Describing the composition of Clayton Alley’s dairy herd is no easy job, with the herd comprising a diverse mix of crossbred cows that are one of the keys to the high profitability of his business.
Who: Clayton and Kristy Alley, Moo Moo Dairies – X-breds for profit, Riverie
What: 175 milking cows, crossbreds
Where: Forbes, NSW
“To give you an exact break-up of what we have would be almost impossible – it’s just an explosion of breeds, basically,” said Clayton, a Dairy Farmers Milk Co-operative (DFMC) member whose farm lies along the Lachlan River just outside Forbes in NSW. “We have crosses of Holstein, Jersey, Friesian, Ayrshire, Aussie Red, Fleckvieh, Normande and Brown Swiss – it’s a complete crossbred herd.”
Clayton milks about 175 cows at Moo Moo Dairies – X-breds for profit, Riverie, and walking with him among his herd it is astounding how much knowledge he retains in his head about each cow’s parental linage.
To manage the crossbreeding, Clayton buys in unrelated bulls and runs them with the herd for two years – until the bull’s heifers start to come online. He doesn’t use artificial insemination (AI) because he feels he has more success with the herd bulls – about one bull to every 50 cows – and gets healthier calves.
“It probably all started for me years ago with my grandfather,” said Clayton. “He’d always say to us ‘The best cow in the herd is a brindle’, which is often a three-way-cross cow with a red cow, a Jersey and a Friesian.”
The driving force for his crossbreeding endeavours isn’t just to produce a pretty-looking brindle cow (although he clearly appreciates a looker!) – it’s all about profitability.
“You know there’s two sorts of dairy guys out there,” said Clayton. “If you’re going to be a status guy you’ll milk the big Holsteins with big numbers. If you’re more about your components, you’ll milk Jerseys with lower numbers but higher components. But I like a mixture of the two where you make money; it’s all about the bottom-line profit.”
And something must be going right, because Clayton estimates his profits are more than double those of the average dairy farm, based on industry benchmarks.
Lower inputs, lower costs
“We attribute our success to very, very low inputs. We also don’t spray anything, we don’t fertilise anything and we use our effluent water a bit,” Clayton said.
He’s also saved about $30,000 a year by cutting out a lot of mineral additives and instead feeds his cows about five kilos of pellets a day combined with strip grazing. The transition to the new feeding program was slow, with Clayton gradually shifting his cows across and closely observing changes along the way. Interestingly, he has observed that the cows seem to now eat less and ruminate more.
“We worked on our soil as well as our cows so that the cows were getting a more natural availability of minerals and vitamins and everything out of the grass instead of trying to force-feed it into them,” he said. “We try to give them as much grass as we can, and it’s a mixed pasture.”
His philosophy is to give the cows a good range of pasture varieties to choose from so they can select what they need. He prefers direct drilling and avoids too much ploughing but says it was not a quick process to establish the pastures to the point at which they are now. But six years after the change-over, Clayton is pleased with the results.
Data from soil tests done on the farm show no deterioration of soil minerals and in fact an increase of five per cent after two years of using some effluent waste from the dairy to restock nutrients and no manufactured fertilisers.
“Minerals in the soil translate to minerals available in the grass that the cows are getting,” said Clayton. “We don’t need to feed as much because they’re filling their mineral requirements a lot quicker and sooner.
“You don’t need to plough because it’s working itself. And you don’t need to spray. The only thing you need to do is slash. It’s labour-effective. It’s cost-effective. And it’s a lot cheaper to feed cows on grass that it is anything else.”
Happier, healthier cows
Clayton also attributes his farm management to achieving happier and healthier cows – with no occurrences of mastitis in nine or 10 years.
“If they’re going to be good strong healthy cows then that’s what we want, because to us the cow’s health is really important,” said Clayton. “All I look for in a cow is that she’s going to be able to milk – good strong robust cow, a healthy cow – then the rest of it sort of takes care of itself.”
These are the traits Clayton has achieved through his crossbred herd. His wife Kristy adds: “The cows themselves are easier to handle. They are smaller and more compact, and they have better temperaments, I think.”
Another benefit of the crossbreds is that they are more suited to dual purpose because they’re a bit “beefier”, says Clayton.
“We’ve always got buyers for our bobby calves,” he said. “People want them to grow on for 12 months or so.”
And he points out that if ever the dairy industry moves to require calves to be aged 90 days or more before slaughter then his business is pretty much already set up for that, given the demand for his crossbred calves.
Less litres, more profit
With an annual production rate of around one million litres a year, Clayton’s crossbred cows average between 17 and 18 litres a cow per day.
“We’re not getting the litres that we were getting before but we’re not spending the same amount of money either,” Clayton said. “But as far as our profitability goes, we’re probably one of the best in the industry.
“I know that’s a pretty big call and a big statement to say but given the fact we’re involved with that milk monitor project, we have a good idea of where we are at.
“Regardless of what the milk price is, we try to retain better than 50 per cent. So, if we’re getting 50 cents a litre we try to make a profit of 25 cents a litre.”
He adds that, for small-scale farmers like him, DFMC’s collective bargaining power has been a real positive.
“It’s a farmer in there arguing about milk prices because he has the same issues you have, and it’s not a company coming out and saying ‘Well, okay, you’re going to practise this, this, this and this’,” said Clayton. “It’s a group of farmers fighting for farmers, which is why we stay.”
In the midst of the Senate and Australian Competition and Consumer Commission (ACCC) dairy inquiries, one dairy co-operative is demonstrating how an effective collective bargaining group can provide benefits to both dairy farmers and processors.
Dairy Farmers Milk Co-operative (DFMC) is a farmer-owned co-operative comprising more than 350 members across Queensland, New South Wales, Victoria and South Australia.
“Together we supply over 270 million litres of milk every year to Lion Dairy & Drinks in a long-term partnership that provides a quality product to Lion and security to our members,” says DFMC Chair and Queensland dairy farmer Duncan McInnes.
“What sets DFMC apart from other co-operatives or collective bargaining groups is that our current Milk Supply Agreement with Lion stipulates that if we have a dispute on price, either party can request it be resolved by an independent arbitrator and we are bound to abide by that independent decision.
“This helps to balance the power differences between the two, strengthens the co-operative and gets fairer results for farmers.”
These outcomes reflect the recent Senate dairy inquiry report that recommended a strengthening of support for dairy co-operatives and a reduction in power imbalances between farmers and processors.
DFMC made two submissions to the ACCC dairy inquiry, which is due to report its findings later this year.
“In our submissions to the ACCC dairy inquiry we highlighted the co-operative model we have at DFMC as one that has proven effective and beneficial,” said Duncan. “We also emphasized the need for more transparent and competitive milk pricing and contracting.
“At the end of the day, we just want to keep producing milk and stay in business. We are committed to our industry and with the right support we can keep producing milk at a fair price for all Australians to enjoy.”
DFMC farmers supply Lion’s dairy brands including ‘Dairy Farmers’ and ‘Pura’, and flavoured milks including ‘Dare’, ‘Farmers Union’, ‘Big M’ and ‘Moove’.
Sophie Clayton, Currie Communications: 0478 029 048 | email@example.com
As part of its work to support the development of excellence in young dairy farmers, Dairy Farmers Milk Co-operative helped sponsor the Young Dairy Network’s tour of New Zealand in June 2017.
Around 28 young Australian dairy farmers ranging in age from 18 to their early 30s attended the tour including Assistant Dairy Herd Manager Georgia Sherborne who works on her family dairy in the Southern Highlands region south of Sydney in NSW. The family are members of DFMC.
For Georgia, one of the standouts from the trip that took them to eight dairy farms across New Zealand as well as to research and other dairy hubs, was the visit to Philmara Farm. Located on the North Island just a few hours south of Auckland, Philmara is owned by Philip and Maree White with their son Mike moving back to the dairy to help manage it after five years in rural banking.
“Philmara was interesting because they have some good lessons around succession planning that made a lot of sense,” explains Georgia. “Mike is a young farmer whose background in rural banking has also given him a lot of useful and different knowledge and experience that he brings to the dairy business.”
After starting work on the dairy after completing school, Georgia, 22, now says she might be interested in studying some financial business management.
Other aspects of the trip highlighted the differences between the Sherborne’s dairy, which comprises 270-300 milking cows, mostly Holstien, and the typical New Zealand dairies they saw.
“In New Zealand it seems they want to produce as much of their own feed as they can themselves – some wouldn’t buy anything in, and they are seasonal,” says Georgia. “For us, and for many dairy farmers here, we calve all year round, and we do in-shed feeding and have a feed pad.
“They keep their dairies basic, but I’m actually pretty excited about some of the new technology that is coming – especially around animal health.”
Georgia says the trip was amazing and that she loved every minute of it – some encouraging feedback from the next generation of dairy farmers learning how they can step up to lead the industry into the future.
The Young Dairy Network tour of New Zealand was managed by DairyTas and DairyNSW Young Dairy Network and ran from 18 to 26 June.
The bustling, busy house of Queensland-based DFMC dairy farmers Duncan and Mary McInnes reflects the energy and enthusiasm the entire family has for the dairy industry.
Who: McInnes Bros Trust – Duncan, Ross and Morris and their families
(In photo from lt to rt: Duncan McInnes, Ruth and Geoffrey Chalk’s son, Mary McInnes, Ruth Chalk, Ross McInnes)
What: 500 milking cows, mostly Fresians, on partial mixed ration
Where: Radford, Queensland
The three brothers of McInnes Bros Trust – Duncan, Ross and Morris – all work in the business and have various community commitments that occupy their time as well. Their Scottish grandparents John and Elizabeth McInnes started the dairy more than 100 years ago and the legacy looks likely to continue with some members of the third generation dairying as well.
They employ four full-time and four part-time staff including Morris’s son, Jason, and Ross’s daughter, Madeline. Morris’s wife Monica is also involved in the business, milking on a regular basis along with Mary looking after the bookwork. Duncan and Mary’s daughter Ruth Chalk also works in the industry for a joint Queensland dairy initiative in NRM – Dairying Better ‘n Better – and operates a dairy with her husband Geoffrey and his parents, John and Carol.
The McInnes Bros Trust doesn’t own land in its own right but leases land, including from family members, to run around 500 cows – mostly Friesians – on a partial mixed ration. Nestled in the Scenic Rim region of south-east Queensland with a view of the Great Dividing Range, the dairy produces around 4 million litres of milk a year.
“There is a future in dairying around there,” says Duncan. “Most consumers want to buy milk from the local area and we’re an hour out of Brisbane so we’re well positioned to supply it.”
The McInnes family is one of 50 DFMC members in south-east Queensland who, together, produce around 20 per cent of local production. All their milk goes to Brisbane, yet there’s still a gap in the market with sometimes up to 10 per cent of white fresh milk being imported from interstate.
“We should be able to be more competitive than bringing milk from Victoria or elsewhere even though the cost of production is dearer here. But at the moment we haven’t got enough milk to fill the bottles here,” says Duncan.
And it’s this opportunity for growth that gets Duncan excited.
“There is growth and opportunities here in Queensland and especially in south-east Queensland – it’s great for young farmers,” he adds. “We’re getting paid reasonably well. Of course, we’d always like to think there is a bit more to be had, but given the present situation with one dollar a litre milk we can’t expect to be getting much more than we are getting now.
“You can either grow by getting higher prices or you can grow by producing more volume. Many of our farmers have been able to grow for the last three to four years and we’re looking for every litre of milk that we can get hold of from them.”
Looking after farmers
Since DFMC’s inception in 2004, Duncan has been a director and is currently Chair. Previously, since 1982, he was director on the local co-operative that – after five mergers – became part of Dairy Farmers. When Dairy Farmers sold the processing arm, DFMC was born.
“All the other co-operatives were processors,” he explains. “DFMC is a different beast, we’re just a collective bargaining group. But at the end of the day we are always trying to look after farmers and deal with farmer issues.
“Any collective bargaining group gives you the assurance that someone is doing that work on your behalf and in a professional manner. Although everyone should realise that the market will go up and down a bit to some degree.”
Focusing on supporting the industry at large and other dairy farmers seems key to Duncan’s approach. Their farm is relatively large but they still say they would not want to be negotiating one on one with a processor.
Mary sums it up nicely.
“It’s harder for smaller dairy farmers, we’ve got size by having three families that farm together and we produce four million litres,” says Mary. “But we prefer to be within the co-operative and in that collective group so we can all share in that ability to get the best price.
“The co-operative offers us security and strength in numbers. Individual farmers may not be very good at bargaining in their own right, but together we can be stronger.”
Sustainable prices, sustainable business
Duncan is also a vocal advocate encouraging consumers to purchase branded milk.
“Selling milk at one dollar a litre – well, you’re never going to make too much money – for the processor or the farmer,” says Duncan.
And, as dairy farmers will be aware, it’s one thing for a processor to make a business decision not to make a profit on their milk when they may have other income streams or reasons for setting up their business that way. But for farmers it does make a difference, particularly for the long-term viability of their business.
Ross explains, “There are farmers who are not reinvesting in their farms– that’s probably the problem that we have. If the price isn’t high enough, the first thing that doesn’t get done is reinvestment on the farm.
“I have just done some rough numbers here and we need to reinvest 3 or 4 cents per litre of milk produced every year just to purchase new tractors, machinery and irrigation that we need. If we don’t reinvest in our capital, our maintenance goes up.”
And while it is key to prioritise farm investment in the ‘basics’ the family are also well aware of the need to step away from the business to assess their own performance and look for better ways to fundamentally do business.
They use QDAS (Queensland Dairy Accounting Scheme) and DairyBase to benchmark their business and spend time talking to other farmers to share ideas to improve their practices. For Ross, the promise of new technology is also a big opportunity for the industry and as a pathway to a better business.
“Breeding to produce animals that last longer and whose structural faults are corrected, that can give you a lot of satisfaction if you can improve the quality of your cattle,” says Ross. “Or when you a put in place a nutrition program that increases your productivity. Plus there are mobile phone apps that help you out and the prospect of virtual fencing.”
Both Ross and his niece Ruth talk about the opportunity for cow collars to monitor cow health that pick up on issues the cow might be having before they become a problem. Yet the challenge to adopt new technologies lies in understanding their costs and benefits and making sure they are road tested first to reduce risks.
“It comes back to weighing up the costs and benefits of all these things,” says Ruth. “There are some very successful people out there that are investing at the right times, in infrastructure and equipment which provides great paybacks. I think you’d pay back a lot of this quite quickly but you have to have access to the capital, the cashflow to support it, and the confidence in the future of your business and the industry.”
The McInnes are investing in and trying new practices and infrastructure themselves too. They have installed a new calving shed to better bring on the calves in the healthiest environment possible and a new glycol chiller for their milk. They are also feeding brewer’s grain – a byproduct from beer making that they source from Lion. It is very high in protein and moisture and is a good supplement for their cows.
“I think there are going to be some really cool advances in dairy technology that are going to become more affordable over the next three years,” says Ruth. “We definitely need to be more positive about our industry and its prospects, we are the only ones that can change that. ”
“Dairy is still seen by the majority of the community as a food with high nutritional benefits and people still want to have fresh milk, which means that there is still a market for us to produce milk here. And, off the back of that, they still want to see their farmers to be paid a reasonable price.”
DFMC’s Ward Representative Advisory Council (WRAC) met in June to discuss key issues and share regional updates.
The WRAC is a consultative panel, currently made up of twelve DFMC members. They act as a sounding board to help drive the co-operative forward.
Among their duties, they meet at workshops twice a year to consider issues on policy and strategy presented to them by the DFMC Board. Additionally, they consult with the Board on regional issues and ideas from members throughout the year.
This two-way, consultative approach underscores a key foundation of the co-operative.
The mid-year workshop was held in late June in Brisbane with Directors joining the WRAC for two busy half day sessions starting with a regional updates with each being asked to address key issues such as the seasonal outlook, current farm input prices (i.e. grain, electricity, water, fertiliser and labour prices), major constraints their region is facing that limits on-farm investment, and competitor activity. Given the diversity of each of the regions there were fascinating insights for all.
The WRAC then had a session together to bring together issues they would like to raise with the Directors. Communication and Board composition as well as WRAC involvement in the AGM were raised. The chair of each of the Board committees then gave updates on key issues addressed at Board level in recent months. Andrew Burnett, chair of the pricing and policy committee, sought WRAC feedback on a few milk policy changes that are being discussed with Lion and reminded participants of changes previously agreed for implementation in the 2017/18 season.
All major elements, together with pricing, will be covered in the mid-year supplier meetings that have commenced with South Australia and Far North Queensland meetings already held.
The night sandwiched between the two half day sessions started with teams competing in lawn bowls and then a BBQ dinner at The Boo, a historic local bowls club.
A very enlightening and thought provoking final session presented by Sarah Green from the NSW Rural Adversity Mental Health Program had everyone very engaged.
Congratulations to all the winners of the 2017 DFMC photo competition!
And a big thank you to everyone else who submitted entries and shared their photo across social media #welovedairyphotos
The winners are:
- People of DFMC: Kylie Hayes for her photo “That time again”.
- Valuing the Environment: Donna Nelson for her photo “Taking the cows to paddock”.
- Dairy Landscapes: Samantha Gee for her photo “Afternoon bailing hay”.
- DFMC Junior: Jessica Hayes for her photo “Nosie the cow”.
- Caring for cows: Deanne Hore for her photo “Feeding time”.
- Love our Brands: no winner awarded for this category.
DFMC 2017 photo competition entry guidelines
DFMC is providing an opportunity for our members to show off their photography skills and promote our dairy farmers as being among the best in the country. To do this we’re holding a photo competition where members (and their immediate families and staff) will get a chance to win prizes and have their photos published on our website and shared across our social media pages.
Members of DFMC including their current employees and immediate family (spouse and children) are eligible to enter the competition.
This competition will run from 1 May to 16 June 2017, with final submissions accepted up until midnight on Friday 16 June. Late entries will not be accepted. Winners will be announced on 28 June 2017.
1. People of DFMC
Photos of people, such as yourself, your family, your peers and other people involved in dairy.
2. Valuing the environment
Photos that include activities that help the environment.
3. Dairy landscapes
Photos of the dairy landscape including farms, fields and farm animals.
4. DFMC junior members
Photos taken by our youngest members. Only photos of those under 18 are accepted.
5. Caring for cows
Photos that show how the welfare of dairy cows is supported by members.
6. Love our brands
Photos that show how much members love Lion dairy products and brands.
Winners and prizes
After you submit your photo please share it across your own social media platforms including Facebook and Twitter and tag Dairy Farmers Milk Co-operative (@DFMilkCoOp) and use the hashtag #welovedairyphotos – how much attention your photo gets on social media will influence the judges.
A panel of judges – the DFMC Board Communications Sub-Committee – will determine the winners of each category. There will be one winner in each category. The judges’ decision will be final. Winners will be announced in a live video update on DFMC’s Facebook page at 3pm on Wednesday 28 June 2017 and informed via email. Winners’ names and photos will be published on the DFMC website and shared across DFMC’s Facebook and Twitter pages.
The winning photographer in each category will have a chance to have their photos professionally printed with our prize of a $100 gift voucher for each category.
Conditions of entry
- Only members of DFMC are eligible, including their immediate family (spouse and children) and staff employed in their business. Those who are not members of DFMC are not eligible to enter.
- Images must:
- Be original – people submitting a photo must have taken the photo themselves.
- Be taken between 1 January 2016 and 16 Jun 2017.
- Be in their original form – this includes original meta data (such as location details), and size.
- Be unedited (cropping is an exception).
- Be a maximum file size of 10MB.
- Have a width or height (whichever is the shorter) of at least 3,000 pixels.
- Images must not:
- Violate or infringe upon another person’s rights, including but not limited to copyright.
- Contain sexually explicit, nude, obscene, violent or other objectionable or inappropriate content.
- Involve putting any individual or animal in danger.
- It is the responsibility of the submitter to ensure that permission has been given by all people featured in the photograph for DFMC to use and publish the photographs in which they appear.
- Upon submitting images to DFMC, all submitters give DFMC a royalty-free, perpetual, non-exclusive right to use the images, in good faith, in any form as they see fit.
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