by Dr Richard Kirkland,
Global Technical Manager, Volac Wilmar Feed Ingredients
AUSTRALIA hit the head-lines over recent months for all the wrong reasons thanks to some of the worst bushfires in history across an already drought-stricken landscape.
No surprise then that Australian dairy farmers have been under severe pressure over the past few years with significant effects on the industry.
Impact that was all to obvious when I recently visited Australia and New Zealand for Volac Wilmar, a joint venture between UK based and family-owned nutrition company Volac International and Singapore-based vegetable oil processor Wilmar International.
At Volac Wilmar we are highly-active in these overseas markets, providing nutritional advice and
solutions to individual farm bus-inesses, with particular emphasis on fat, or more-correctly fatty acid nutrition.
Dairying predominates in the south-east corner of Australia but the absence of greenery in the entire region from Sydney through to Melbourne is striking, while lack of available water has already caused a sizeable decrease in herd size in northern Victoria.
In contrast, travelling east of Melbourne through Gippsland leads to very different scenery where the rolling hills have more than a tinge of green and farmers have had a reasonable and less-challenging year than other regions of the country.
Water is king in Australia and with the added pressures on availability this season it’s no surprise that prices have increased by up to 200 per cent in some areas. While milk prices have increased, averaging 7.00 AUD per kg milk solids for the 2018/19 season, up 25 per cent from the previous season, feed prices have increased by over 30 per cent in the same period on top of the higher water charges.
Total farm numbers declined by nearly nine per cent between 2017/18 and 2018/19 to 5,213, and a further fall to around 5,000 herds is projected in 2020. Unlike the scenario we have seen in many European countries, the decline in farm numbers has also been accompanied by a reduction in Australian milk production of close to one billion litres to under 8.5 billion litres plus a seven per cent fall in cow numbers to just over 1.4 million head.
Production systems vary greatly in Australia; from high-grazing set-ups, to feedlots, to completely-enclosed systems, and diversifying to non-‘standard’ milk has been an option taken by some. Several dairies have specialised particularly in production of A2 milk, a niche from the ‘typical’ A1 genotype.
Across the Tasman Sea, the New Zealanders are also in the midst of their summer and with the exception of areas under irrigation, there isn’t a great deal of green vegetation around. Milk price has seen a significant increase in the current season, averaging 7.30 NZD per kg milk solids (milk at standard composition), compared to 6.40 NZD in the previous year and 6.78 NZD prior to that.
However, despite these increases, farmers remain under considerable financial pressure with banks reducing risks by requiring cap-ital repayment rather than the traditional interest-only loan option on land.
Meanwhile land values have also taken a significant hit due to government policy changes aimed at preventing foreign investment in NZ houses and land. The resulting squeeze on cash has had consequences in reducing necessary feed supplementation and general farm investment.
It is estimated that only around 15 per cent of Kiwi herds now operate a grass/home-grown forage-only
system, with the drive to get more solids per cow and per hectare resulting in increased use of bought-in supplements, in particular palm kernel. A typical target for these grass-based herds is to achieve a solids yield per lactation equal to cow bodyweight and in common with many other markets, fat is particularly valuable in most contracts.
The challenge to maintain a tight calving pattern is high in these seasonal systems with typical six-week service periods necessitating very high proportions of preg-nancies and well-under 10 per cent empty rates at the end of the restricted service period essential.
Fatty acids can play a key nutritional role in achieving these objectives, with Volac Wilmar providing the high-C16 supplements targeted to improve milk fat production and the coarse-grained calcium salt options delivering oleic acid (C18:1) through the rumen targeted to improve body condition score and fertility.
Environmental regulations also impact, with particular emphasis on production of methane at farm level, a greenhouse gas that along with other agricultural emissions NZ farmers may be audited on and levied come 2025 based on current proposals.
The contrast of summer ‘Down Under’ and the UK winter couldn’t be much starker, but it does emphasise the importance of the one key element we often take for granted – water. While the sunny climate down under is without doubt very pleasant, it presents a whole different set of challenges not encountered here in the UK and without sufficient availability of water, dairying simply isn’t feasible.
When’s the next shower? – it’s probably already here!
Exchange rates March 2020 £1GBP = approx 2AUD or 2NZD