DAERA Notes: Finance

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Measure monthly to manage: How is your farm performing? Regardless of the type of farm you run you can answer that question by looking at a long list of key performance indicators including herd health, fertility, growth rates, feed efficiency, milk from forage, lambs per ewe, pigs per sow, milk yield, milk solids and many more.

The old adage ‘you can’t manage what you don’t measure’ is very true. Without monitoring herd performance, it is very difficult to manage the farm business.

CAFRE has been offering an annual benchmarking system since 1999. This allows you to assess farm business performance on a yearly basis and compare your business with other businesses. Annual benchmarking is an important tool for any business as it takes into account all the costs and receipts for each farm enterprise. However, by definition it is always looking back over a 12 month period.

Businesses performance should be monitored on an on-going basis, using the most up to date data, if at all possible. This allows for timely management decisions to be made throughout the year.

With this in mind, CAFRE has developed an additional online tool that lets dairy farmers assess their herd performance on a monthly basis. Margin Over Concentrate (MOC) is a simple, useful measurement tool, looking at the income from milk sales and the cost of concentrate feed for the dairy herd during a month.

Concentrate feed accounts, on average, for about a third of the overall cost of production for a Northern Ireland dairy herd. This of course depends on the system of production, with some systems spending a significantly higher proportion. If concentrate usage can be managed efficiently this impacts on the profit generated.

Input figures required to calculate MOC

Three sets of figures are required:

* Cow numbers

- Cows in milk at end of month

- Dry cows at end of month

* Milk details

- Litres sold

- Litres used on farm (or dumped)

* Value of milk sold, less transport

Concentrate details

- Tonnes of blend used

- Cost per tonne of blend

- Tonnes of nuts used

- Cost per tonne of nuts

It should take only a few minutes to enter these figures. The MOC tool is accessed through the DAERA Online Services page: www.daera-ni.gov.uk/daera-online-services and is available to all dairy farmers. Each of the figures relates to the month that has just passed. As soon as the milk cheque is available the figures can be entered.

Results

The results that are calculated from the input data provide up to date indicators of herd performance. You can use all of this up to date information to set production targets for the current month.

Monthly results:

- Daily yield per cow

- Daily concentrate fed per cow

- Daily milk from forage

- Concentrate fed per litre

- Concentrate cost per litre

- Daily MOC per cow

Each farmer who enters data will see a league of anonymous results allowing them to compare their herd performance against the top, bottom and average results. Once 12 months of data have been entered the system will display rolling annual averages.

The next time you log on to DAERA Online Services to register a calf on APHIS Online, look out for the blue ‘CAFRE Benchmarking’ button and put a note in your calendar for the day the milk cheque arrives to fill in your MOC data.