Dairy farming: McKillops’ recipe for success in Victoria’s North East
STRICT attention to herd genetics and feed is paying off for a North East dairy farm, writes SIMONE SMITH.
SCOTT McKillop talks of a recipe for dairy farming in Victoria’s North East.
Good functional cows that last, milk well and get back in calf are vital ingredients.
But the key, according to the farmer from Dederang, is a production system focused on pasture management and pasture utilisation.
“As much directly down their throat as we can,” Scott said. “The more of that grazed is better. Fed back through silage is the next best option.”
SCOTT AND BELINDA McKILLOP
DEDERANG
MILK 360 Holstein cows from 200ha dairy and 300ha fodder outblock
ALSO rear heifers and run 50 Hereford cows and calves
AIMS to breed good, functional cows and last, milk well and get back in calf
INVOLVED in the new Mountain Milk Co-operative
Like all good recipes, sustainability is at its heart. This recipe has seen Scott, his wife, Belinda, and children Angus, 11, Lexi, 9, and Marli, 7, with parents Gordon and Meg, through many seasons.
It is one the family hopes will propel their farming business into its next stage as part of the new Mountain Milk Co-operative — due to kick-off later this year.
The co-operative includes four North East farming families with the group recently announcing it would enter into a supply agreement with Australian Securities Exchange-listed Freedom Foods.
The Mountain Milk members use the term sustainability frequently, in reference to the environment, their business and also community and business relationships.
Scott and Belinda are no different.
With an average rainfall of about 900mm, they say it is possible to get a great year off 700mm, but timing of the falls is what is important.
“Dry winters suit us as long as we get a spring and autumn,” Scott said.
SPLIT SHIFT
WET conditions are the key reason the McKillops stuck to a split-calving operation. Eighty per cent of their 360-head Holstein herd calves in autumn and the rest in spring.
“The heavy black clay loam soils are pretty flat and do water log,” Scott said. “Taking the 50-60 cows out of the system in late June-July it eases the pressure on the farm a bit when pasture production is declining.”
Scott says a silage reserve is fundamental to farming in the North East, helping manage extreme weather that can include anything from “cold frosts to fearfully hot summers”. Scott sees this as building resilience into a farming system and helping manage risk. The “rule of thumb” is always to have at least a tonne of dry matter silage per milking cow up your sleeve, but, due to season variability, Scott now aims for two tonnes per cow. “You need to have insurance up your sleeve to make sure we can ride out the tougher seasonal conditions.”
Scott said last spring was one of the best in four decades and “probably more like the traditional springs we get ... the last couple of years we missed out on rain in October and it rained November, December and January”.
The McKillops made the most of it.
“We certainly have never cut as much grass off our milking and out country before,” Scott said. “We have done about 2500 wet tonnes of pit silage at 40 per cent dry matter (mostly ryegrass, perennials, annuals and Italians). It’s the most we have ever done before … 50 per cent above the average. We have also done a bit over 400 bales of silage, as well as 300 bales of hay.”
Scott said this year he cut paddocks for silage in October, applied fertiliser and then 18 days later they were “beyond grazing” so were dropped out of the rotation and cut again for silage.
STOCK TAKE
THE McKillops milk off 200ha, which Scott said was at the “upper end of the stocking rate” for a dryland farm in the region, but they have the support of a 300ha out-block for fodder production, rearing heifers and running 50 Hereford cows and calves.
Pasture growth is six to eight tonnes/ha.
“Three tonnes of pasture consumption at a minimum, two tonnes of concentrate and one tonne of fodder generally is a pretty good recipe for this region,” Scott said. “Trying to keep your bought-in feed costs under 40 per cent … that’s also pretty handy in terms of helping your profitability.”
Most years bought-in feed costs have been 28-35 per cent of the McKillops’ total budget.
Chicory has been used during the past seven years throughout pastures to “help get through the shoulders of the season”.
Describing himself as the “biggest fan of chicory”, Scott said he planted about 25ha and the cows milked well off it.
Scott, who has a background in agronomy and stockfeed, has tended towards forage sorghum in recent summers due to rain during the warmer months.
This year there is 6ha of sorghum and another 6ha of a combination of chicory and hunter. This is down about half due to the large amount of silage cut and the perennial ryegrass persistence.
Scott is a firm believer that if you do not look after your cows they won’t look after you.
“It is as simple as that,” he said.
The herd continued to be a priority last year, when farmgate milk prices were low for the Murray Goulburn suppliers, although they trimmed costs.
MILK MADE
THE McKillops’ farm working expenses — the cash cost of producing milk — is generally $4.20-$4.50/kg of milk solids. .
“(Last season) we probably tweaked a few things around grain, we used a little bit of barley for a little while, mixed a bit of barley and some wheat together and cut back some of our additives to a slight extent,” Scott said.
“But we didn’t really change anything around our calf-rearing practices. You can make changes that will save you money, but if they end up costing you from a personal perspective, in terms of overworking yourselves and destroying yourself. It’s kind of counter-productive.
“We have a long-term view of being around in the industry.
“We thought we had the capacity to take the hit and ride it out.”
The family sold heifers to export, offloaded 30 Friesian steers, and leaned on their beef herd and strong culling of the dairy herd for extra cash flow.
“Without the high beef price during that low dairy prices (period) it would have been a hell of a lot harder from our businesses point of view,” Scott said.
Through genomic selection, the McKillops were able to “weed out the bottom end of their heifer herd” which helped with cashflow. “We struck them out based on their daughter fertility, mastitis resistance and (Balanced Performance Index rating),” Scott said.
TIGHT GENES
GENOMICS is used for a range of decisions within the business, including determining the allocation of semen.
“We decided it was a cost to do it (genomic testing), but a cost we decided to continue with,” Scott said.
“It allowed us to better allocate the top-quality semen across the best animals and get the best return from that.
“In the past with our heifers, for a couple of years, we used sexed semen across the whole lot for one round. We thought, ‘surely we can be smarter than that’.”
Since, the McKillops have used genomics to select the top 50 pent of their heifers — which receive two rounds of sexed semen.
“If we can get ourselves 40 heifers out of our top 60 it is going to have a huge impact on the top end of the herd,” Scott said. “Rather than mating the best with the worst, we are sort of mating best on best. Putting the elite stuff over the best heifers we have.
“The lower genomic group got one round of conventional semen, then Jersey bulls ran with them.”
These are the first lactation genomic tested animals in the herd, Scott hopes to validate genomic data by combining it with lactation information. Heifers are also physically classified, with these assessments matching up well with the genomics.
The family runs a high heifer replacement rate of 25-30 per cent. The average herd age is five years old, which is having a positive impact on fertility and herd health. But there are no plans to dip below this as it affects the return on the heifer. “They need the first lactation to pay off cost of rearing and development,” Scott said.
Heifers are genomically tested using the Clarifide system, normally at about nine months — before they are eligible to be sold into the export market.
Mating weight is a minimum of 350kg at 15 months.
YES SIRE
THE McKillops predominantly use the US TPI breeding system for their bull selection, which is about 80 per cent correlatable with Australian Balanced Performance Index breeding system, according to Scott.
He said he liked how the TPI was focused on health and fertility, with his personal bull selection weighted half in favour of health and fertility and the other half for production. They do not select on type.
“If the animals have a long, productive life and they have got high daughter fertility, if they are lasting in people’s herds, then surely that means they have pretty sound feet and pretty good udders,” he said.
One area of focus for the family will be ensuring their cows do not exceed the “medium-large” physical size.
They currently produce about 1kg of milk solids for a kilogram of body weight — with production at about 600kg of milk solids per cow or 8200-8300 litres per cow per lactation.
Scott and Belinda bought their herd eight years ago and say succession planning with the farm had also just finished. Consolidation is on the cards for the next year or two and they are concentrating on working on the Mountain Milk Co-operative. Potential expansion is “probably a few years away” with the location of the dairy — at one end of the farm — a hurdle to milking more cows. “(Expansion) will come back to decisions based around profitability and lifestyle has to be important,” Scott said. “We are good at running 350-400 cow farm. We could stick to that and look at other options. There’s potential, and we are looking at Friesian steers.”
With “no desire” to milk a lot of cows, or increase production if it becomes unprofitable or changes the pasture-based production system, the family will look to other areas to supplement their income. Using Wagyu semen is one option with the Mountain Milk Co-operative investigating beef sales for its farmer members.
Looking at the role of Wagyu, it will add diversity for the business base, but still keep the core principles the same. After all, it is a tried and tested recipe.
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