Opportunities to improve production and decrease risk in a dairy business by utilising a complementary forage system

Abstract

The Australian dairy industry is experiencing the cost-price squeeze common to many agricultural industries. Farmers need systems that are highly productive and which produce more milk per hectare from relatively lower cost home-grown feed. One option is to use a forage crop rotation (maize, brassicas, and field peas in sequence) and when incorporated with pasture, this is termed a complementary forage system (CFS). The principal objective of this investigation was to determine the potential impact of using a CFS on production, profitability, and risk using 8 commercial case study farms located in two dairy regions in Australia. These farms were analysed using a dynamic whole farm system model, financial model, and risk analysis. In order to examine the potential effect of a CFS on these farms, a triple crop forage system was modelled to occupy 35% of the farm area (Study 1), and then compared with purchasing feed and leasing land as system changes (Study 2) for individual farmers to achieve their production goals. A risk analysis of the system changes was undertaken in Study 3. The studies reported that seven out of the eight case study farms experienced a higher operating surplus under a CFS system. While the base farm system resulted in the lowest variability in operating surplus, the CFS produced a higher operating surplus across a range of probabilities on seven out of eight farms. Milk price and pasture cost were the two variables that had the largest impact on operating surplus across all farms. A decision support tool was developed to investigate the sensitivity of pasture cost to irrigation water price, utilisation, water use efficiency, and nitrogen use efficiency of pastures in irrigated dairy regions. This thesis has demonstrated that a CFS has potential in terms of increasing operating surplus across a range of farms; including those in different regions, and with unique goals. In addition, the thesis presents a decision support tool for industry.