Droughts and the Cost of ProductionMonday, Mar 26, 2001
It is an unfair twist of the weather to present a late season drought at the end of the best-priced
season for most pastoral farmers.
Mid Season droughts for dairy producers give some justification to feeding higher cost feeds to bridge
the gap with the expectation of recovering some production from autumn grass growth in the tail
of the season.
This years February – March going on April dry does not give that luxury. For most of central
NZ there is less than sixty days of the season left and even if significant rain arrived this week
it would be 20 April before it made an impact on pasture cover. Barely time to get stock adjusted
to softer feed and maintain condition. Indicating that if there is no possibility of early rain,
drying early off may be the most economical way of finishing the season
Low cost milk production can in times of drought have a high price when sorting out the present and
future costs and benefits of feeds more expensive than the normal seasonal cost of pasture.
The higher product prices paid this year and the added implications of potential share allocations based
on this season will be pushing some farmers to keep on supplementing well past a sensible point.
NZ dairy farmers pride themselves on the skills and judgment they have for managing low cost production
but there are still efficiency gains to be made from knowing the cost of the feed fed against
the returns gained. This is a complex sum when run over a full seasons growth and a full seasons production
but it is never the less a sum that should be figured out.
Researchers have shied away from quantification of the seasonable variability of the cost of pasture
production and its allocation for best return. Our Aussie neighbors may be gaining an edge on us
in this area because of the nature of their grass production, the predominance of irrigation and the
availability of low cost cereals giving a stable strategic mix of inputs that can be predicted
Dairying in particular, but infact, all NZ pastoral farming has to face up to the reality of the finite
pasture production resource inherent in each farm. Accepting this limit and managing low cost
feed with strategic supplementation will become a much more exacting management demand in the future.