- The impact on profitability of switching to OAD depends on multiple factors.
- Farms that can achieve a lower reduction in milk production, or which have a greater ability to reduce costs, are more likely to maintain profitability.
- Prepare a budget incorporating the likely farm system changes and evaluate the result, bearing in mind the intangible benefits.
Two approaches can be used to reduce time spent milking on-farm. Within a milking, options include milking to a fixed time (MaxT), cupping skills and optimising machine settings. The other approach is to reduce milking frequency – milking cows once a day (OAD) or three times in two days (3-in-2) – which is the focus of this article.
DairyNZ survey data from 500 dairy farms in 2018/19 indicated that 33 percent of farms milked OAD for part of the season, eight percent milked OAD for the whole season and 12 percent used 3-in-2 for at least part of the season – leaving 47 percent of farms milking twice a day (TAD) for the whole season.
Examining full-season OAD
In the last few seasons, interest has grown significantly in milking full-season OAD, with a farmer interview on the topic being our fourth-most-watched video. In response, we’ve drilled into the numbers to gain a better understanding of the system impact of full-season OAD.
We used data from the Dairy Industry Good Animal Database to compare 302 herds milking full-season OAD with a control group of geographically similar herds milking TAD. Key results were OAD herds had:
- a five percent higher 3-week calving rate (59 v 64 percent)
- a five percent higher 6-week in-calf rate (60 v 65 percent)
- an 11 percent decrease in milksolids on average, dependent on the pre-OAD level of production:
- Herds producing 300 kilograms of milksolids per cow (kgMS/cow) or less had a small or no decrease (25 percent of the national herd fit into this category in 2017/18).
- Herds producing more than 400kg MS/cow had a greater decrease.
Our conclusion was that full-season OAD could be equally as profitable as TAD if costs are reduced by as much as the reduction in milk revenue (lost milk production multiplied by the long-term milk price). See the December 2017 issue of Technical Series for more information.
Impact on profitability
Next, we used DairyBase data to determine if the OAD farms had achieved this cost reduction. Unfortunately, the small number of full-season OAD herds in DairyBase makes the analysis challenging. On average, the OAD herds had a 15 percent decrease in MS/ha and their profitability reduced, as their costs per hectare remained similar to the TAD farms.
We anticipated that labour efficiency (cows per full-time equivalent worker) would be higher with OAD – but it was not. To investigate this further, we grouped 33 of the OAD farms (those with multiple years of data) by their pre-OAD labour efficiency. The OAD farms that had been the least labour efficient (lowest quartile) before switching to OAD increased profitability by 23 percent; the next quartile essentially maintained profitability (-1 percent); and the two upper quartiles declined (-10 percent and -32 percent), although were still profitable.
In other words, the farms with high labour efficiency prior to switching to OAD struggled to improve efficiency or reduce costs further. This illustrates that the impact on profitability of switching to OAD is influenced by the pre-OAD system. One further point to note is that if going OAD postpones capital expenditure (e.g. continuing to use an old dairy), then this is an economic benefit.
However, it’s also worth considering the other common benefits of milking full-season OAD, such as more family time, and better lifestyle, staff retention and system operating flexibility (e.g. milking time). Milking outside of conventional milking hours could open up a potential new pool of people available to work on-farm.
These benefits are not captured in profitability, but can influence a farmer’s decision to switch to OAD.
In summary, for those evaluating full-season OAD, estimate the likely changes to herd performance (e.g. production, reproduction) and farm management (e.g. impact on costs, particularly labour) and prepare a budget. The resulting budget should be considered alongside the intangible benefits and your personal goals to determine whether OAD is a good option for your circumstances. It's likely that full-season OAD suits considerably more farms than it's currently used on.
New research into 3-in-2
The greater potential production loss for higher producing herds switching to OAD milking, and the higher fixed costs on some farms (e.g. irrigation), mean OAD can result in poorer profitability. For these systems, 3-in-2 milking has been proposed as an alternative strategy.
Over the years, little research has been done on 3-in-2. The most relevant study – where a seven percent reduction in milkfat was measured over the full season – was presented at the Ruakura Farmers’ Conference in 1985. However, payment systems and genetics have changed considerably since then, which is why DairyNZ kicked off a three-year study in July 2019, funded by the Sustainable Farming Fund and DairyNZ.
Check out dairynz.co.nz/flexible-milking for more information and to subscribe to receive the latest updates.
This article was originally published in Inside Dairy October 2019