Intensive, housed dairy farming doesn't make economic sense in NZ, farmers say

Thursday 15th October 2015

An award winning dairy farm couple has described walking through "ghost town" dairy farms in the Netherlands, where cows never go outside, and told the Primary Production Select Committee that New Zealand needs to promote the benefits and efficiency of pasture-based farming, rather than move to a more European, intensive model.

Ashburton based dairy farmers Mark and Devon Slee, winners of the 2014 Ballance Farm Environment Awards, told the select committee their tour of European dairy farms showed that housing cows and relying on supplements doesn't necessarily boost production or complement New Zealand's own pasture-based feeding system.

"Feed efficiency in New Zealand is a lot better because we've got a better climate, we've got a temperate climate generally," Mark Slee said. "I see housing cows as potentially a good thing with environmental potential, but from an economics point of view it's really, really marginal. If you're going to house your cows you've got to be an exceptionally good operator."

Feeding cows supplementary food is expensive, which means farmers need to have more cows to offset the increased costs which ultimately results in more effluent adding to environmental issues, the Slees found. Aside from that, using supplements instead of grass made no difference in dairy production and volume.

The Netherlands, which has low-lying land and water quality issues, mainly houses its dairy cows and has introduced a limit of two cows per hectare to help manage effluent. Any excess waste must be taken from the farm for disposal, at a cost to the farmer.

"We were (in the Netherlands) in the early spring and it was like driving through a ghost town - we saw green fields, but no fences, no troughs, because the cows don't actually go outside," Mark Slee said.

Dutch dairy packaging would still show pictures of cows outside and in paddocks, Devon Slee said

"The consumers don't want cows inside," she said.

Mark Slee said farmers in the Netherlands perceived New Zealand farms as highly inefficient, given the reliance on pasture feeding, and thought grass was a poorer quality food. This related to cutting up grass for silage, which affects grass quality.

New Zealand needed to boost its publicity and understanding about pasture-fed dairy cows, because the free range method carried a premium price tag in Europe. The dairy farmers thought that Fonterra Cooperative Group, the world's largest dairy exporter, should move to a tiered payment system, which would pay more for pasture-based cows and should also include incentives for sustainable farming.

"We need to get back to basics and concentrate on our strengths which is growing grass, and I think we've lost sight of that a little bit," Mark Slee said. "We have got issues that we need to address, and that is around the environmental stuff because farmers have been allowed to drive our businesses, we've had the growth, we've got more cows, we've got big efficient farmers, we've got the scale.

"We're getting to a point now where there is a cost to the environment if we push things too hard," he said.

The Slees' 1,014 hectare Melrose Dairies farm has 2,600 cows and is one of four top privately-run Canterbury farms against which Lincoln University measures the performance of its dairying operations. During the 2012-13 season, Lincoln achieved a profitability margin of more than $4,600 per hectare compared with $5,200/ha for Melrose Dairy.

The New Zealand Farm Environment Trust oversees the awards which are sponsored by Ballance Agri-Nutrient, the Tauranga-based cooperative farming supplies business. The Slees also won the LIC Dairy Farm Award, the PGG Wrightson Land and Life Award and the WaterForce Integrated Management Award last year.

BusinessDesk.co.nz

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