Murray Dairy Focus Farms

Focus Farms in the Murray Dairy Region

Focus Farms is a two-year program which helps dairy farmers better understand their farm performance and take regular, positive action to grow their business.

Working with an experienced dairy consultant and a peer support group, Focus Farmers set production and finance goals to work towards over the two years of the project and into the future. They also develop business plans which align with their farm goals, development, lifestyle preferences and succession, which are reviewed throughout the program.

The Focus Farm support group is made up of 12-15 local farmers and service providers, who are invited to participate by the Focus Farmers themselves.

The team regularly meets on farm, concentrating on supporting the Focus Farmers to achieve their goals by working through strategies and options for different aspects of the business. Each month and at the end of each year, goals and strategies are analysed and reported on through Dairy Australia's Focus Farm reports (available below), industry publications and other sources, including rural weekly papers.

The in-depth analysis of the farm’s decision making, on-farm development and risk management has made the Focus Farm program successful for participants and the local community.

The community is also invited to participate in Focus Farm learnings and achievements through regular on-farm open days, where farm performance and management changes are openly discussed.

For further information about Murray Dairy Focus Farms please contact Murray Dairy on (03) 5833 5312 or admin@murraydairy.com.au.

The Furze family, Tallangatta South

Follow Paul and Jess Furze’s Focus Farm journey here.

August 2019

The 2019–21 Murray Dairy Focus Farm was launched on 5 August 2019 at Tallangatta South, Victoria, giving the Focus Farmers, their support group and farm business consultant Phil Shannon the chance to get to know each other.

Paul and Jess Furze have worked hard across a number of different roles to get a start in the dairy industry. This has included working in a law firm and getting a law degree, running a family dairy farm, purchasing the non-dairy portion of a family farm, driving a log truck while running a dairy farm, leasing a farm, upgrading the farm and vendor financing a herd.

The Furzes, along with their three children, are beginning their Focus Farm journey by concentrating on cost-effective ways to lift their feedbase and milk production while still establishing their business and strategy.

September 2019

On 2 September 2019, the Focus Farm support group spent a day on farm. Seeing the farm and the herd and hearing from Paul, Jess, Phil and the Furze’s agronomist Darren McCormack provided the support group with a clearer picture of the Furze’s business goals. It also gave the group a chance to discuss opportunities to improve performance within their scope of funding and resources.

There was plenty of discussion as cash flow was tight and milk production was down on expectations. However, the group was confident that by making immediate changes to grazing management, the Furzes would see an increase in production as a result of increased pasture growth and fresh cows coming into the milking herd.

The group discussed the importance of monitoring and adjusting grazing with the change in herd size and climate, which included shortening the rotation, adjusting allocations and checking the herd response. Following that, the Furzes could consider opportunities to adjust the concentrate to improve the margin over feed costs.

Discussion on silage making followed, with further discussion on labour, lost opportunities as a result of late sowing in some of the paddocks and under-utilisation of feed on lower priority areas of the farm.

Looking ahead, the group discussed the upsides of tightening the calving pattern, the location of a maize crop and associated irrigation and best use of the Furzes' out-block.

October 2019

Following the discussion about grazing management at the previous meeting, the group was pleased to see Paul and Jess had implemented better spring grazing strategies and, as a result, milk production had improved in line with pre-season budgeted expectations.

Paul was happy with both the bulk and quality of the silage he was making at the time and he was hopeful of using the silage for the autumn calvers. Once spring had finished, Paul would assess the quality and quantity of feed produced and calculate the expected feed gap.

Jess and Paul had been working hard to get the irrigation system up and running, which would be a huge benefit in watering fast-growing spring pastures. Based on the forecast yield and costs, the irrigated spring pasture would cost about $200 per tonne, which the support group agreed was well and truly worth the effort, especially with a favourable milk price and increasing uncertainty on bought-in fodder prices.

With so much still up in the air, the immediate feed plan was to:

Optimise irrigation to maximise feed produced
Set up for a dryland summer cropping program, assessing irrigation availability at the end of the month to see if an irrigated summer crop is a viable option
Keep an eye on the feed market to secure quality feed at a price the Furzes can make a margin on
Stay on top of grazing management using the Rotation Right Tool, as used in the Feeding Pastures for Profit program

All feed planning decisions were being weighed against cash flow, milk price, feed availability and feed prices. Whilst decisions needed to be made carefully to ensure the Furzes do not run into cashflow pressure, they still needed to make the most of any opportunities to secure feed, hold production and capitalise on the high milk price.

The group spent some time discussing management of spring and autumn calvers, in particular the 20% of carryover cows in the herd. With cashflow tight, selling some of these as choppers was discussed. The group also suggested replacing cows with a low margin-over-feed-costs with higher-margin cows, given the availability of cheap and efficient replacements. The group agreed this was a good option from a budget point-of-view, based on the milk price and current feed situation.

Considerations for the introduction of new cows were discussed, including herd dynamics, the expected internal replacement rate and the impact on cashflow. The calving dates of current and new cows was also raised as a major consideration, particularly in relation to the timing and size of the spring calving. Being such a big topic, the discussion was held over for a later meeting.

November 2019

The focus following the October meeting was on holding production between the end of spring and the start of the summer cropping program began. Paul and Jess handled this period admirably, watching the cows and vat closely to ensure they were getting the most out of each paddock and balancing it out in the dairy. Given recent seasons, the 1.82kg milk solids/cow/day being achieved was below the herd/farm potential but above what was budgeted for. This pointed to good operational management and the potential to continue to improve further as the business matured.

Prior to the meeting, the Furzes were focused on making the most of spring, with irrigation a key component in keeping the pasture going while keeping one eye on setting up for a summer crop and establishing an autumn crop. The discussion for this meeting centred on the opportunity cost of water, particularly what the best use is on-farm versus the option of selling some water.

This was a big decision for Paul and Jess, as they had to consider a number of factors:

The area available for summer crop
Time and risk of the cropping program
How much water would be needed in autumn
Production potential
Cost/risk of buying feed
What the water market was likely to do

With spring finished, Paul and Jess had calculated the feed gap and were watching the feed market closely, with the water price at a point where selling it and buying quality feed could stack up favourably against using the water on-farm.

The option to sell carryover cows at a profit and bring in high-producing fresh cows was also discussed. There was a theoretical higher herd/farm potential than what was being achieved at the time and a key component of achieving this potential was with an improved herd structure driven by improved reproductive performance.

By buying in fresh cows there would be an immediate improvement in milk production and, with a subsequent improved reproductive performance, a long-term production and profitability outcome. The partial budget produced by Phil Shannon to outline these assumptions made the purchase option clear. However, when Phil contrasted the partial budget against the budgeted cash flow and the current capital position, it was obvious that financing this option would be a big obstacle, which gave the Furzes plenty to think about.

Despite some operational improvements and options with water and cows, there was a lingering question on overall business balance. There was a long discussion on the best use of capital, debt, leased land/cows and operational surplus to achieve the best long-term outcome for the Furzes. In order to plot out what the most viable structure might look like, the group decided to hold the next meeting on the out-block at Huon owned by the Furzes.