Get started in dairying and make a good living with a modest-sized herd by keeping costs low.
By Dave Forgey, Logansport, Ind., firstname.lastname@example.org
The KISS principle ("Keep It Simple, Stupid") applies to rotational grazing as well as it does to other areas of life. With grazing, it involves doing things that don't cost much money or take much time, but which increase your net returns.
This has been one of my greatest challenges. I have always been a gadget person. I would always go for any idea which would save me time, and I always fell for the sales pitch that all these gadgets increased my profit by cutting my labor expenses. In fact, over the years I've probably bought enough gadgets to reduce my labor by over 200 percent. But my expenses just went up and I was still working as hard as ever. I think most of us fall into the same trap, and we just have to do more to pay for the labor saving devices.
Even after changing to our low-cost system, I have to watch myself or I spend money for things I don't really need. The first fencing salesman I talked too told me I needed a $40 reel to roll up polywire. So I bought one. Since then, I have been buying extension cord reels at the local hardware for less than $5. Even my first fences had more wires than I needed. I've found that after proper training, one-wire interior and two-wire perimeter fences do quite well for controlling most cattle.
The same goes for the plants we grow for pasture. Many times you can pay four to five times as much for extravagant seeds which don't produce any more feed than a simple orchard grass/clover pasture. Don't get me wrong, an additional seed expense of $15 to $20 dollars per acre can easily be recovered if the dry matter yield only increases by a few hundred pounds per year. Many times this doesn't happen unless we change our management or fertility system, and this increases our cost of production.
If we're going to be early-adopters of these grazing ideas, we have to do the research to document our cost-savings for each change. Otherwise we only know at the end of the year that we have more profit, but we don't know where it came from. Sooner or later the research facilities will catch up with us and start doing economic analyses on many of these grazing ideas. Then we can use their research to fine-tune our operations.
It's a well known fact that our prices for milk, meat or grain haven't risen much in the last 10 years. But the services and equipment we purchase to raise these products have gone up dramatically. Getting bigger and more efficient only goes so far in spreading the costs over more units of production, and we usually have to work harder to earn the same or less return.
At a recent winter meeting, I heard a university economist talk about his prediction for the future of the dairy business in this country. He felt that for confinement dairies to be economically viable, they needed to milk 500 to 1,000 cows each. Producers would need 60-percent equity going into the operation. Then they would hire labor for $6 per hour and at the end of the year net $300 per cow.
If you don't compare that to anything it sounds like a good annual profit. But I have talked to many graziers who keep it simple and who are netting nearly $1,000 per cow on moderate-sized farms without the hassle of managing large numbers of employees or cows.
If that mega-dairy is the future of the dairy industry, then there is little chance for the young people of this country to ever be anything but employees on such operations. I believe that with the right opportunity, young people who can open their minds to the new concepts behind rotational grazing and seasonal dairying could be operating on their own within 5 to 10 years after starting in this system
Just keep it simple.
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