Dairy News Australia - March 2018

Murray Darling vote angers farmers PAGE 6

PASTURE

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Targeted feed boosts production PAGE 30

Deutz-Fahr Series 6 unveiled PAGE 36

MARCH, 2018 ISSUE 89 // www.dairynewsaustralia.com.au

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Saputo’s MG purchase won’t include Koroit.. PAGE 3

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NEWS // 3

Koroit proves stumbling block in Saputo’s MG bid SAPUTO WILL not take on Murray Goulburn’s Koroit processing plant in a bid to negate concerns raised by the Australian Competition and Consumer Commission earlier this month.

The Koroit plant loomed as a potential stumbling block in the Canadian processor’s bid to acquire the Australian co-op.

The ACCC said its concerns around the proposed acquisition of the assets of Murray Goulburn by Saputo are solely in relation to the Koroit plant, in particular the impact the acquisition will have on competition for farmers’ milk in the area.

The ACCC said Saputo’s Allansford plant (acquired through its takeover of Warrnambool Cheese and Butter) and Murray Goulburn’s Koroit plant would have over two thirds of the raw milk processing capacity in the south-west Victoria / south-east South Australia region.

However, Saputo immediately contacted the ACCC and said it would divest itself of the Koroit plant and gain clearance to buy MG’s

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assets and liabilities.

Current MG CEO Ari Mervis told shareholders as part of the divestment plan, MG will continue to operate the Koroit plant until the completion of the asset sale.

The Koroit plant will continue to operate and sold as an ongoing operation to a new buyer.

The ACCC was concerned as Saputo’s Allansford plant and the Koroit plants currently acquire the majority of raw milk from dairy farmers in the area.

“Our view is that Saputo owning the Koroit plant would substantially lessen competition for the acquisition of dairy farmers’ raw milk in the region,” ACCC Chairman Rod Sims said.

Fonterra is the only other major competitor with a processing plant in the region.

The ACCC said it was concerned that “Saputo and Fonterra would be more likely to offer lower prices if Saputo acquired Koroit, and that there would be very limited alternatives for many farmers”.

The ACCC says during its extensive consul-

tations with farmers in the area, it heard from dairy farmers who just want the Saputo transaction to proceed.

“We understand Murray Goulburn faces an uncertain future, and that many farmers just want certainty after a tumultuous few years,” Mr Sims said.

“However, if the acquisition of Koroit by Saputo proceeds, our view is that dairy farmers in the region will be worse off and face lower raw milk prices in the longer run.”

Mr Sims said the ACCC believes Koroit would remain in the market, continue to operate, and would likely be acquired by another business if the Saputo acquisition does not proceed.

There are unlikely to be competition concerns in other regions where there is currently no overlap between Murray Goulburn plants and Saputo plants, or in downstream dairy product markets, such as fresh milk, butter, cheese and cream.

The ACCC’s final decision is due on March 29

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NEWS ����������������������������������������������������� 3–17 OPINION ���������������������������������������������18–19 MARKETS ����������������������������������������� 20–21 MANAGEMENT ������������������������������22–24 ANIMAL HEALTH ������������������������� 25–26 About 30 farmers from around Australia visited dairy farms over two days, including Graeme, Jenny and Shaun Cope’s Fish Creek farm (pictured), as part of the Australian Dairy Conference last month.

Read our ADC report from page 12.

PASTURES ���������������������������������������27–35 MACHINERY & PRODUCTS �������������������������������������36–38

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DAIRY NEWS AUSTRALIA MARCH 2018

4 // NEWS

Don’t jeopardise sale: Farmers RICK BAYNE

WESTERN VICTORIAN dairy farmers and

Murray Goulburn suppliers have spoken out against the ACCC’s concerns over Saptuo’s proposed ownership of the Koroit plant, saying they don’t want the sale jeopardised.

Winslow farmer and Murray Goulburn suppler Bernie Free said he couldn’t understand the ACCC’s concern about Koroit.

“I believe the ACCC is being gutless because Western Victoria would be no different to the rest of Victoria,” Mr Free said.

“If Saputo took over Murray Goulburn it would just put Western Victoria is the same boat; Northern Victoria and Gippsland only have two major suppliers.”

Mr Free said he would have preferred Murray Goulburn to remain a co-operative but realised that was no longer possible.

“I don’t support the sale but there aren’t too many options considering the position we’re in,” he said.

“Sadly it’s too late now to stay as a co-operative. We should have been harassing our directors more and earlier but we thought what we were hearing was right, but it wasn’t.”

Mr Free said he believed there would still be strong competition in Western Victoria if Saputo took over MG. “Fonterra is spending a heap of money to make Cobden bigger, and another possibility is that Bega could get a stake in Warrnambool Cheese and Butter to get around the problem.

“The ACCC might be doing this as an attempt to make sure Murray Goulburn isn’t sold overseas but there might be no other options.”

Koroit dairy farmer and former MG site manager Tom Paton said Koroit and Cobram were the two main MG factories. “The ACCC is too far behind and should have stepped in a lot earlier. They’ve left it too late. It’s another thing in a long line of mistakes.”

Mr Paton said Koroit should continue to operate with one million litres of milk and make product to suit the market and be able to pay farmers over $6.

Woolsthorpe farmer Brian McLaren has personally called the ACCC to protest against the commission’s statement.

“They haven’t done their homework in

Jim Doukas.

regards the dairy industry,” Mr McLaren said.

“Their press release has an impact on everyone associated with Murray Goulburn.”

“We’d still have four players in this area if Murray Goulburn goes. How much competition do you need?

“I’ve been a dairy farmer all my life and if they sell the Koroit factory to someone other than Saputo my share portfolio will go down the drain. If they don’t let Koroit go to Saputo, would another buyer pay for my shares?

Mr McLaren disputed the ACCC concerns about milk price. “They ask what about the milk price in five to 10 years; I’ve been battling with the milk price for 40 years.

“Murray Goulburn can’t stay but there aren’t many other options around. Let’s get it done and dusted.”

The concern is being felt further afield. Northern Victorian farmer Gemma Monk said that as an MG supplier she hoped the deal goes through.

“It would be disastrous for me personally and for other MG suppliers and I think the whole

industry would be far worse off if it was to fall over,” she said.

Ms Monk feared that blocking the sale because of Koroit could have severe ramifications for the industry if another buying wasn’t found.

“I wouldn’t see the industry recovering too quickly from it,” she said. “If there is one less player there’s potential for those remaining to say we’ll pay less. It’s a greater risk for pushing milk prices down than if Saputo does take over MG.” “The ACCC says they’re worried about taking over Koroit because it may influence price in the south-west but the price Fonterra and every other milk company pays in the south-west is the same cents per litre as they pay for the whole southern milk pool. It’s not on its own little payment program. I don’t see that argument as being valid.”

Ms Monk added that plans by the Midfield Group to set up a processing facility invalidated the ACCC argument about competition. “I feel the ACCC probably don’t have their heads as far

around the dairy industry as they should have,” she said.

Retired dairy farmer and current Moyne Shire councillor, Jim Doukas, said Koroit was the “jewel in the crown” of MG. “If anyone is going to buy Murray Goulburn they’ll look at Koroit first,” Cr Doukas said.

Cr Doukas said Koroit needed a vibrant milk processor and he was concerned about the impact of delays on farmers worried about their future. “The longer it drags on the harder it is on farmers supplying Murray Goulburn,” he said.

Cr Doukas said the ACCC assessment was based on cream, butter and cheese but there was more to the Koroit plant, and he didn’t agree that competition would be cut.

“Fonterra does have capacity to take more milk at Dennington and they’re adding an extension on in Cobden. They’re big enough to crank up to take on Saputo.”

“We need to look at all the options and be open about them.”

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DAIRY NEWS AUSTRALIA MARCH 2018

NEWS // 5

Saputo demands loyalty STEPHEN COOKE

LINO SAPUTO Jnr has demanded loyalty from potential suppliers in Australia, and also called on rival processors to stop encouraging milk growth without an immediate market.

The CEO of the Canadian-based global processor, Saputo, which has all but purchased Murray Goulburn, addressed 450 suppliers, industry stakeholders and rival processors at the Australian Dairy Conference in Melbourne last week.

Mr Saputo, who the previous day had met with the Australian Competition and Consumer Commission, which is currently reviewing the potential takeover, showed potential suppliers a harder edge to his usually charming persona.

He said over the four years they have owned Warrnambool Cheese and Butter, Saputo had honoured all commitments made to its suppliers and employees, and that Murray Goulburn

suppliers can expect the same commitment.

“Without a strong relationship (with suppliers) you’re only as good as your last transaction,” he said.

“We’re thinking about this business, not year to year, but generation to generation. The lifeblood of our industry are suppliers; without them we don’t have an industry.”

Mr Saputo had “a simple message to MG suppliers”.

“You don’t have to be a co-op to act fairly and responsibly. The ethics, respect and loyaty that we employ every day will be translated to our relationships with suppliers.

“I want to be clear, that loyal, ethics and respect go both ways. We made it clear to suppliers if you are going to be a supplier that jumps around, it will be very tough for us to be loyal in return.

“However, if you’ve been loyal to our organisation and we decide one day to close a plant that’s close to your farm, it’s our responsibil-

ity to make sure your milk comes to one of our facilities.”

Mr Saputo said the company “aggressively” pays down its debt and keeps its “balance sheet clean” to enable it to take advantage of future potential acquisitions.

“The dairy industry has a great future, but as an industry, we need to be mindful of the fact that we need to balance supply and demand.

“Part of my frustration is I think there is a lack of leadership in the industry, perhaps in the producing side. We need to be responsible when putting production on at farm level, that there are consumers for these solids. And if there won’t be consumers, then stock piles will grow.

“If stock piles grow, the prices will be depressed. Somewhere along the line there needs to be better balance in producing the amount that will be consumed.

“I’m hoping somewhere along the line we may have some influence there.

“This is where I’m hoping the industry gets to.

Lino Saputo Jnr.

And with 1.5 to 2 per cent growth per year, I think there’s a great living for every stakeholder in the dairy industry — producers and processors.”

Fonterra co-op proposal must stack up financially SUDESH KISSUN

DAIRY FARMERS supplying milk to Fonterra

say any proposal to them on ownership options must have a sound economic rationale.

Bonlac Supply Company (BSC) deputy chairman Aubrey Pellett says it has talked to Fonterra about its 1300 farmer suppliers investing in the co-op’s Australia’s business.

Mr Pellett said any co-op ownership proposal would need to be economically viable for farmers.

“The mindset here is different from across the ditch; in NZ farmers are encouraged to invest in co-ops,” he said.

“Farmers on both sides of the Tasman have

a range of choice, so the co-op proposal should not be just emotionally attractive but financially attractive too.”

Bonlac’s milk supply agreement with Fonterra expires in December 2019; a broad concept of investing in Fonterra’s Australia operations has been discussed and Bonlac believes it is worth investigating further.

Bonlac meets monthly with Fonterra and discussions are continuing, Mr Pellett said.

“There is no proposal on the table for Bonlac to evaluate; it’s just a concept at this stage.

“The boundaries are still being worked through and our understanding is that it will be an Australian opportunity.”

Personally, Mr Pellett supports the idea of Australian farmers holding shares in Fonterra

Australia.

“I would like to see membership of the co-op enable you to capture some of the value-add component of the total dairy market.

“Also there is security in farmers sending milk to a globally connected dairy player.”

But not all Bonlac members are enthusiastic about becoming Fonterra Australia shareholders.

“There’s a range of appetites out there: some farmers are very enthusiastic, some a lot less enthusiastic and others will look to wait until they can assess the opportunity,” Mr Pellett said.

Mr Pellett said BSC has 1300 suppliers today compared to 1000 two years ago.

While milk production is up in Victoria and Tasmania, farmer confidence still remains low, but has improved, he said.

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“Farmer confidence across the industry is not great ….a lot of people had higher expectations of where the milk price is at,” Mr Pellett said.

“Because of what happened two years ago and the recent climatic challenges, farmers were hoping to see a higher price to restore confidence.”

Aubrey Pellett.

DAIRY NEWS AUSTRALIA MARCH 2018

6 // NEWS – MDBA

Plan unravels with No vote THE MURRAY-DARLING Basin Plan is under

threat after Federal Government changes seeking to distribute water differently were shot down in the Senate.

The Coalition was unable to strike a deal with Labor, which supported a Greens disallowance motion, with it passing 32 votes to 30 on Wednesday night.

NSW Water Minister Niall Blair announced his state would withdraw from the plan and Victorian Water Minister Lisa Neville said the Senate move meant the plan would never be the same.

“I am really angry on behalf of so many Victorians who have done the heavy lifting in regards to this plan, sold water, gone through uncertainty and then to have this thrown in their face by the Senate; it makes me angry,” she said.

However, Ms Neville stopped short of saying Victoria was pulling out of the plan.

She said NSW’s withdrawal meant the plan no longer existed in the form that everyone knew.

She said the Victorian Government would negotiate directly with the Federal Government on the delivery of the water savings projects making up about 600 Gl of water, and that would deliver environmental outcomes.

She said some groups supporting the disallowance had said: “we will just go and buy the water now”.

However, she said there was a cap and there were some delivery constraints that could prevent South Australia getting that water.

Asked if she was disappointed with her Victorian ALP senators who voted for the Greens motion, Ms Neville said she wrote to every senator and warned them that this decision was a critical decision and if they were to disallow this they would be bringing the plan to an end.

“If they did this, they were undermining the plan and everything that had been gained along the way,” she said.

She also said the Victorian Government

would not “cave in” on the delivery of 450 gl, with the qualification of delivery only without negative socio-economic effects.

Queensland Farmers’ Federation (QFF) President Stuart Armitage said it was frustrating and disappointing that positioning for upcoming southern elections had been put ahead of the real issue — the fate of Northern Basin communities and the environment.

“The decision to vote against an independent four year, evidence-based consultation process is unacceptable and may sink the Murray-Darling Basin Plan,” Mr Armitage said.

“There is no doubt that some Basin states will consider walking away from the Plan if politicians start picking and choosing parts of the Plan to support, particularly when it is based on political gain.

“It is critical that politicians quickly reflect on these actions and get back to responsible compromise. No one has got, nor will get, exactly

what they want from the Basin Plan. Historically, there has been an understanding of this and politicians have acted accordingly.”

The developments attracted a direct comment from Murray-Darling Basin Authority, which is usually loathe to insert itself into the political debate.

Authority members, including chief executive officer Phil Glyde, released a statement asserting that the plan was in danger from self-interested groups.

“While others may be able to adopt a deliberately singular view, or manipulate information to serve their own interests, the task of the MDBA in implementing the basin plan is to balance fiercely competing interests and passionately held beliefs by using strong science, evidence and expert judgement …”

“We believe we got the balance right for the environment, basin communities and industry.”

SA farmers biggest losers if Plan abandoned JOHN HUNT

THE LAST week has been filled with commen-

tary and vitriol regarding the Murray-Darling Basin Plan and its fate.

South Australian dairy farmers are the last productive users of Murray River water before it heads into the Coorong.

The water is important environmentally as it passes the lower lakes dairy farms, but in many ways these dairy businesses are the canaries for the river.

If there is a problem, our farmers are the first to wear it.

The future of the river is always in sharp focus for our dairy farmers. For this reason, the political maneuvering displayed in the Senate have greatly troubled them.

The behaviour is indicative of an intemperate political carelessness that just demonstrates how reckless some politicians are prepared to be with regional communities in South Australia and the people who work in those regions.

The Murray-Darling Basin Plan was written

in 2012 to allow adaptive management, with enough flexibility to utilise new knowledge and to adjust operational management of our rivers to get better ecological outcomes while providing a level of certainty for the river and river communities.

While not everyone in the Basin likes the Plan, everyone has been working towards achieving it and delivering a balanced plan.

Neither New South Wales or Victoria have to be bound to the Murray-Darling Basin Plan.

The plan has secured water for the Murray River and those who live and work along it all the way to the mouth.

The comments by NSW Water Minister Niall Blair that the ongoing participation in the plan is untenable is an awful response which we dreaded would result from the Greens’ ill-considered motion.

We have seen an escalation in brinkmanship from all parties that has now entered the domain of stupid. Labor and the Greens with their intransigence have undermined jobs and the future of many regional South Australians in one motion.

Karen and John Hunt on their Allendale East farm.

Little, if anything, legally binds New South Wales or Victoria to the plan. It will be to their advantage to abandon it and the Greens have given them the trigger to walk.

It is simply time for everyone playing games to stop, get back to the table and sort

this mess out.

Otherwise, the losers will be South Australian dairy farmers and the Coorong itself.

• John Hunt is South Australian Dairyfarmers Association President.

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DAIRY NEWS AUSTRALIA MARCH 2018

NEWS – MDBA // 7

‘Politically motivated’ move will be overcome RICK BAYNE

AGRICULTURAL USERS, including dairy farmers, are being used as political pawns in the ongoing row over the Murray-Darling Basin Plan, according to a leading taskforce figure.

Australian Dairy Farmers Basin Taskforce chairman, Daryl Hoey, said the Senate’s decision to block the water reform plans wasn’t unexpected but it was frustrating and politically motivated.

But the news is not all bad for farmers with Mr Hoey predicting the bill will return and be passed.

The Murray-Darling Basin Authority (MDBA) is responsible for overseeing water reforms to boost river health. After a four-year socio-economic and environmental study, the MDBA recommended that the initial recovery target in the Northern Basin be downgraded by 70 gigalitres, from 390 Gl to 320 Gl. Mr Hoey claimed the upcoming South Australian election had influenced the Senate’s decision to block the reforms, preventing the reduction

target from becoming a reality.

“We knew Labor was mounting a campaign to block it but we hoped common sense would prevail given that the northern review process was part of legislation Tony Burke introduced,” he said. “That’s what we find so frustrating.”

“This was all about Labor, the Greens and Nick Xenophon Team being seen to be sticking up for South Australia; it had nothing to do with science or the legislation and it’s all about politics.”

However, Mr Hoey said that if the reforms don’t happen South Australia could end up worse off “and it would be worse for the environment, for communities and for everyone”.

Mr Hoey said the taskforce hadn’t always agreed with the basin authority and challenged and many of its processes. “However, this was one instance they got it right; they went through public consultation, they got the science and did all the work and went through the minister with a recommendation to reduce the northern take by 30 Gl and then it got chopped by politics.”

“They’d been through the review process and found they could achieve the same environmen-

tal outcomes with 70 Gl less taken out of the system then that’s how the model should work.

We should remember the basin plan is about improving environmental outcomes, not about magical numbers of water and if we can achieve the same or better environmental outcomes through better technology or engineering that’s what we should focus on.”

While his frustration continues, Mr Hoey says dairy farmers don’t need to panic at this stage and that the hold-ups could be temporary with little impact at the Murray mouth.

“This equates to around 2–3 Gl of water at the Murray mouth. It has no material impact but due process wasn’t followed. That’s what’s so frustrating.

“The basin communities and agricultural sectors that are reliant on the water have been used as political pawns; we’re the ones being hung out to dry,” he said.

“But once we’re past the South Australian election things will be back on track. The review will be re-submitted to parliament and more than likely pass.”

Mr Hoey said he believes the Basin Author-

ity will review the science and submit an alternate number or re-submit the same information.

“Unless another curveball is thrown at us, we’ve got to wait six months and if it gets resubmitted I think it will get passed.”

Daryl Hoey believes the bill voted down by the Senate will be returned and successfully passed.

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DAIRY NEWS AUSTRALIA MARCH 2018

8 // NEWS

a2 Milk strikes deal with Fonterra PAM TIPA

A2 MILK CO has struck a deal with Fonterra that will enable it, over time, to diversify its milk sourcing, processing and manufacturing to meet growing demand for its products, the company says.

Fonterra and a2 Milk Company (a2MC) have signed a deal that links the New Zealand co-op’s global milk pool and supply chain, manufactur-

ing, and sales and distribution with a2MC’s brand strength and capabilities.

Fonterra will now begin talking to its farmers to source an A2 milk pool for a2MC products in New Zealand and Australia.

Fonterra chief executive Theo Spierings and a2MC chief executive Geoffrey Babidge say they expect to grow demand in NZ and offshore for a2MC’s products.

“The partnership is intended to fast-track

market growth and this creates opportunity for our farmers to create additional value from their milk,” Mr Spierings said.

“Consumers like to have choices and the growth of a2MC branded nutritional powders and fresh milk sales in Australia, for example, show the potential.”

Mr Babidge said the partnership gives a2MC significant medium and long-term opportunities via "multi-site and geographic diversification and

new product development". It will give access to large scale manufacturing performance and competitive terms in a global context, he said.

“The relationship with Fonterra is the ideal model to build brand awareness and deliver a consistent high-quality product to the broadest customer base in this market.

“The opportunity to work together with Fonterra to explore new markets and products is also significant," Mr Babidge said. The co-op’s resources and capability in many of a2MC’s new priority markets should help speed the distribution of a2MC products.

The new Fonterra partnership: New Zealand and Australian milk pools will support the partnership. Fonterra will talk to its farmers on the best way to source A2 milk and share the value it will create for farmers. The milk pools will expand over time.

Under a ‘nutritional products manufacturing and supply agreement’ (NPMSA) with a2MC, Fonterra will exclusively supply nutritional milk powder products in bulk and consumer packages for sale in a2MC’s new priority markets in South East Asia and the Middle East. These products will be at Fonterra’s NZ plants and at its nutritionals plant, Darnum, in Victoria.

The two companies plan distribution and sales arrangements to assist a2MC’s entry into its new priority markets in South East Asia and the Middle East.

Exclusive period to explore a2MC branded butter and cheese, and China-sourced liquid milk for sale in Australia, NZ and China. These would be complementary to Fonterra’s existing product range.

A jointly owned packaging facility will be explored under the NPMSA to cater for growth.

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Non-homogenised milk from NSW’s South Coast Dairy was recognised as a finalist in this year’s Australian Grand Dairy Awards.

South Coast Dairy is owned by the Berry Rural Cooperative Societ. It built a plant at Berry, NSW, and began production in June, 2016, handling 2.5 m litres milk per year, assuring a fair farmgate price for its six suppliers.

Its South Coast Dairy branded full-cream, light and skim milk is sold across the South Coast NSW, and as far afield as Orange, Wyong and Sydney.

A new range of products, including flavoured milks and a South Coast brand butter, is expected to come online this year.

South Coast Dairy was one of three finalists in the milk section alongwith Farmers Own and eventual winner Maleny Dairies.

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DAIRY NEWS AUSTRALIA MARCH 2018

10 // NEWS

Shepparton upgrade key to Freedom Foods expansion STEPHEN COOKE

FREEDOM FOODS will increase the capacity of its Shepparton plant and contract more farmers in the area directly.

Freedom Foods, is a diversified dairy and food producer with products on supermarket shelves in Australia, Asia and the US, and is the largest producer of UHT milk in Australia with plants in Sydney as well as Shepparton.

The factory produces UHT milk for the export market and the company is completing the installation of extra filling and processing capacity which will enable them to process up to 150 million litres of milk this financial year, compared to last financial year’s throughput of 85 million litres.

Total volumes for the 2019 financial year are

MILK BOOST BOLSTERS BEGA’S HALF-YEAR PROFITS Bega boosted its milk intake by 25 per cent and subsequently drove volume of its cream cheese and mozzarella cheese, helping it lift overall profits.

However, Executive Chairman Barry Irvin observed that the benefits of the increase in milk volumes in the first half due to a successful milk acquisition

currently estimated at 250 m litres.

Freedom Foods announced its half yearly profit of $16 million on net sales revenue of about $159 million.

Managing director Rory McLeod forecast a growth in sales revenue this financial year as a result of growing consumer demand.

The company has finalised installation at Shepparton of additional 1 litre format capacity as well as upgrading processing capability and downstream packing.

It has also ordered additional processing and filling upgrades for installation later this year.

Mr McLeod said Freedom intends to expand its direct supply strategy with farmers to provide for growing milk demand.

The company expanded its “Freedom Farmers” sourcing strategy last year, establishing direct

program and strong spring intake would not be repeated at the same level in the second half.

The increase in milk intake drove volume growth of 19 per cent in cream cheese and 33 per cent in mozzarella cheese.

The six months to December 31 saw the company boost volume intake to 456 million litres, with most of this heading to the Tatura plant in northern Victoria.

Mr Irvin said the extra milk intake improved manufacturing efficiencies.

The company’s 2017–18 first-half net

supply contracts with dairy farmers in Victoria and NSW. “The direct supply strategy seeks to align a medium term volume, quality and pricing relationship that supports the growth demands of the company and provides our farmer partners with a stable revenue basis to invest in their farms,” he said.

Freedom Foods is launching a UHT A2 milk under its Australia’s Own banner in Australian supermarkets as part of its strategy to expand domestic and export sales.

The brand is well established in domestic retail through Freedom’s organic plant drinking range.

The company is developing distribution of Australia’s Own Infant Formula in SE Asia and Australia.

Australia’s Own is already the leading imported children’s milk brand in China.

profit after tax jumped almost a third to $20.6 million, thanks largely to extra milk volumes and earnings from its newly bedded down Kraft brand purchases.

Bega announced statutory EBITDA growth of 46 per cent to $51.7 million and profit after tax growth of 31 per cent to $20.6 million.

The normalised performance of the business was also stronger with an EBITDA growth of 65 per cent to $70.1 million and profit after tax growth of 77 per cent to $36.6 million.

“The business has performed well

The company believes expansion into a broader range of UHT milk will accelerate the growth of the brand and dairy sales for the company locally and in key export markets in Asia.

Mr MacLeod said the recent expansion of its dairy processing capabilities meant the company was well positioned.

Rory McLeod.

particularly when you take into account the significant corporate costs associated with the recent acquisitions and the highly competitive environment the business is operating in,” Mr Irvin said.

Mr Irvin said Bega Cheese was very much in the transition phase of the newly created Bega Foods. It has also increased investment in the newly acquired Vegemite and Zoosh brands and invested heavily in branding and promotion for Bega-branded peanut butter, following bega’s acquisition of the Kraft peanut butter range.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

NEWS // 11

Mixed reaction for new milk model A NEW milk model which would allow dairy farmers to sell certain percentages of their milk to different processors throughout the year has been developed by a group of farmers and discussed with processors.

Scott Briggs, spokesman for the group, which includes 20 dairy farmers, that developed the new pricing tool for the industry, shared the concept at the Australian Dairy Conference.

The new concept, called Milk Choices, is based on the principal of selling milk to more than one customer.

“The Milk Choices concept is not designed to replace current arrangements but to provide an alternative that farmers can opt into if it suits their businesses.”

Mr Briggs said a handful of farmers came together to build a concept that “we could hand over to the broader industry to consider, refine and make its own”.

He said the group of about 30 people included those with specialist expertise in the field.

He stressed it was purely a concept for industry development rather than a commercial offering and said although the solution would not suit everybody, farmers should have the right to choose.

“The Milk Choices concept is not designed to replace current arrangements but to provide an alternative that farmers can opt into if it suits their businesses.”

Under the system, the farmer has the right to sell milk under Fixed Volume Contracts to a Foundation Processor and other buyers.

Under these Fixed Volume contracts, the Foundation Processor delivers milk to other buyers whenever the farmer contracts with them (earning a fee in the process).

The farmer is only able to commit a certain percentage of forecast volumes per month to Fixed Volume Contracts to manage production risk.

Under this system, a farmer would enter a Foundation Processor Agreement with Processor A. The farmer can then decide to spread risk by putting 50 000 kg of milk solids on the open market.

Under Fixed Volume Contracts, Processor B buys 40 000 kg for February delivery on an index linked price, and Processor C would the remaining 10 000 kg for April at a fixed price.

This means Farmer Brown’s milk is split between processors A, B and C at different times of the year under different pricing mechanisms.

Mr Briggs said discussions with more than 100 farmers gained a positive response. However, reaction since it was released has been mixed.

Northern Victorian farmer Daryl Hoey said he hoped the industry joined forces to kill the idea.

“It’s one of the stupidest ideas I’ve heard in my life,” Mr Hoey said. “It doesn’t do anything about a better milk price and it would create even less transparency. If farmers are going to do deals with other processors they’ll all be signed in confidentiality so no-one will know what anyone’s getting.”

Mr Hoey said that if farmers sold to multiple processors they would run the risk of losing incentives.

Mr Hoey said he believed the concept may have emerged from ACCC findings about limitations on production increases and limited processor choices in markets such as Queensland and Western Australia.

“Part of the ACCC finding is that if you want to increase your production you should be allowed to offer that milk to other companies, but in the south-east milk pool we’re not

restricted and we’ve got more processors we can choose to supply.

“I could double or quadruple my production tomorrow and my processor will pick my milk up and be grateful for the extra production.”

Mr Hoey said he feared payment would be difficult and confusing if farmers were selling to more than one customer.

He questioned how it would work in autumn

when milk supplies drop, and added that he doubted major processors would want to be involved in sharing supplies.

“I’m old school and remember an industry when we all worked together. This is just more fragmentation; pitting farmer against farmer and processor against processor,” he said.

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DAIRY NEWS AUSTRALIA MARCH 2018

12 // NEWS – ADC

Bioengineered dairy is coming STEPHEN COOKE

BIOENGINEERED DAIRY is coming and the

dairy industry must decide now how it plans to differentiate its product, according to Kaila Colbin of Silicon Valley think tank Singularity University.

Ms Colbin told the Australian Dairy Conference that dairy would not be immune to the rapid rate of change and disruption occurring in all aspects of the world.

Milk is already being created in laboratories, as is other proteins including meat and eggs.

Ms Colbin said this bioengineered milk has the same chemical characteristics and molecular structure as traditional milk — “it just hadn’t come from a cow”.

“I think it sounds disgusting. I was talking to someone who was creating eggs and I won’t eat eggs unless they come from a chicken.

“She said: They’re not targeting me. They don’t care about you, they’re not interested in the hippies, they’re not interested in the vegans, they don’t care about whole food.

“They’re targeting industrial caterers who buy eggs by the thousands of kilos, and they need them in powder form, and in liquid form, and in tube form, and they need them to last longer on the shelf, and be 100 per cent salmonella free,

with total certainty of supply, and they need them to brown nicely on the edges.

“And taste more like egg! And they need them to be cheaper, and by every one of those metrics, the bioengineered product wins.

“And maybe bioengineered milk product wins against those metrics as well.”

To demonstrate the rapid rate of improvement occurring in this sector, Ms Colbin said the cost of the first kilogram of bioengineered beef was $2.3 m. With improvement, the cost for the second kilo was $40 000 kg and the third $18/kg.

“It’s still expensive but the price continues to come down. That’s what exponential technologies do,” she said.

“We have a choice. Either we embrace this stuff, and know it’s absolutely coming, and the only way we can deal with it is get ahead of it, or we have to completely differentiate ourselves by going hard up in the other direction.

“For example, go biodynamic, where customers can scan the milk bottle and see a video of kids swimming in a stream next to the dairy farm in Australia.

Domino’s Pizza global dairy ingredient buyer John Harney would later tell the conference the pizza chain bought its annual intake 7000 tonnes of 30 per cent fat-reduced mozzarella cheese from a Californian company because it couldn’t find a local partner that can supply it in Australia.

Kaila Colbin.

This is because the supplier can produce the version of cheese that meets their exact specifications at a low price. If bioengineered dairy can meet specifications at a cheaper price, it would make business sense.

Mr Harney said he could envision Domino’s using bioengineered milk on pizza in the next 20 years. Already, 3 per cent of Domino’s pizzas use vegan cheese, and demand had stunned the company.

Saputo Managing Director Lino Saputo Jnr

later told the audience he would hope any products using bioengineered foods would be labelled accordingly.

“Consumers should have choice in what they are consuming. I believe that at a retail level there might be some protection for consumers.

“I’m hoping that protection would follow to the foodservice trade.

If you go to a restaurant and they serve you a hamburger you hope that it’s hamburger meat, and the same thing with dairy products.”

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DAIRY NEWS AUSTRALIA MARCH 2018

14 // NEWS – ADC

Use stick on bad farmers STEPHEN COOKE

BAD BEHAVIOUR by a minority of farmers remains the industry’s biggest problem.

Members of a 7-person panel discussing hot issues in dairy industry, and all said the industry needed to deal with its ‘weakest links’.

Margaret Stuart, head of corporate and external relations at Nestle Oceania, Margaret Stuart told the conference the dairy industry kept her awake at night.

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Nestle.

Nestle was highlighted in the media and despite cutting ties with the farm immediately, it remains linked to the farm on social media sites.

“We deal with consequences to this day,” she said.

“Call out bad behaviour. Call out bad practice. Don’t be afraid to do that because as an industry, like any industry, it’s only as strong as its weakest link.

“That bad behaviour is your weakest link.

That’s the stuff that will be exposed and that’s the stuff that will pull you all down.

“So call it out privately before you have to deal with its consquences publicly.”

Hawkesdale farmer Lisa Dwyer said the industry would need to change its approach to dealing with those who refuse to change.

“The vast majority of people do the right thing and work hard in caring for the environment, animals and people, but we do have a minority of recalcitrants that seem to defend, refuse, say they can’t, say they’re special etc.

“Our industry for the duration has been very good to supply carrots for the right behaviour but really reluctant to provide the stick.

“If our industry has the courage to apply the sticks where it’s required, then we’re not going to be faced with regulation that is far more costly and far more onerous.”

The industry needed to address potentially problematic issues, such as bobby calves and dehorning, before those decisions were taken from it.

Philip Wright, a senior adviser with the Ethics Centre, said farmers needed to think about what would happen if they did not address issues such as bobby calves.

If it wasn’t addressed, “someone may say you have to hold bull calves on farm for 12 months,” he said.

Ms Stuart said part of Nestle’s “social licence to operate” included extra costs to meet consumer needs in terms of animal welfare. Despite these extra costs, Nestle can’t raise their prices to meet them.

The belief that calves could be grown out as veal flies against the low demand for veal in Australia, which RSPCA chief executive Heather Neil said due to the image of veal as “crated calves”.

She said the RSPCA was developing a standard for veal production, from birth to slaughter, to build consumer trust.

DAIRY NEWS AUSTRALIA MARCH 2018

NEWS – ADC // 15

Fresh insights for new farmer ATTENDING THE 2018 Australian Dairy Con-

ference in Melbourne recently has given Telena Walsh from Circular Head, Tasmania, the impetus to help her father Chris fulfil his dream of farm ownership.

The 21-year-old attended the conference thanks to a bursary from Australia’s Legendairy Women’s Network (ALWN) — an opportunity she was alerted to through Dairy Australia’s Regional Development Program, DairyTas. At the conference, Telena soaked up the atmosphere, networking opportunities and information, gaining knowledge to take back to her own workplace — a newly converted dairy farm, Montagu Dairies, which is owned by her parents and their equity partner Anthony “Hans” Lissington and managed by Chris.

At the conference, she was particularly inspired by Lino Saputo’s life story and a highlight was the full day tour to Gippsland’s dairy region, where she visited farms that, like Montagu Dairies, are starting to use whey products to feed their cows.

“There were lots of things to take back to the farm,” she said.

“We all work together and share ideas so it

was great to hear from so many good speakers and to look at how farms in Gippsland do things.

“It was really good to socialise with dairy farmers from all around Australia and around the world. I’m already in two local discussion groups run by Dairy Tas, but I’d love to go to the conference again.”

Now back working on the former beef property, which was converted to a dairy farm less than a years ago, Telena says being a new employee in a new enterprise is constantly challenging.

“It’s exciting; every day is different,” she said.

“You’re clearing bush, putting in new fences and changing everything all the time.”

Previously, her parents Chris and Gillian had leased a farm, but had always wanted their own place. The current equity partnership is making that a reality and Telena couldn’t be happier to be playing her part.

“I know farming and enjoy the lifestyle and when I left school there wasn’t anything else I wanted to do. My father has been doing it since he was 16 so it’s probably in my blood. Having a farm was always his dream and I want to help him achieve that.”

Telena Walsh.

DAIRY NEWS AUSTRALIA MARCH 2018

16 // NEWS – ADC

Young scientist examines Tasmanian R&D uptake A YOUNG scientist has discovered three out

of five dairy farmers in Tasmania own a pasture measurement tool and only two in five use it.

Her work to discover why and how to increase this rate saw her win the Young Dairy Scientists’ Award at the Australian Dairy Conference.

Alison Hall is a PhD candidate at the Tasmanian Institute of Agriculture (TIA), exploring technology in Tasmanian dairy farming and how to optimise its role and uptake for improved pasture management.

As part of the project she is exploring why and how Tasmanian dairy farmers make decisions around pasture management, and what factors drive their engagement with extension activities.

In the initial phase of the project, Miss Hall distributed a survey to all of Tasmania’s 440 dairy farms to find out the extent of current and previous use of tools and technology for measuring pasture, including a rising plate meter or CDAX bike reader.

The survey also asked farmers about their involvement with extension activities to deter-

mine the drivers behind current on-farm practices.

“With a high response rate of 38 per cent, the survey has been able to provide a snapshot of what is currently happening on Tasmanian dairy farms in terms of pasture measurement and monitoring, and what factors have impacted on this,” Miss Hall said.

“The survey found that three out of five dairy farmers in Tasmania own a pasture-measurement tool, but only two out of five currently use them.

“It also found that farmer engagement with extension in Tasmania has been high, with 86 per cent of farmers having attended general extension activities, and 76 per cent having attended an activity specifically focused on pasture management.

“Analysis from the surveys was used to inform a series of in-depth interviews with farmers to explore what influenced changes to past and current practices, how pasture management has changed over time, and the sources of information and learning.”

There’s a positive link between farmers

attending extension activities and currently using a tool to measure pasture.

As a result of attending a pasture specific extension activity, 38 per cent of farmers made a change to their management — with 35 per cent purchasing a pasture measurement tool, however only 7 per cent started using that tool to measure pasture.

“Through understanding this level of detail in what drives decision making behind adoption, I hope to understand how farmers can be further supported in optimising their pasture management, and how we can continue working towards this goal in extension,” Miss Hall said.

A key focus of research, development and extension in the Tasmanian dairy industry has been on increasing awareness, knowledge and use of best practice pasture management principles and practices in order to optimise pasture management and production on farms.

Other studies have found that farmer confidence in managing pasture increases through the intensive use of pasture measurement tools, partly due to their role in the pasture management learning process.

ADC scientific director Richard Rawnsley with the winner of the Young Scientists Award Alison Hall.

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DAIRY NEWS AUSTRALIA MARCH 2018

NEWS – ADC // 17

Sarah Thompson, Rachelle Moon and Kristeen Culton.

Adam Jenkins, Margot and Stephen Henty, and Sam Henty.

Lucy, Richard, David and Sue Boyd.

Young scientists Min Wang, Ruchika Perera, Paula Giraldo, meteorologist Jane Bunn, ADC Science Director Richard Rawnsley, young scientists Beth Scott, Alison Hall and Pablo Alvarez, and Daniel Dixon, Dow Agrosciences.

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DAIRY NEWS AUSTRALIA MARCH 2018

18 // OPINION RUMINATING

EDITORIAL

A tough but rewarding job

MILKING IT...

Long memories Rochester locals were less than impressed many years ago when the council agreed to a request from Murray Goulburn to close one of the main roads, which was subsequently built over.

So with the last worker turning out the lights on their way out when the factory closed last month, it was left to one local to have the final word.

“And to think they closed that bloody road.”

It’s true that some people have long memories.

One hump or two We’ve seen a few interesting things at dairy shows over the years – the day a judge checked the bottom of teats glue comes to mind – but are yet to see a camel, as happened at the Bega Show last month.

A six-month-old camel stood tall among the dairy calves during the junior dairy parade, but even more intriguing was the camel catching lessons extolled by owner Geoff Cochrane after the event.

Geoff, who captured the camel while working as a feral pest bounty hunter in the Simpson Desert, told the Bega District News: “The best way to catch a camel is by the tail.”

“You’ve got to chase them for a time to test which one is the fastest because that’s the one you want.

“Then you grab him by the tail, when you do he will swing to bite you but that’s when you can get a hold of him around the neck.

“You gain a camel’s respect and trust by holding your face close to theirs and breathing into its nostrils,” he said.

“It’s the same technique I use to tame my bullocks and horses, but it doesn’t work with humans.”

NSW salutes Barnaby Joyce

Vote 1! Feed Buddy 200

Barnaby Joyce wasn’t receiving a lot of love last month so he would have appreciated kind words from NSW’s Dairy Connect.

“The national dairy industry has lost a friend and strong Government ally with the departure from the front bench today of Deputy Prime Minister Barnaby Joyce,” Dairy Connect CEO Shaughn Morgan said.

Morgan said Joyce had brought to the role an “in-depth understanding of the economics and the culture of dairying”, and noted his championing of dairy farmers following Fonterra and Murray Goulburn’s decision to slash prices overnight.

Joyce was instrumental in the ensuing financial rescue package and then commissioned the ACCC to conduct its wide-ranging review.

He was a huge advocate for dairy, his inattention to detail would sometimes come back to bite him, and he probably had equal number of friends and critics throughout the sector.

One thing’s for sure, it’s going to be bloody boring without him.

Natural showman Paul Stammers, Katunga, Victoria, won The Pitch competition at the Australian Dairy Conference last month for his Feed Buddy 200 – calf feeders made from recycled 200l chemical drums.

The innovative idea, which takes all of 5 minutes to build, saw Paul snare the most votes from the three judges, but also the People’s Choice Award.

With lines like: “It costs less to make than what Parmalat pay for a litre of milk in the spring”, and “Before this, drums were about as useless as a former Murray Goulburn CEO”, Paul had the popular vote in the bag.

The Pitch had our vote for best segment in what was a very impressive conference.

Advertising James MacGibbon

0409 103 745

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.

Publisher

Printed by Production

Dairying is a tough way to make a living and when the manure hits the fan it can be particularly brutal.

Despite the past 18 months, the mood at the Australian Dairy Conference held in Melbourne last month was overwhelmingly positive.

Farmers from around Australia shared stories of success achieved over years of good and volatile seasons.

None of them had it easy but they were achieving their goals.

Conferences like these can inspire you, but it’s also easy to leave and think: “Well, back to the real world.”

The world where prices have dropped, or the irrigator has broken down, or those mastitis levels just won’t budge despite much trial and error to find the problem.

What inspired us at this conference were the stories from farmers who were able to create wealth and further opportunities because of dairy.

Five young dairy farmers from different parts of Australia, all in their early 30s, told the audience how they have grown wealth and built equity despite starting at the bottom.

For those who shared their figures, their average net worth is $637 000. That’s hard to achieve at a desk job in the city.

It’s hard in any job to keep your eye on the big picture, particularly when you’re in the slog of the working day, every day. There will continue to be daily challenges on farm and at manufacturing level.

Consultant John Mulvany, who helped share the story of these five farmers with the audience, reminded everybody to: “Keep an eye on the big picture — it’s easy to get lost and discouraged in the daily grind.”

He had some other gems: “There will be a minimum of 8–10 years where the pressure will be on and you wonder whether you’re going anywhere.”

However, John said honesty was essential. “If over time wealth is not appearing, have a good look in the mirror. Don’t blame the industry or others.”

Dairying is a hard gig — on top of the daily grind, other challenges are coming hard, including bioengineered foods, animal activists and global milk gluts — but there are rewards.

It was good to be reminded of that.

Shepparton Newspapers Pty Ltd Newsprinters Pty Ltd Stacey Taylor

0427 124 437

editor@dairynewsaustralia.com.au Regional editor Geoff Adams

news@dairynewsaustralia.com.au

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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 MARCH 2018

OPINION // 19

Decadence on the menu OFF THE SHELF MADELEINEBRENNAN

YOU KNOW you are feeling particularly unwell if you forgo an opportunity to sample the delectable wares of the finalists at the 2018 Australian Grand Dairy Awards.

Such was the case for this dairy lover and columnist when the winners were announced in Melbourne last month.

Now in its 19th year, the Grand Dairy Awards are issued across 18 categories including cheese, ice creams, milks and yoghurts, from Australian dairy producers both big and small.

If you’re keen to sample some of the winners, the expert judges favoured Melbourne’s Montefiore Cheese as the 2018 Grand Champion Cheese, with its “soft and sweet” Ovoline.

The top gong in the dairy product category was awarded to Sydney-based Pure Gelato, for its

Salted Pistachio flavour which, although could be technically seen as just an ice cream version of the humble salted bar nut, is decidedly more exotic.

Its rich, deep green colour is a sure sign that it’s packed full of generous quantities of quality pistachios If you’re more of a fan of going by that excellent Australian tradition known as ‘the Pub test’ — officially known as the popular vote category at the AGDAs — then seek out South Australian favourite The Yoghurt Shop’s Passionately Passionfruit Yoghurt, which nabbed more than 13 ,000 votes to take out the prize.

You could also follow the people’s lead after a recent consumer-led push saw Cadbury bring back its Caramilk flavor, despite being discontinued in the 90s.

Described as a ‘Golden blend of caramelised white chocolate’, partly I think to hide the fact it’s slightly unnerving light brown colour, it’s worthy of a trip down memory lane.

I’m already thinking about putting it in a cheesecake ….

If Cadbury Australia’s Facebook page is anything to go by, Caramilk’s return to the supermarket shelves has been so popular it’s sometimes hard to find.

Although this may in some cases have been due to the unfortunate fact a batch had to be recalled due to a factory error. (Any Caramilk dated

Montefiore’s Ovoline cheese was named Grand Champion Cheese.

17/1/2019 and 21/01/2019 (only) should not be consumed and can be returned for a refund — otherwise, chomp away!)

With Easter soon upon us, the folk at Cadbury are pulling out all the stops to entice us into the chocolate aisle.

They’ve launched an ice cream version of the Cadbury Cream Egg, and while I have to confess I haven’t tried it yet, I’ll be asking the Easter bunny to deliver straight to the freezer this year as I anticipate this cracking idea (pun intended!)

Pure Gelato Enterprises’ Salted Pitstachio was named Grand Champion Dairy Product.

will deliver on the decadence front.

For the more traditionally-minded, there’s also those cute mini eggs perfect for the kids’ Easter egg hunts.

The little tackers must have developed a more sophisticated palette than Back In My Day, with Cadbury releasing a new salted caramel flavor.

I assume this is also done with the full knowledge that parents steal half of them anyway ….

• Madeleine Brennan is an avid consumer of all things dairy.

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DAIRY NEWS AUSTRALIA MARCH 2018

20 // MARKETS

FRESH AGENDA JO BILLS

A bigger picture of dairy trade

AS PART of our work, we have a unique ability to add up the dairy product that is traded around the world and look at the larger trends that will continue to influence returns for farmers.

We recently did a round up of 2017 trade, which at first glance grew an impressive 3.2 per cent in milk equivalent — based on exports of milk powders and cheese.

However, this was compared to the 2016 year when the EU was busy building its SMP intervention mountain. In 2017 EU-28 SMP exports grew 36 per cent after falling 17 per cent in 2016, with the bloc accounting for 35 per cent of trade.

It’s been an impressive performance from EU exporters overall in 2017, who have more than recovered from the loss of the 250, 000t Russian cheese market, which continues to be closed to them.

EU’s trade expansion since the Russian embargo was imposed back in August 2014 has been broadly based — including Middle-East and North Africa (MENA), where there is a proximity and some preferential access, but also growing Asian and North American markets. [See Graphic 1] Looking at overall dairy trade on the basis of milk solids (based on fat and protein in common product specifications for WMP, SMP, butter, AMF, whey powder and FFMP and taking account of estimated composition of cheese sales) - the actual volumes of butterfat and protein exported is more indicative of the market reality.

In milk solids equivalent terms trade improved marginally — just 0.4 per cent over 2016, but with divergent underlying trends. Supply shortages and high prices stifled trade in butterfat, which fell 4.4 per cent in 2017. [See Graphic 2] On the other hand, protein trade increased 4.4 per cent, thanks to increased SMP trade. In fact, global SMP trade grew 8 per cent in 2017 to reach an all-time high, underpinned by demand from frugal buyers stocking up on cheap ingredients.

The other growth product for global bargain hunters was fat-filled milk powders (FFMP) — a range of products and mixtures that substitute non-dairy components to reduce ingredient costs.

FFMP exports grew 14 per cent in 2017 — key demand regions included sub-Saharan Africa, MENA and the CIS. Cheap SMP and the rising popularity of FFMP have kept a lid on WMP prices and demand.

Global WMP trade fell 3 per cent in 2017, and almost 13 per cent since China’s late-2013 buying frenzy peaked.

WMP demand in China and SE Asia improved in 2017, but this was more than offset by reduced imports from price-sensitive MENA buyers and a more self-sufficient South American region.

New Zealand is highly exposed to WMP, and its exports actually fell 5.6 per cent in milk solids in the face of more aggressive competition from EU and US competitors.

Infant formula gets a lot of coverage in the media in Australia, but when it comes to trade it’s all about EU and China. Global trade in infant formula grew 13 per cent in 2017, with the EU accounting for a massive 76 per cent share.

On the demand side China (including Hong Kong) accounted for 47 per cent of infant formula imports, as the trend toward finished products and away from base ingredients continues.

To put this demand growth in perspective, in 2014 China represented less than 30 per cent of trade. Just in 2017 Chinese infant formula imports grew 38 per cent.

Where did Australia figure in dairy trade in 2017? On a milk solids basis, the industry accounted for 5.2 per cent of global dairy trade.

This ranks the industry fifth — behind Belarus, which has been a significant beneficiary of the Russian embargo. In fact, Australia’s dairy imports were slightly more than half of it exports on a milksolids basis in 2017.

Cheese is the key product exposure for Australia’s southern dairy industry, and global trade in that category grew steadily at 2.5 per cent in 2017.

EU exporters increased shipments by 4 per cent in 2017 to account for 41 per cent of trade in the category. Australia had an 8 per cent share of cheese trade in 2017. While cheese is an important export, Australia has also steadily increased cheese imports over the years, and in 2017 there

EU’s share of trade into regions (MSE) Total

33.3%

SubSah.Africa

67.8%

Asia

26.5%

Oceania

21.9%

Cntrl.America

2013

41.0%

China & HK

2017

16.2%

CIS

12.6%

Nth America

32.3%

Sth America

14.4%

MENA

51.5%

Graphic 1. was a notable increase in cheaper US product.

This reflects global sourcing strategies of quick service restaurant and food manufacturers and underlines the fact that Australia is part of a global dairy market.

Even if exports account for a smaller share of milk production, imported product ensures the domestic market for tradeable dairy commodities can’t be insulated completely from international price trends.

It was a strange year for dairy trade in 2017,

and it’s largely a story of EU policy and market dominance across the major product categories.

In the face of intervention policy and resurgent milk production, New Zealand weather gyrations have been something of a side show in 2017 — with arguably much less influence on commodity prices than we have seen for most of the decade.

As the 2018 global dairy trade story unfolds it will continue to be mostly about the EU. Grab the popcorn and watch this space.

Growth in MSE exports in % NZ

-85

-5.6% 7.0%

EU

93

9.2%

US

48

-7.8%

Aust Arg

Growth in MSE ‘ooot

-19

-26.4%

-31

Brazil -38.7% Urug

-4

-16.3%

-17 53.2%

Ukraine Belarus India Turkey

-0.3% -1.6%

0 -5

-9.5% 49.3%

Canada TOTAL

21 -1

19 19

0.40%

Graphic 2.

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agribusiness // 17 DAIRY NEWS AUSTRALIA MARCH 2018

ort demand remains strong

MARKETS // 21

European stockpile proving harder to disperse

cents/litre in March (AUD 41c/L) to 28 a few incremental change in milk production (year-on-year) Euro cents/litre (AUD 36c/L) in April. s now Profit margins are under pressure in the s farmUS, and in NZ Fonterra has announced oming the final payout for the 2011/12 season ocused has been cut from NZ$6.75-$6.85/kg MS incorgLobaL impacT to NZ$6.45-$6.55/kg MS (AUD$4.96ed ‘tier GLOBAL IMPACT JohN DropperT JOHN DROPPERT $5.04). armer Effectively, global dairy markets are y. For rebalancing. Lower prices will both iented Shifts in private label contracts and proslow production growth and stimulate ative to cessor rationalisation have seen milk demand, and as this occurs we will ultito the companies adjust their intake requireThis contrasts sharply with the additional AMIDST THE up-again down-again commenmately see a price recovery. Key factors seems ments and pricing to meet the chang30 000 tonnes that wasscene purchased on international dairy markets to watch on the global will be theduring the ing demands of a highly pressured retail in the last m term tary 2017rate campaign. years, one of the mostprices commonly discussed at which milk production overseas marketplace.

Lower contract and emand few slows in to historical lower prices, the the size of a lack of alternative supply opportuniWhilst farresponse from the peak, infl uences is the ‘European stockpile’. impact ofstockpile the currentisfinancial worriesthe market milk production in the US those in south-east Asia and the Middle present challenges in a market withof flows. utlook ties the current overhanging The almost-380,000 tonnes skim 2012 milk rices – limited manufacturing capacity. Despite is up around 4% on 2011 for the year to East maintain consistently higher eco- on consumer confidence, the path of and forms one of the factors keeping SMP prices powder (SMP) amassed by the European Com12: Sit- these challenges, the underlying domes- April (leap year adjusted), whilst early nomic growth rates that support China’s economic growth, and the value subdued other commodities have seen a mission as part of its attempts to smooth out of thewhere Australian dollar. for an tic market is stable, with steady per-cap- data suggests EU-27 milk production increased dairy consumption. HowrelativeDemand recovery 2016. and keep the farmers of the theMarch 2012 quota year up ever, the surge in supply has outpaced forsince exported dairy prodfinished ita dairyforces consumption and a growing .40/kg market uctsinitial remains a positive and will con2.3% on theoff previous year. New Zealand demand growth in the market. population providing range 28-member The hardline approach to sales by the Europeana degree Unionofincerbusiness and tinue to grow the middle classway in to a perThis situation has seen the scales tainty beyond the current adjustments. production is widely expected to finish S. The the Commission haswith gradually given streets. large emerging markets such as China, In the seasons following the 2008 this season up 10% on last year - a huge tip in favour of buyers in dairy maret picceived sense of urgency as the stock ages, and For those of us a bit more used to letting the actors financial crisis and subsequent com- market influence given 95% of NZ milk kets, with commodity prices retreat- with changes in diet and with increasing it could be argued that this in itself is weighing nisms that had allowed the system to work. market ‘do its thing’ (even if grudgingly), the ent sit- modity price recovery, farmers in is exported. Argentina is also enjoy- ing steadily over recent months. Butter urbanisation - and also in conjunction on the market. plenty of 30% timefrom to their concept is intriguing tosolid say the with global population growth. Locally, are down some ingleast. solid productionEuropean growth, but aproducers sig- priceshad export-oriented regions have seen in the whole as othermarket commentators prepare forprevents quota removal and in many the have And A comprehensive history all ofnificant this could the domestic is supportedhave by a explained 2011 peaks, whilst powderofprices supply gap in Brazil global supply growth (see chart) of - with growing population and SMP stableprices per- have also lost more than 20%.

Farm gate prices much of this additional from leavhigher-cost competitors in the sed on take in these pages, supressed more milk efficient producer states, milk production up a year’s worth of thisNorthentire publication, consumption. the dairy have subsequently been reduced helped in capita ing South America. erninHemisphere those expandarmers but create the butterWhilst shortage that caused all surged. short, theamongst stockpile has come about by way Despite wider economic uncer- most exporting regions. The average market is currently a challenging place e form ing output as their margins increased.

In the midst of the unrelated geopolitical manner of consternation late last year. of the European Commission’s Public Intervenntracts This season, favourable weather con- tainty, demand has remained resilient basic farm gate price for milk in France to be a seller, all signs indicate that balwhat’s to be done?

With no easy answers crisis like thatChina sawand the for Russian (‘Intervention’) will ultimately return. example,market droppedclosed 12% fromto 32 Euro Soance ditions have further tool. enhanced milk as importing countries upply. tion

The size of the current stockpile is overhanging the market and forms one of the factors keeping SMP prices subdued where other commodities have seen a relative recovery since 2016.

This is one of the market mechanisms the European sellers and the bursting of the Chi- to the question of disposing of the stockpile, the Commission uses to help fulfil the broader dairy nese milk powder bubble, this deluge of new Commission’s initial focus for 2018 has been to policy objective of creating stable market con- milk came at a bad time. By the end of the 2016 prevent it becoming larger.

To achieve that, a temporary change to the campaign, around 350 000 tonnes of SMP was in ditions for EU milk producers and processors. operating regulations has been effected which It’s part of what’s commonly referred to as storage.

As commodity prices recovered in the second changes the fixed price volume (normally the ‘safety net’, intended to protect the sector EAN-Australia-New half of 2016, the Commission began offering 109 000 tonnes) to zero. from ‘serious market imbalance’. aland FTA (AANZFTA).

In other words, any and all SMP purchased Intervention allows the Commission to product for sale via tender, however to date only “Protectionist sentiinto Intervention will be via a tender process, purchase up to 109 000 tonnes of SMP, and around 6,000 tonnes has been sold. nt over agricultural 50 000 tonnes of butter between March 1 and ods is rife and growacross September the globe, so 30 each year at a fixed price, and addito provide portion pack austraLian FooD tional by tender thereafter. his context it isvolumes pleas(200-330ml) configuracompany Freedom Foods Australia has managed tion for beverage prodGroup Ltd is to build a When conditions allow, the product is sold orge anback agreement new milk processing plant ucts.

400 onto the market via a tender procedure. h Malaysia that has The NSW location will to cash in on growing Intervention has been around in some form 350 lt with some sensiprovide access to the most demand in Asia. or another e agricultural issues since the 1960s, and helped create the The plant, to be built in sustainable and economic notorious of butter and SMP accu300 effectively covered‘mountains’ by southeast Australia, will be source of milk. Pactum has NZFTA,” says Fraser. strong links to the Austrathe first Australian greenmulated during the 1970s and 1980s.

250 Sealing thethe deal: stockpile Malaysian trade minister Mustapha Mohamed “While under fields expansion in UHT in lian dairy industry and will At the its peak in 1976, of SMP with Australian counterpart Craig Emerson after signing the deal.

NZFTA agreement expand its arrangements 10 years. exceeded 1.1 million tonnes. Reforms that 200 st of Australian agriwith dairy farmers for Freedom’s wholly included of milk producbut also through technical Despite the compleers introduction through streamlining ture’s key intereststhe 1984 supply of milk. The new owned subsidiary Pactum 150 quotas, as lower intervention prices, or so called ‘behind the tion of this agreement, of rules-of-origin decd tariffstion bound at zero,as well plant will increase scope Australia will run the much remains to100 be done border’ restrictions.” laration processes and and for ry and rice are two secplant. Some of its products for Australian milk supply ultimately helped manage the issue, large The FTA was signed on Australia’s farmers to improved s whereparts incremental – value-added, sustainable will be sold in Australia. of the 2000s, theremarketing was no SMP inforpublic May 22 in Kuala Lumpur tap into the full potential arrangements for certain rket access improveand export focused.

The company says 50 storage at all.

by Australia’s Trade and of the Asian region and commodities. nts have been negotiInitially the plant will given Asian consumThe scheme The didMalaysian successfully accumuCompetiveness Minismarket beyond. d under the Malaysian produce 250ml and 1L ers’ rising incomes and 0 late and subsequently clearA$1 stockpiles of He 200– ter Craig Emerson and his says the NFF will is worth about bilA. UHT packs from a process improving diets, demand 300,000 tonneslion twice between 2002 and Malaysian counterpart now2012, throw its attention in Australia agricul“This trade deal was line capable of 100 milthere will grow for qualtowards ensuring agricul- Mustapa Mohamed. exports – including o particularly lion L. The processing and ity dairy products from but inimpor2015 the tural elimination of milk production Emerson says Australia ture remains front and being its fourth-largest t for sectors such packaging plant will emit low-cost production bases quotas removed one of the key balancing mecha-

sia FTA benefits dairy Freedom

dairy that have been ing a competitive disantage in Malaysia mpared with New Zead which already has ompleted FTA with laysia in place.”

The FTA also sigs some administrative nefits for Austran agricultural export-

Foods plant targets Asia

allowing the Commission absolute control over volumes, whilst preserving the intended ‘safety net’ function for use if required.

Numerous proposals have been put forward to dispose of the existing (and rapidly ageing) stocks. Some of these are relatively straightforward, including the current tender process, enhanced usage in animal feed channels, and allocation to the EU’s ‘deprived persons’ schemes.

Others range to the absurd; highlights include using the excess SMP for fish feed, biogas or even burning it. The ultimate outcome will likely involve a mix of the more sober suggestions, many months (if not years) and a great deal of expended wealth on behalf of European taxpayers.

And whilst some of the measures being advocated are as unlikely as they are ridiculous, they do underscore the increasing pressure being placed upon the Commission to solve the problem.

Perhaps ironically, a drag on farmer (and taxpayer) finances created by the very market support scheme intended to protect them.

• John Droppert is senior industry analyst with Dairy Australia.

sugar export market and fifth-largest wheat export market.

With an annual economic growth at about 5%, Malaysia forms an important part of the ‘Asian Century’ story and the opportunity this presents for Australian agricultural producers, says Fraser.

centre in completed FTAs with South Korea, Japan, China and Indonesia as immediate priorities.

“These are all markets with enormous growth opportunities and where significant barriers to trade in agriculture still exist, not only through tariffs that restrict trade

will be as well-positioned in the Malaysian market as Malaysia’s closest trading partners in ASEAN, and in some cases better.

The FTA will guarantee tariff-free entry for 97.6% of current goods exports from Australia once it enters into force. This will rise to 99% by 2017.

such as Australia, whose milk is well regarded.

The new plant will allow Pactum to meet growing demand for UHT dairy milk, and add to capacity for valueadded beverages at its Sydney factory. Pactum is expanding its capabilities at the Sydney plant

less carbon, use less water, and be more energy-efficient than equivalent UHT facilities in Australia and SE Asia. Pactum expects site preparation to begin in October 2012 and start-up by mid-2013.

Pactum makes UHT products for private label and proprietary customers.

6/06/12 1:41 PM

Source: European Milk Market Industry

Aug-17

Feb-17

Aug-16

Feb-161

Feb-15

Aug-15

Aug-14

Feb-14

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Feb-13

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Aug-12

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Feb-11

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Feb-10

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Aug-02

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Feb-01

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Feb-00

thousand tonnes

European SMP in public storage – since 2000

DAIRY NEWS AUSTRALIA MARCH 2018

22 // MANAGEMENT

High risk system reaps rewards RICK BAYNE

GIPPSLAND’S IAN Cougle admits he runs a high risk system with a high stocking rate, but the rewards are highly appealing.

Ian and wife Kerry recently hosted an Australian Dairy Conference tour where 30 farmers and service providers from around Australia enjoyed insights into Gippsland’s production systems.

He readily admits he “pushes the system” to get the most out of his land and his cows and so far it’s working.

He has risk management strategies in place to counter poor seasons and then looks to capitalise when the prices and pastures are good.

Mr Cougle’s farm at Willow Grove peaked this year with about 1200 milkers; 65 per cent Holstein Friesian and about 35 per cent cross bred.

They have stocked more than 1000 cows since about 2001 on a total of 570ha, milking off 325ha.

All replacements are kept on farm.

Mr Cougle’s parents bought the original 250 ha farm in 1970 and about nine years ago Ian added a 140 ha block about 8 km away.

It was a beef operation until the expansion to 570 ha in 1989 when it was partly converted to dairy.

Dairy eventually took over, although sons Sam and Ben continue to run a small beef operation and 62 ha of the home farm is leased to his sister and brother-in-law.

About six years ago Ian was faced with a dilemma — either sell the farm or build a new dairy. He opted for the latter, replacing a wornout 50-unit Rotary with a new 60-unit version

and he’s happy with the choice.

“It was a double-edged sword; if we decided to get out people would come in and look at the dairy and ask how long it would last,” he said.

“We’re very happy we made the decision to do the dairy.”

Around the same time there was a restructure in ownership of the farm, with Mr Cougle’s sister and brother-in-law moving on to another venture. It now runs as a partnership between he and Kerry and his mother Janice.

When hosting the Australian Dairy Conference tour, Mr Cougle outlined the farm’s production philosophy in conjunction with his long-term adviser, Jeff Urie from AgChallenge Consulting.

“It’s very much pasture based and based around having a high stocking rate and converting as much grass as possible directly into milk,” he said.

The push to a high stocking rate escalated in the late 1990s when the farm was selected as a Gipps Dairy Focus Farm.

On the milking area, the farm stocks about 3.6–3.7 cows per hectare. It’s totally dryland farming and across the whole 570 ha they have about 2.1 cows per hectare, plus replacements.

When they were the Focus Farm they pushed stocking rates up to four cows per hectare.

“We’re pushing the system,” Ian said. “We use urea fairly heavily on every grazing except when moisture is limiting. It’s determined by when growth rates drop down to a certain level and we’re not getting the response rates out of it.”

“I find it easier to manage a high stocking rate rather than dropping back to a low rate,” he said.

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WHO:

Ian and Kerry Cougle WHERE:

Willow Grove WHAT:

High stocking rate

The new 60-unit rotary dairy.

“You don’t have a lot surplus of grass or have to deal with pasture quality. In the spring period you’re converting a lot of grass straight into milk.”

They supplement pasture grazing with homegrown silage and some purchased feed.

The farm receives about 900 mm of rain each year but Mr Cougle is finding seasonal patterns are changing. “We seem to be getting longer dry periods later into autumn,” he said.

“We’re finding we have to supplement feed during autumn more than we have in the past.

At the moment we’re feeding our own silage and bought-in vetch and grain.”

Production runs at 1600 kg/MS per hectare.

The farm is mostly rye-grass plus they sow 10–15 per cent of the milking area to chicory every spring.

“When we do our autumn sowing with ryegrasses we only put in one variety at a time to see how that variety performs,” he said.

“It’s horses for courses with rye-grasses. We have varieties that work on our farm that don’t

Brendan Hehir from Wyuna in northern Victoria and Brad O’Shannessy from Cooma with Willow Grove host farmers Ian and Kerry Cougle and GippsDairy’s Leah Maslen. The Cougles hosted an Australian Dairy Conference tour where 30 farmers and service providers from around Australia enjoyed insights into Gippsland’s production systems.

work on other people’s farm so we do our own trials.”

Mr Cougle plans to continue with his high risk, high stocking rate system.

“We’re on dryland with no irrigation but that’s why we now have 570 hectares for risk management. It’s also risk and reward as well. Even in a poor year we try to make sure we break even or manage the losses but in a good pasture growing year we do really well.”

“I don’t stress about what I can’t control like price; I worry about getting everything right on my farm and that’s based around trying to get high pasture consumption and turning grass into milk.”

TALKING ABOUT MENTAL HEALTH REMOVES PRESSURE Ian Cougle thinks being upfront about

mental health issues can open the door to recovery. Finding a good spot to take a break doesn’t hurt either.

About 10 years ago the Willow Grove dairy farmer went through a difficult time, but by talking about it and making changes he was able to get back on track.

Mr Cougle opened his farm and shared his personal story as part of the Australian Dairy Conference tour.

Initially he was reluctant to admit he had some mental health concerns.

“I was telling everyone I was sick and not feeling well but not explaining it,” he said.

He reached the stage where he didn’t want to have anything to do with the farm.

“I got to a point after a period of about 18 months where I’d put in a lot to work to get the farm where I wanted it to be and then had a bit of a meltdown.

“I had to get my wife Kerry to come with me to go back to the dairy to do some planning stuff. I was lucky I had

good staff at the time.”

Kerry rang consultant Jeff Urie who spoke to Mr Cougle. “He went through a few situations and made me feel a lot better and I ended up seeking some professional help,” he said.

He was reluctant to go on medication but talking helped uncover the cause of the problem.

“It ended up that I had put in all this work and wasn’t getting any down time,” he said. “I changed how I address things and I now have time for myself.

“We have a holiday house At Lakes Entrance. It’s only a bit over two hours away but it’s amazing to have that time away from your role as a farmermanager-owner.”

Mr Cougle encourages people who may be having problems to talk about it.

“In our discussion group we have chats about mental health and being open. It takes the stigma away and it’s about helping each other. People are much better once they share the problem.”

• Rick Bayne

DAIRY NEWS AUSTRALIA MARCH 2018

MANAGEMENT // 23

Testing diets to keep cows cool FOLLOWING RECENT hot weather in Victoria, it’s appropriate that the next experiment at Ellinbank will be one in which different diets will be tested for their capacity to keep dairy cows cool in summer.

This work will complement previous experiments that identified genetic markers for heat tolerance and the mechanisms by which heat tolerant cows were able to keep their core body temperature cooler.

The modern dairy cow is highly susceptible to heat stress, which causes millions of dollars in lost production in Australia every year.

Temperature and humidity that exceed certain thresholds lead to significant declines in milk production, feed intake and fertility.

These problems can be worse in grazing cows because the opportunity for providing shade, sprinklers and fans is often limited to when the cows are at the dairy.

This is why Agriculture Victoria researchers have been working to identify and breed heat tolerant dairy cattle …and they are now looking at how to feed them.

they limit the opportunity for the cows to dissipate body heat and, as a result, the increases in body temperature can accumulate from day to day.

During the course of the 32-day experiment, 24 heifers that had been identified as heat tolerant and 24 heifers that had been identified as heat susceptible were exposed to the controlled heat challenge and their production, physiology and metabolism responses were measured.

The modern dairy cow is highly susceptible to heat stress, which causes millions of dollars in lost production in Australia every year.

“What we found was that the heat tolerant cows maintained higher milk production and feed intake during the heat challenge,” Ms Garner said.

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Josie Garner.

In previous work, the genomic estimated breeding value (GEBV) for heat tolerance in Australian dairy cattle was developed by a DairyBio research team.

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by Dr Bill Wales, and implemented by DataGene.

The validation involved selecting heifers that were predicted to be either heat tolerant or heat susceptible, and exposing them to a mild-moderate heat challenge in a controlled-climate environment.

“We wanted to mimic the daily fluctuation in temperature and humidity that would occur during a mild to moderate heat event in a temperate climate,” Agriculture Victoria Research Scientist, Josie Garner said.

“Therefore we set the temperature to fluctuate between 25°C at night and 33°C during the day, with 50 to 60 per cent relative humidity.

“We also wanted to simulate the fact that heat events in the temperate environment are commonly sporadic, sudden and short-term, resulting in large temperature increases from generally mild summer conditions,” she said.

“The duration of these heat events is commonly up to four consecutive days, so that is how long our imposed heat challenge lasted.”

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“They also maintained a core body temperature that was 0.6°C lower than heat susceptible cows …a remarkable finding.

Continued page 24>

DAIRY NEWS AUSTRALIA MARCH 2018

24 // MANAGEMENT

< Continued from page 23

Part of the Ellinbank facility where the research takes place.

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“A proportion of the milk yield difference was related to the reduced feed intake, but the experiment also demonstrated thermoregulatory differences between heat tolerant and heat susceptible cows.”

The heat tolerant cows were able to dissipate heat more efficiently via evaporative cooling. For example, they had a skin surface temperature that was 1.7°C higher, which indicates greater heat dissipation through the skin surface.

The next step is to develop nutritional strategies that farmers can use to keep their cows cooler during periods of hot weather.

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Agriculture Victoria researchers Dr Leah Marett and Dr Peter Moate will lead a series of experiments that will investigate different feed additives, supplements, forages and concentrates for their capacity to lower the heat of fermentation within the rumen.

It will also investigate the capacity of these diets to reduce the drop in feed intake and therefore milk production that commonly occurs during hot weather.

The first experiment will commence in February using 24 cows and will monitor the physiological responses and milk production of cows during a heat challenge when fed a feed additive and a fat supplement, both alone and in combination. Future experiments will also test different concentrates and forages.

Overall, genomic selection for heat tolerance is a promising option for increasing the resilience of the Australian dairy herd in the face of the increasing threat of heat stress.

“Ultimately the aim is to develop a “cool” diet that farmers can feed during summer when heat events are likely,” Dr Marett said.

Cool diets offer further potential for reducing the impact of heat stress on all cows, whether or not they are genetically predisposed to heat tolerance.

This research was funded by the Federal Department of Agriculture, Dairy Australia and the Victorian Department of Economic Development, Jobs Transport and Resources.

DAIRY NEWS AUSTRALIA MARCH 2018

ANIMAL HEALTH // 25

APIAM ANIMAL HEALTH GEMMA CHUCK

Reading the signals

RECOGNITION OF disease in young stock is

an integral part of their management. Some diseases have obvious clinical signs, whilst others can be more difficult to detect.

It is important to recognise subtle ‘signals’ from animals, which let us know they are in the early stages of disease. Early identification of sick animals allows prompt treatment with a more favourable prognosis and outcome.

This article discusses the behaviour and signals displayed by healthy and sick calves.

eyes, nose and hands to first evaluate the calves as a group, followed by individual assessment where required.

Factors to consider when evaluating the group include: the distribution of the calves in the space provided, the uniformity of the calves (body condition score, abdominal fill, height, cleanliness and hair coat) and group behaviour.

Whilst observing the calves as a group, take

note of any animals hanging back or lying separately. These animals may be in the early stages of disease and require further examination.

It is useful to compare any notable observations seen today to those seen yesterday to assess the duration of any potential disease process.

For example, the calves may all have been drinking well yesterday morning but this morning almost half of them are slow or incomplete

feeders, suggesting something has happened over the past 24 hours.

This emphasises the importance of consistent observation skills between staff, along with reliable communication and accurate records.

When evaluating the individual there are many parameters that can be measured to assess the health and well-being of the animal.

Continued page 26 >

The Healthy Calf Healthy calves typically rest with their feet tucked underneath them and their head around to one side. Sometimes calves will rest in a ‘flat out’ position.

When lying down and resting, calves should be evenly distributed in a pen.

Accumulation of calves lying in tight groups when there is ample space available is suggestive of cold-stress.

When active, their eyes should be bright, shiny, symmetrical and free from cloudiness or discharge.

The eyeballs should be in continuous contact with the eyelids (ie. not sunken), which should be open even in bright daylight.

A calf’s ears should be erect, positioned parallel to the ground, symmetrical and responsive to sound. There should not be any discharge form the ears or head tilt in any one direction.

The nose should be moist, clear and free from discharge with even airflow in both nostrils. This can be seen be wrinkling of the skin on the outside of each nostril.

A healthy calf should willingly and frequently lick both nostrils with her tongue and there should not be saliva hanging from her mouth.

Any abnormality of the eyes, ears or nose warrants further investigation and prompt appropriate treatment.

A healthy calf will show ‘play behaviour’ from an early age.

Play behaviour promotes development of the skeletal muscles and brain, self-awareness of physical ability, social interaction and learning to respond and adapt to unexpected events.

Calves may start galloping around as a group with sudden changes of direction, buck, kick their hind legs and twist their bodies. Housed calves will often buck as a response to provision of fresh bedding.

Flight and submission are not expressed in play behaviour in young calves, although some postures associated with aggression such as head butting, are commonly seen.

The tendency for play behaviour to develop into real fights increases as calves grow and reach maturity.

The presence of play behaviour in young calves can be used as a measure of animal welfare as it is only seen when calves feel no serious threats or challenges.

Thus the motivation to play indicates a state of good welfare. Lack of space, lack of other calves or lack of suitable objects to play with may prevent play behaviour.

This can be a disadvantage of individually housed calves as they do not have full social contact to exhibit play behaviour.

Identifying the sick calf The old adage of “Don’t just look: Observe!” is one to remember in the calf shed. Use your

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DAIRY NEWS AUSTRALIA MARCH 2018

26 // ANIMAL HEALTH

Don’t let lameness derail production goals

< Continued from page 25

are in the late stages of disease and have a less favourable prognosis.

Once a sick calf has been identified your action next will depend on what you are currently dealing with on your farm.

However, if this is the first time you have seen this condition it is recommended that prompt veterinary advice is sought.

Each farm is different and the problems encountered and treatments prescribed will differ on a farm-by-farm basis.

This emphasises how written treatment protocols, established in conjunction with your veterinarian, can help you select the most appropriate treatment for a given condition in a timely manner.

• Gemma Chuck is an adviser with APIAM Animal Health.

The interpretation of the clinical examination requires veterinary expertise. However, there are several observations that can help identify calves in the very early stages of disease.

Slow or incomplete drinkers (when not previously so) should be examined for other signs of disease. This may be the first signal that a calf is beginning to feel unwell.

The presence of droopy ears, a dry nose and staining of faeces around the tail and hind legs are signs that a calf is sick.

An elevated rectal temperature (>39.5oC) is often evident in the early stages of disease, whilst a normal or low rectal temperature in an obviously sick calf is a sign that the disease is more advanced.

Calves that have sunken eyes, are unable to stand or have a weak or absent suck reflex

JOHN LYNE

THERE ARE three aspects associated with dairy

farming that can elevate or decimate farm profits and individual cows — feed, fertility and lameness.

All three are highly related, outside environmental causes to lameness.

Feed

Key Messages • Early recognition of sick calves allows prompt treatment and a better prognosis for recovery.

• Healthy calves should be bright, alert and responsive and exhibit play behaviour.

• One of the earliest signs of a sick calf is slow or incomplete feeding.

• Consistent observation skills between staff, good communication and accurate records allow sick calves to be identified earlier.

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As obvious as it may seem, feed and fertility are well research-proven limitations to farm profit.

Based on the Australian 305-day lactation average milk production, clearly we are underfeeding our cows by at least 4 kg dry matter daily.

We have bred cows through genetic advancement that have far greater capacity for converting feed dollars to milk dollars, yet we have not taken advantage of our investment in genetics when our national average milk production is half that of the United States Cows are cows and feed is feed, irrespective of delivery system — grazed or TMR (total mixed ration).

Producing more milk from the same fixed costs, increases our competitiveness, but more so, our profit.

Having the feed to optimise our cows’ capacity for converting it to milk dollars is a multifaceted issue.

Suffice to say, number one is allowing cows access to feed per se. From there we look to planning the growing of forages that are highly digestible.

We can fill a cow to contentment with hay, but she will not convert that hay to much milk.

Worse still, the conversion of hay dollars to milk dollars is not profitable due mostly to very slow digestibility rates that limit daily DM intakes.

From here we look at energy and protein densities.

How much energy and protein is in each kilogram of dry matter consumed by our cow?

She has a physical limit to DM feed intake, so the higher the energy and protein in each kg DM of feed, the higher the total energy/protein intake will be, and obviously, how much milk she will produce daily.

We run a ratio in our diet analysis program of energy to maintenance and production.

This ratio is critical in determining feed cost per litre of milk produced.

Further, as this ratio shifts according to feed intake, digestibility and energy density, the cost of producing a litre of milk rises or falls rapidly.

There is a multiplier effect occurring in the shifts of this ratio; for better or worse.

Feed intake, digestibility and energy/protein density are the macros of dairy nutrition and production.

However, the next plane is mineral nutrition.

Our forages are a mixed bag of minerals, some excessive and some deficient.

For example, our forages tend to be between excessive and highly excessive in potassium fertiliser dependent.

Our cows have a massive requirement for calcium, and pastures are very low in calcium; likewise, magnesium.

It is essential we supplement our cows to regulate excesses and supply deficiencies.

Cows also have a high salt requirement.

Next we need to consider trace minerals.

Although they are supplemented in very small amounts, they are highly essential to many biological functions of dairy cows.

Trace minerals are not very bio-available from plant tissue, and must be supplemented via mineral pre-mixes in grain.

The critical roles of commonly supplemented trace minerals and vitamins are: ■

■

■

Copper, manganese and zinc play important roles in protein synthesis, vitamin metabolism, the growth of ligaments and immune function.

Cobalt is essential to B12 vitamin production in the rumen, and if not limited, will supply all the cow’s need for B12.

Vitamins A and D are commonly supplemented despite their natural availability from green forages and sunlight respectively, to ensure no compromised requirement.

Fertility There are two other essential supplements that I have left until we look at fertility, as they are critical to that major profit driver.

They are the trace mineral selenium and vitamin E. Both have vital roles in uterine health, therefore fertility.

Further, both are antioxidants that have important roles in stabilising fatty acids and soluble vitamins. Their role in reducing toxicity of fats is very significant in our grazing-based system as pasture has very high fat.

Fertility then becomes a natural and serendipitous outcome of a fresh cow that has not suffered excessive negative energy balance from underfeeding, or pre-calving nutrition, has her mineral and vitamin requirements met, and then, a healthy and vital uterus.

Lameness The one issue that can decimate all the above is lameness.

Lameness prevention has specific nutritional needs, all of which are mentioned above related to milk production and fertility.

However, to highlight a few very necessary preventative measures, we ensure adequate zinc is fed for formation of sound hoof material.

Limit weight loss post-calving which can reduce the fat pad and its shock-absorber function in the heel, and of course, feed buffering agents and adequate effective fibre for good rumen health and mitigation of sub-optimal ruminal pH (SARA).

Supplementing Biotin in mineral mixes added to grain has significant benefits to hoof integrity.

Addressing environmental causes to lameness such as track maintenance, minimising sharp turns on concrete or covering with rubber mats will reduce injury and wear to hooves.

Applying zinc sulphate and copper sulphate solutions alternately via absorbent mats while exiting dairies are beneficial in drying and hardening soles during wet conditions, reducing risk of stone punctures and bruising.

Despite our best efforts in all the above, I cannot stress enough that failed transition nutrition will severely reduce our ability to enhance our cows’ capacity for profitable lactations through feed, fertility and the absence of lameness.

• John Lyne is dairy production specialist with Dairytech Nutrition.

DAIRY NEWS AUSTRALIA MARCH 2018

PASTURE IMPROVEMENT // 27

NZ trip paves the way for higher production ALWAYS ON the search for greater efficiencies

with milk production, Mark and Ann Gardiner of Bamawm near Echuca are well aware their pasture systems need to be closely managed. Mark is clearly of the opinion that home-grown forage is still the cheapest feed source for his dairy.

“With the cost of water, a lot of growers up here have gone away from permanent pastures because they don’t want to water pasture over summer,” he said.

“For us, summer crops would come with a substantial cost to establish, fertilise, water, conserve and feed out, so while the debate goes on, we’ve stuck with the permanent pasture system.”

Mr Gardiner’s dairy milks about 800 cows with a split between autumn and spring calving. Most of the 280 ha grazing property is permanent rye-grass pasture with a small amount set aside for Lucerne.

After a recent trip to New Zealand, the Gardiners are on a path of improvement to boost their production with new, faster growing varieties.

“In the past we’ve relied on a rye-grass vari-

ety called Matrix. It was okay in its day, but we had concerns about its productivity because of a few issues including rust. It’s a hardy variety that’s high in endophytes, so it wasn’t always palatable and can cause heat stress in the cows.

“The New Zealand trip was a real eye opener,” Mr Gardiner said.

“In the South Island we visited Lincoln University, different farming systems and a company called Agriseeds near Christchurch. Rob Winter from Heritage Seeds explained some of the global genetic breeding technology that goes into the development of each variety.”

Agriseeds is a sister company to Heritage Seeds in Australia.

“We had a look at new pasture varieties and when we got back, I was keen to try a perennial rye-grass called Bealey. It came out on top of many of the NZ trials. As a permanent pasture farmer, I was left thinking, we can produce more from our land and make better use of water.

“Last autumn I over-sowed Bealey into a couple of old Lucerne stands and planted it into a small paddock where the weeds had been sprayed out.

“During the year we looked at the stand, how leafy it was, how it spread, how fast it grew and how quickly the cows were able to come back onto it.

“Overall, it was impressive. I was extremely happy with Bealey, so happy in fact that we have a wide area to put in again.

“The cows did very well on it. Even into February it looked soft and leafy while the other rye-grass looked harsh and fibrous with the heat.”

Mr Gardiner said with Bealey the rotations came around quicker.

“Instead of the cows being out for 25 to 26 days they were back in after 22 to 23 days. If we can shorten the rotation it really makes a difference and it points to a possible 10 per cent production boost.

“I think it’s important to identify the aspects of management that limit production. In this case, changing the pasture variety boosted production without really having to change any other inputs.”

Mark said the Bealey needed careful management in the initial stages to enable it to estab-

A trip to New Zealand at the end of 2016 really opened the eyes of Mark Gardiner of Prairie to the productivity improvements that can be gained with new, more palatable faster, growing ryegrass varieties.

lish, in particular when sod sown.

He said last year they milked 800 cows with an average of 620 kg of milk solids.

• Article supplied by Heritage Seeds.

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DAIRY NEWS AUSTRALIA MARCH 2018

28 // PASTURE IMPROVEMENT

Just how much does your pasture system cost?

ON-FARM MONITORING and measurement of pastures, delivered under Murray Dairy’s Accelerating Change project, has demonstrated the impact of seasonal variability on feedbase production and profitability. Partnering with several farms across the region, the project assesses the production, water use and cost of different pastures.

Structuring their feedbase using a combination of annual and perennial pastures, crops and conserved feed, participating farmers have been able to fill feed gaps, minimise costs and opportunistically increase production when the conditions are favourable.

Using an Automated Pasture Reader that has been calibrated for regional growing conditions, growth rates are calculated for perennial and annual rye-grass pastures, lucerne and fescue, and used to estimate yield. Coupled with nutritive testing, this enables farmers to compare the value of different forages within their system and to measure their performance over time or under different seasonal conditions.

Information about growth rates and nutritive characteristics allows farmers to assess the impact of different management strategies on pasture performance.

On one farm the growth rates of rye-grass and lucerne were measured under different irrigation intervals. One bay was irrigated once per grazing, putting it under water stress, and the other was irrigated three times in two grazings, a strategy based on water needs indicated by a soil moisture probe. In pasture, one bay was also dried off completely over summer. Water deficiency in perennial pasture resulted in production losses which were especially pronounced towards the end of the season.

Whilst many farmers in the region continue to use perennial rye-grasses, they express concern about its persistence over time. Research into the long term impacts of dry off and partial irrigation on rye-grass is currently being undertaken by Agriculture Victoria. So far their study has shown no lasting impact of dry off/partial irrigation in the first year after recommencement of irrigation, but a slowed recovery in the second year. The project will be extended to measure impact over time and to consider the effect that other plant characteristics, such as endophyte status and water soluble carbohydrates (controlled through grazing management) might have on plant persistence.

Consistent with research conducted in the region by the State Government lucerne production on farm was directly correlated with water applied, up to the point of meeting plant water requirements. The bay irrigated more frequently

produced more lucerne during the season.

The following season, where lucerne bays received the same amount of water, there were no significant differences in growth rates observed between them. Consistent with regional research outcomes, the trial showed no long term yield penalties or persistence as a result of prior water stress.

Pasture samples are cut, dried and weighed throughout the growing season to calibrate the Automated Pasture Reader.

COST OF PASTURE PRODUCTION OVER TWO IRRIGATION SEASONS (2015–17) PPP (2016–17)

PRG (2016–17)

PPP (2015–16)

PRG(2015–16)

800 700

$679

600 $/tDM

HARRIET BAWDEN

500

$467

$454

400 300

$300 $255

200 100

$208 $139 $49

0

$391

$300 $312

OCT

$188

$182

$141

$118

$92

NOV

$256

$215

DEC

JAN

$92

FEB

MAR

This graph shows the impact of water price on the cost of production of perennial pastures on one farm (PPP = perennial rye + paspalum, PGR = perennial rye)

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PASTURE IMPROVEMENT // 29 Full Year (June 16 – May 17)

Full Year ( June 15 – May 16) Perennial Rye-grass FERTILISER NITROGEN HAY & SILAGE Making costs IRRIGATION Cash Cost

606 Total TDM $11.41 TDM $32.25 TDM

Perennial Rye-grass FERTILISER HAY & SILAGE Making costs

$14.78 TDM

IRRIGATION Cost ($55ML)

$55.63 TDM

$83.49 TDM

PASTURE IMPROVEMENT

$11.09 TDM

$11.86 TDM

Total Cash Cost

$81.50 TDM

PASTURE IMPROVEMENT

$18.02 TDM

Without water costs

$25.87 TDM

Without water costs Annuals FERTILISER NITROGEN HAY & SILAGE Making costs IRRIGATION Cash Cost FUEL & OIL PASTURE IMPROVEMENT Total Cash Cost Without water costs Lucerne FERTILISER NITROGEN

$157.03 TDM $73.54 TDM 441 Total TDM $11.41 TDM $32.25 TDM $8.29 TDM $58.32 TDM $11.86 TDM $18.02 TDM $140.16 TDM $81.83 TDM 692 Total TDM $11.41 TDM $ - TDM

HAY & SILAGE Making costs

$12.52 TDM

IRRIGATION Cash Cost

$76.27 TDM

FUEL & OIL

$11.86 TDM

PASTURE IMPROVEMENT

$10.22 TDM

Total Cash Cost Without water costs

Annuals FERTILISER HAY & SILAGE Making costs

1369 Total TDM $26.42 TDM 0 TDM

IRRIGATION Cost ($55ML)

$39.25 TDM

PASTURE IMPROVEMENT

$29.55 TDM

Total Cash Cost

$95.23 TDM

Without water costs

$55.97 TDM

Lucerne FERTILISER

1000 Total TDM $11.41 TDM

HAY & SILAGE Making costs

$12.52 TDM

IRRIGATION Cost ($55ML)

$76.27 TDM

PASTURE IMPROVEMENT Total Cash Cost Without water costs

PP Irrigated Schedule 60–70 mm ETo-R

0 TDM

0 TDM

FUEL & OIL Total Cash Cost

PASTURE ACCUMULATION RATES (kgDM/da/day) BASED ON MONTHLY CALIBRATIONS 2015-16

75 Total TDM

$10.22 TDM $110.42 TDM $34.15 TDM

Lucerne (irrigation 1)

Annual

PP Irrigated based on probe & farm practice Lucerne (irrigation 2)

120 100 80 60 40 20 0

NOV

DEC

JAN

FEB

MAR APR

MAY JUN

JUL

AUG SEPT OCT

NOV

This graph demonstrates the fluctuations in the growth rates of lucerne and rye-grass pastures between a dry summer (high water prices), winter and a wetter summer (low water prices).

Where there are breaks in the lines data was unavailable.

$122.28 TDM $46.01 TDM

This suggests that the irrigation management of lucerne can be more flexible, an advantage over rye-grasses where water availability and price is a concern.

The project has demonstrated the importance of developing a feedbase that works for your particular farm system. Farmers involved have a mix of feeds in their system,

using perennial and annual rye-grasses and cereals through winter and spring, and rye-grasses, tall fescue, lucerne and crops through the summer, adapting to seasonal conditions and their feed needs.

The economic analyses for the 2015–16 and 2016–17 periods highlight the impact of seasonal variation on the production and cost of pastures on one of the project’s partner farms. Farmers are increasingly looking to diversify their feedbase systems to stabi-

lise production and minimise risk.

Farmers involved in the Accelerating Change project have expressed an interest in looking at other alternative pastures to rye-grass. The project is currently measuring tall fescue and will finish in May. Project findings are published to the website, www. acceleratingchangeproject.com • Harriet Bawden is a team member of Murray Dairy.

The Automated Pasture Reader is attached to the front of a vehicle and driven across paddocks before and after grazing to measure pasture mass.

DAIRY NEWS AUSTRALIA MARCH 2018

30 // PASTURE IMPROVEMENT

Sharp pasture management achieves profitability ISSAC FYNN has been managing the South

West Dairies property in Ecklin South, Victoria for three years and is a firm believer that “sharp pasture management achieves profitability.”

Pasture Genetics’ Ansa Diploid Perennial Rye-grass has been used to help improve the 220 hectare farm that is 80 percent perennial and 20 percent annual rye-grasses.

Mr Fynn utilises Ansa Diploid Perennial Ryegrass paddocks that are one, two and three years old, and was initially surprised at how quickly the product establishes. Now, he sees this as one of the variety’s greatest benefits.

He said the established Ansa Diploid Perennial Rye-grass paddocks take the pressure off the farming system through the autumn, while the annual rye-grasses are getting going.

Depending on the season, Ansa Diploid Perennial Rye-grass can produce an extra two tonne per hectare of dry matter before winter hits.

Mr Fynn currently milks 465 Holstein cows, with a split calving of two-thirds starting in March, and the remaining third calving in September.

Recently, he decided to split the milking herd, in order to reduce the time that the cows

are off pasture during the milking process.

He said this has proven a good decision, as it has allowed him to allocate the most productive paddocks to the higher producing cows, and let the stale cows do some clean-up work through the less productive paddocks. This has also saved money on concentrates.

Ansa Diploid Perennial Rye-grass is a late flowering variety with very dense tiller production, and its excellent winter growth is a stand out trait.

Producing high quality feed during winter has saved time and money for South West Dairies.

“Looking after our perennial rye-grasses over summer is fundamental to their persistence,” Mr Fynn said.

“We must get to at least the two-leaf stage before paddocks are grazed.”

If the season runs out of puff, he keeps the cows out of the perennial rye-grasses and feeds silage on sacrifice paddocks.

Mr Fynn is confident that he will achieve five to seven years of productive pastures from his Ansa Diploid Perennial Rye-grass.

• Article supplied by Pasture Genetics.

Issac Fynn on his Ecklin South farm.

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MACHINERY & PRODUCTS // 31

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DAIRY NEWS AUSTRALIA MARCH 2018

32 // PASTURE IMPROVEMENT

Poor nodules restrict pasture quality JOHN FOWLER

TWENTY IRRIGATED sub-clover pastures from the Finley, Deniliquin and Mathoura areas were surveyed by Murray Local Land Services last year to evaluate their nodulation status.

The results were less than encouraging and indicated that better management practices are needed to ensure the best inoculum is successfully used when establishing new pastures.

the actual strain of Rhizobium present.

Soil samples were also taken from each site.

The survey was funded by the Australian Government National Landcare program.

Similar surveys have been completed by the Central Tableland, Central West, South East and Riverina Local Land Services.

The nodulation in local irrigated pastures was marginally better than that observed elsewhere in the state, but still less than adequate.

Number of Root Nodules

The tests indicate that it may be time to return to using slurry inoculates, in spite of the extra work required to do it correctly.

Of the 20 irrigated pastures sampled, only three averaged a nodulation score of ‘4’ (i.e. adequate), the remaining scored ‘3’ or less.

This was the first indication that local pastures are not performing as well as desirable.

Four sods were taken from each pasture to score them for nodulation, using a 0–8 scale where a score of ‘4’ is considered adequate.

Samples were then sent to a laboratory at Murdoch University in Western Australia to determine

Subclover is inoculated with ‘Group C’ rhizobium inoculant. The current Group C inoculum, released in 2006, has superior nitrogen fixing ability and better acid soil tolerance than the old Group C strain used until 2005.

Quality of Root Nodules

PREMIUM PASTURE BLENDS

Testing of irrigated sub-clover pastures in the Riverina showed better management practices are needed to ensure the best inoculum is successfully used when establishing new pastures.

Twelve of the pastures sampled were sown between 2010 and 2015 using pre-inoculated clover seed.

Therefore the current Group C rhizobium strain should be found in the sub clover nodules; however this was seldom the case.

Only 20 per cent of pastures established with pre-inoculated seed had the highly efficient, cur-

rent Group C rhizobium strain inoculating their roots, 40 per cent had the old, less-efficient Group C strain and the remaining 40 per cent had neither.

In other words, in 80 per cent of cases, nodules were formed by rhizobium species that were already in the soil and not by those applied to the inoculum coating on the seed. >>

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DAIRY NEWS AUSTRALIA MARCH 2018

PASTURE IMPROVEMENT // 33

FUNDING CALL TO INNOVATE AUSTRALIAN PASTURE SEEDS INDUSTRY Funding has been announced to develop new ideas to improve efficiency of sub-clover and medic seed harvesting.

The Pasture Seeds Program Advisery Panel, part of the AgriFutures Pasture Seeds R&D program, wants research proposals focused on the areas of mechanical development or improving

plant breeding, agronomic packages and soil management techniques postharvesting.

Program Manager, Dr Melanie Bradley, said the open call is a big opportunity to kick start innovation in the Australian pasture seeds industry.

“We haven’t seen broad scale industry

<< This indicates that while pre-inoculated seed can successfully inoculate pastures with the correct strain of rhizobium, more often than not it fails to do so.

There are several possible reasons for this, including using old seed or using seed that has not been stored correctly, rendering the rhizobium unviable.

A point of sale survey, conducted in 2005, of pre-inoculated seed in the eastern state wheat/ sheep belt found that only five per cent of the samples passed industry standard, in 60 per cent rhizobia was detected and in 40 per cent no rhizobia was found.

The number of rhizobia on pre-inoculated pasture seed products is highly variable and viability declines rapidly over time.

Some of the samples meet the rhizobia numerical standards when less than 50 days old (i.e. 50 days after inoculation) but virtually none of the samples older than 50 days, met industry standards (Source: GRDC Inoculating Legumes: A practical guide).

Rhizobium researchers have indicated that the most reliable way to inoculate pasture legume seed is to use peat inoculum.

Most irrigated pasture growers, however, have not used this technique for many years, opting instead for the convenience of pre-inoculated seed.

However, this local monitoring data indicates that it may be time to return to using slurry inoculates, in spite of the extra work required to do it correctly.

It needs to be stressed that these comments are based on a small sample size.

Only 12 pastures sown with pre-inoculated seed since the introduction of the new Group C rhizobium strain were tested.

However, the results from this small sample size are overwhelmingly poor and are consistent with sampling done elsewhere in NSW.

changes for harvesting medics and subclovers for some time,” Dr Bradley said.

“We’re seeking new and innovative ideas to create widespread industry impact.

“Pasture seeds harvesting can be a slow and expensive process, to grow the industry we need to create efficiencies, reduce costs and find new ways to protect top soil during the harvesting process.”

There are about 500 growers of temperate pasture seeds in Australia.

Latest figures (2013) show gross value

of production is $107 million, with about 70 per cent of this generated in export markets.

The AgriFutures Pasture Seeds program was put in place to grow the temperate pasture seeds industry through investment focused on improving seed production and processing efficiencies, promoting sustainability and developing pasture seeds markets.

For more information visit www. agrifutures.com.au/for-researchers/ pasture-seeds-open-call

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The soil test data from the 20 pastures was mostly favourable, although it did indicate some potential nutritional and chemical issues requiring attention.

Sulphur (S) was the main nutrient deficiency, which was surprising given that most of the pastures were fertilised with single superphosphate.

Six of the 20 sites were deficient in S, and a further seven were marginal for S. Phosphorus nutrition was mostly very good, with all samples being above 25 mg/kg (Colwell test) and 80 per cent above 35 mg/kg.

Three of the sites required liming to correct an acid soil issue (i.e. low pH), and six would benefit from a gypsum application to help with sodicity concerns (the gypsum would also address any sulphur deficiencies that may exist).

• John Fowler is an extension agronomist with Murray Local Land Services based in Deniliquin, NSW.

DAIRY NEWS AUSTRALIA MARCH 2018

34 // PASTURE IMPROVEMENT

Home-grown feed could prove best option this year FOR FARMERS who may traditionally buy

their feed from an external source rather than growing it on-farm, there’s one very good reason for a change this winter.

PGG Wrightson Seeds’ Product Development Manager, Allan Mudford, believes home-grown feed may be even more cost effective this year.

“Hot and dry weather conditions last spring and over summer across the country has seen a drop in the available amount of quality hay and silage,” Mr Mudford said.

“This lower supply also means higher current prices for hay and silage. The unfavourable conditions have also led to a marked drop in the average nutritional quality of available hay and silage.”

However, when it comes to implementing a successful home-grown pasture system, autumn is a particularly important time of the year — and making the right decisions now can significantly affect pasture production levels and livestock performance.

“Creating optimal home-grown feed supplies depends on a number of factors,” Mr Mudford said.

Tasmanian mixed farmer Robbie Toll, Cressy, in a paddock of Ascend annual rye-grass.

“Not least of which is the ability to choose the best varieties, in the right place, for greater long-term supply.”

To avoid the common problem of feed deficits, Mr Mudford said growers should consider the long-term goals of their pasture system.

“Careful planning, selection and preparation will give a much better feed production curve — so growers should consider everything from selecting the most fertile areas and choosing the right pasture to sow, to implementing good weed and pest management practices, and also considering the best seed preparation techniques.”

He said sowing rates was another area that can impact on success.

“Get your sowing rates right and you can improve early production without adding too much cost.

“An optimum sowing rate is crucial, as it leaves less room for weeds to establish, and creates a more sustainable pasture system.”

PGG Wrightson Seeds has recently a new annual rye-grass, Ascend.

“Ascend is ideal for farmers wanting to

Allan Mudford.

increase their home-grown winter pasture production from autumn into late spring, because it establishes early but matures late in the season,” Mr Mudford said.

“It jumps up very quickly, offering good winter growth and high rust resistance — and with its dense tillering, it fills out quickly, providing exceptional ground cover.

“This is the perfect choice for grazing or cutting for silage or hay later in the season — and with its improved dry matter production compared to most annuals, it also boosts weight gain, leading to increased productivity.”

Visit www.pggwrightsonseeds.com.au • Article supplied by PGG Wrightson Seeds.

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DAIRY NEWS AUSTRALIA MARCH 2018

PASTURE IMPROVEMENT // 35

Diploid rye-grass proves worth in Goulburn Valley PERENNIAL RYE-GRASS has come a long way since older varieties, such as Victorian perennial rye-grass.

New genetics are assisting growers in obtaining greater yields and improving quality.

Pasture Genetics’ Ansa Diploid Perennial Ryegrass, has been used successfully in the Goulburn Valley of Victoria, for almost five years now.

Pasture Genetics began trialling Ansa Diploid Perennial Rye-grass in 2011, to ensure it would meet the expectations of producers; and endure typical Australian climatic conditions.

Under irrigation and good management, many Ansa Diploid Perennial Rye-grass growers in the Valley have been seeing impressive results, not only with production, but also persistence.

Ansa Diploid Perennial Rye-grass was bred by the late Pedro Evans, in New Zealand, for DLF Seeds.

Pedro was based at the Department of Primary Industries in Hamilton, Victoria, for many years.

He knew what the Australian market was looking for in a perennial rye-grass.

Ansa Diploid Perennial Rye-grass was bred for its prolific tiller density and outstanding dry matter production, particularly through winter and early spring.

Tiller density in a grass is very important to producers who are looking to graze pastures, as it relates to the plants ability to recover from grazing; and its dry matter production.

The higher the tiller density, the better a grass plant will tolerate adverse conditions, such as heavy grazing in wet conditions.

The management of grazing is also a contributing factor to its success, not only with Ansa Diploid Perennial Rye-grass, but with all grasses.

Over-grazing will reduce energy reserves in a rye-grass plant and will thin out the pasture quicker than expected, impacting the persistence and viability of the paddock.

Grazing your paddocks too hard will also slow plant recovery and extend the rotation length to grow the same amount of feed. Leaving 1,500 to 1,800 kilograms per hectare of residual dry matter on pastures post-grazing, will assist in future production, persistence and recovery.

Diploids are also more tolerant of water or ‘wet feet’, when compared to tetraploids.

This is a bonus for Northern Victorian farmers, as majority of pastures are flood irrigated for at least eight months of the year. This results in difficulties in achieving perfect pasture management.

Research that was extended by Dairy Austra-

lia last year, showed yield results for perennial rye-grasses and expressed them by Forage Value Index (FVI). These figures were based on total dry matter yield only, the FVI found Ansa Diploid Perennial Rye-grass to be a proven performer all year round and to have great winter production.

• Article provided by Pasture Genetics.

Ansa perennial rye-grass showing high tiller density.

Sonik – rapid establishment and strong winter activity Take the worry out of winter feeding.

A four-year old paddock in Tatura.

Ansa Diploid Perennial Rye-grass exhibits finer leaves and stems than tetraploid ryegrasses. Diploid rye-grasses tend to have greater tiller density, and are more tolerant than tetraploid grasses to grazing, especially when it comes to over-grazing.

It can be difficult for producers to consistently manage pastures using correct management techniques, given seasonal conditions impact on feed production, feed availability and damage to pastures.

Diploid grasses have the capacity to better handle over-grazing than that of tetraploid grasses.

Sonik is the winter feed champion, with rapid establishment and strong growth rates over autumn, winter and spring providing the feed platform you need for great livestock performance.

Sonik is ideal for over-sowing into run-out or damaged pastures, rejuvenating paddocks or for full cultivation as short term (1-2 year) specialist pastures.

Sonik has excellent tiller density for higher yield, persistence and better ground cover.

For further information on Sonik, contact our regional agronomists: North & East Victoria, NSW, QLD: Adam Sheedy – 0428 132 096 Western Districts, SA, Tasmania: Bruce Hume – 0427 607 375

SONIK IS AVAILABLE FROM YOUR LOCAL SEED MERCHANT OR FARM MERCHANDISE OUTLET

Cropmark Seeds Australia Pty Ltd Freephone: 1800 889 039 Freefax: 1800 889 037 www.cropmark.com.au

DAIRY NEWS AUSTRALIA MARCH 2018

36 // MACHINERY & PRODUCTS

PFG unveils new Deutz-Fahr range PFG AUSTRALIA hosted a Deutz-Fahr con-

ference at their Derrimut, Victoria, headquarters last month where they unveiled the 6 series tractors, now available in Australia.

Dealers from around Australia inspected the machines and were able to board the new Agrotron 6215 RC-Shift for a test ride.

New Zealand sales manager Alistair Horrocks was in the driver’s seat. The Series 6 tractors are already available in New Zealand and Mr Horrocks said they have proven popu-

lar with dairy contractors.

"It’s used for baling and tillage work, but it’s also a good haulage tractor," he said.

The machines released in Australia don’t have the emission controls required in Europe, making maintenance easier.

The Agrotron 6215 RC-Shift featured the updated Series 2 ‘maxivision’ cabin, which is separated from the engine itself, providing a comfortable and quiet ride with a decibel reading around 67dB.

The Deutz 6215 RC-Shift at work with the Quicke loader.

The 215 hp 6215 RC-Shift is the highest horsepower variant in the range, which starts with a 155 hp model.

The RC-Shift transmission makes gear shifts as easy as pushing up or down on the joystick.

It has a manual five-range gearbox, but has full automation built in.

Mr Horrocks said the level of automation in the new RC-shift tractors enables it to drive and operate like a TTV but gives the operator the option of having an automated tractor with a

manual gearbox."

The 6215’s controls and buttons are all colour coded — orange for transmission/engine; yellow for PTO, green for hitch and blue for hydraulics.

PFG Australia Ag Division product manager Anthony Daveniza said dealers at the Conference were all impressed with the new 6 Series.

Visit www.pfgaustralia.com.au/dealers to find your local dealer.

The Deutz 6215 RC-Shift can travel at up to 40km/hr.

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DAIRY NEWS AUSTRALIA MARCH 2018

MACHINERY & PRODUCTS // 37

PFG Australia Ag Division product manager Anthony Daveniza with the Deutz-Fahr range at last month’s field day.

The Deutz-Fahr range has models and specifications to meet all needs.

Quicke Asia Pacific regional manager Mathew Harris.

Australian dealers giving the new range the once over.

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DAIRY NEWS AUSTRALIA MARCH 2018

38 // MACHINERY & PRODUCTS

Mower choice crucial in drive for high quality feed BALING UP a field of hay isn’t going to guar-

antee quality hay and silage.

The right equipment is becoming increasingly important to maximising hay and silage quality,

according to Kuhn National Sales Manager, Jarrod Maskell.

“With fodder quality varying greatly, depending on everything from moisture content and particle

size to packing density and sealing practices, the number of variables makes it important to invest in the right equipment,” he said.

Mr Maskell said there were key considerations

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“Crop selection is key so look at the type of crop you’re using, to ensure it performs well in your climate, so you get the best possible nutritional value.

“Water management and soil condition, whether it’s heavy, dry or rocky, will also affect the type of moisture content your crop has access to.

“Plant nutrition is obviously also another factor that will affect the overall quality. And finally, the type of equipment used will have a considerable impact on the final result.”

Mr Maskell said a regular mower will simply cut the crop, which is fine in some conditions — but it can lead to a longer drying time.

“If conditions are wet, this can create issues with mould and that’s when a disc mower conditioner can be invaluable.

“Using a pair of rubber or steel rollers that the fodder passes through or a flail roller with steel fingers that crimp the fodder in the rollers, or bruise the stems with the steel fingers, enable fodder to dry faster and more evenly. “ Mr Maskell said it was important to reduce dry-down time.

“Particularly with larger farms, it’s important to reduce that dry down time, due to harvest constraints. Dry down is a lot faster and more even with a conditioner, and it means better quality in hay and silage feed tests.”

Kuhn offers various disc mowers that have been designed specifically with a top-quality end product in mind — including the FC 10 030 D and FC 3525 DF FF Triple Mower Conditioner Combination.

“This machine combination is not only better able to handle all types of fodder, but its greater speed and coverage creates higher volume, which is ideal for mass production.

“This particular machine adapts perfectly to different types of terrain, preventing contamination by impurities and preserving plant cover, for better nutritional quality and higher quality forage.”

In addition, machines like the GMD 10 030 FF and GMD 3525 FF Triple Mower Combination with a working width of 9.53 to 9.93 m, achieve exceptional work output, he said.

“This combination features OPTIDISC cutter bar reliability and PROTECTADRIVE safety, for greater productivity, as well as a time-saving FAST-FIT quick knife attachment system.”

To celebrate Kuhn’s 50 year anniversary, the company is giving away a special edition GMD 310.

The special-edition machine will be on display for visitors at the Farm World Field Days in Lardner, Victoria from April 12 — 15 April.

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The Kuhn 10 030 DTriple Gang Mower and Conditioner.

*Thissaving savingisisequal equaltoto $10 each *This $10 forfor each the140 140years! years!This Thisoffer offer valid ofofthe is is valid onlyininAustralia Australiaand andNew New Zealand only Zealand forthe a limited time. till end of 2017.

With more than 4000 SKIOLD SKIOLD Disc DiscMills Mills than 4000 25million million running worldwide producing producing 25 MILL feed every SKIOLDDISC DISCMILL tonnes of feed every year. year.SKIOLD its eďŹ&#x20AC;ectiveness has proven its eďŹ&#x20AC;ectiveness in in feed feedmilling! milling!

The NEW Benchmark in Calf Milk Replacers

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