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Dairying: Entering a Decade of Opportunity

Dairy farmers in discussion groups make more money. That was the simple message to farmers at the Teagasc National Dairy Conference, which is taking place in Charleville in County Cork today, Wednesday, 17 November and in Mullingar tomorrow 18 November. Those attending heard how dairy farmers who are involved in discussion groups are more likely to adopt new technologies and best practice and are likely to have higher profits levels.

Teagasc economist Thia Hennessy told the 700 dairy farmers present that farmers of all levels of intensity, size and in all regions of the country could gain from membership of discussion groups. The Dairy Efficiency Programme introduced by the Department of Agriculture, Food and Fisheries earlier this year, has doubled the number of farmers involved in discussion groups in the country.

Taking two farmers from the Teagasc National Farm Survey, identical in terms of their size, the location of their farm, soil type, stocking rate and so forth, the economic return to being a member of a discussion group is approximately €200 per hectare. Farmers in less advantaged regions, starting from a lower technical base can earn a higher return. Discussion group members are more likely to adopt new production technologies. They tend to have a longer grazing season, use purchased feed more efficiently, with almost 90 per cent of members using Artificial Insemination, and 40 per cent using the newer technology of insemination with genomic bulls compared to the national average of 19 per cent. Discussion group member’s farms tend to be higher stocked and produce more milk per hectare.

Dairy farmers around the country are preparing to expand milk production when milk quotas end on 31 March 2015. Head of dairy knowledge transfer in Teagasc, Tom O Dwyer told the conference that for the first time in almost three decades Ireland has the opportunity to significantly grow its dairy industry. He said: "The preparation has already started - there are increased numbers of replacements on farms, increased levels of reseeding, and co-operation between milk processors."

The Food Harvest 2020 report suggests that dairying can expand by 50 per cent between now and 2020. Tom O Dwyer said: "Expansion represents the best option available to very efficient farmers who wish to maintain or increase farm income. However, expansion does not represent a viable option for inefficient farmers as expansion will require on-farm investment, leading to higher borrowings. Expansion can be achieved through a combination of increased deliveries of milk per cow and increased cow numbers."

He pointed out that Ireland’s competitive advantage is in our ability to grow large amounts of grass; the challenge is to efficiently convert this grass into milk and a range of milk products. The achievement of the 50 per cent growth target will result in 2.7 million tonnes of additional milk, all of which will have to be processed and marketed.

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