringelly, NSW We have an outstanding list of invited speakers including: • Calves: the ‘hidden gem’ of dairy farming? - Int’l expert Dr Bob James (USA) • Heifers with Data - Professional heifer grower Cameron Renshaw (Heiferlink, VIC) • Different but profitable dairying?

- Leading robotic farmer Darryl Hammond (VIC) • Data-driven innovative irrigation - Soil and irrigation expert Dr James Hills (UTA, TAS)

• Milk harvesting and milk quality - Top animal scientist Prof. Russ Hovey (UCD, USA) • What technologies work on farm?

- Sydney Uni leading scientist Dr Sabrina Lomax (USYD, NSW) • People’s expectations of the dairy industry – RSPCA Manager Hope Bertram (AUS)

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