Thinking about expanding but not sure

Philip d

Well-known Member
With all the growing domestic market in dairy products we can barely and most days not quite fill our quota with our current milking capabilities. We were thinking about a new 2nd robot but are instead considering a used one from the UK which could be imported reconditioned and upgraded to same as new. It in the end would likely be about half the money as a new one. We could than convert a manure storage and dry cow pen to more stall and bunk space to house up to 100 cows and add on more space to accommodate dry cows heifers and manure storage. The barn yard needs to be resurfaced in the spring as well and we found a nice local used 12' high dump on the wish list too. Meeting with the bank in the next couple of weeks,also our M8200 Kubota soon needs replaced. They may laugh us out the door with these milk prices.
 
There is a glut of cheese and all Dairy prices seem to be marginal at best. They would make a bundle if they could give soy milk. My Grand Dad and dad stopped milking in 1956. It was a good decision. What do futures look like? Jim
 
That's right,were in eastern Canada. There is a worldwide butter shortage for various reasons but a surplus of protein. The futures are looking a little better than the last year lots of growth potential but at the same time the price isn't coming up any or much.
 
I guess it all comes down to , what you can cash flow , and how much labour do you have. If the tractor is needing to be replaced anyway I wouldn't lump it in with the barn/herd expansion thoughts. Even if you don't expand , the tractor will still be worn out. One of my friends is the local Lilly dealer , and last year put two rebuilt VMS units into their own barn . Seems to be getting a long fine with them , but of course they fix the units too. Expanding has been on my mind too for the last few years, and we just got one step closer this past week by finishing up the addition to our milk pipe line. We now have 105 cow milking stalls under the milk line, but it will take a while to put a milking cow into each stall.You say that you are worried about the current milk price, it isn't the current price that bothers me , it is what the future price will look like .Our price is strong right now at .96 per litre CND. , with my cost of production at .50 per litre. If you chopped .25 per litre off that price , things would not feel so rosey . Bruce
 
Your deductions should be close to mine , so knock .05 per litre off what I had written . I know one guy that got .68 per litre gross last month , but his fat test was only 3.65% . I thought your milk price was closer to ours, I know your Quota price is now a bit lower . You could always sell some of the Quota that you are struggling to fill , and replace your aging tractor with the $$ . Just a thought .
 
That might be a possibility too if the second robot is a no go,we have close to 10 extra kg quota we didn't have to buy since we put it in 3 yrs ago we were maxed than.
 
Sounds like working on a little more milk per cow would solve the "problem" without requiring a bank loan.

Just a dumb American dairyman here... so what happens if you ship more than youur quota? Do you have to dump it? Or do you just get paid less?

And I assume if you want to expand, you need to buy more quota, too?
 
Not sure we're your located, but if your surviving on these milk prices, your no dumb dairyman, it's about $15 or $16 +_ per hundred here in NY. Ridiculous.
 
We have a 30 day production sleeve , 20 days under /10 days over . Once you have exhausted your over production credits , you are charged for all of the same check offs , like trucking and admin. fees, but receive zero payment for your milk. The only way to "pay back " borrowed production credits , is to under produce your quota. May sound difficult , but it is surprisingly less trouble than you would think.
 
I know the Quota system is strange to you connie , but shipping more milk per cow wouldn't necessarily solve this problem. You see the Quota is in kilo grams of fat. So the higher the % of butter fat milk you ship the lower the number of liters of milk you need to ship to fill quota. So if philip were to raise the herd fat est from 4.2% to 5.2% and ship the same volume of milk , he would not only fill his quota , but raise his blend price too.
 
One of the troubles with a robot is you basically can only produce so much milk per stall as more milk per cow either requires more visits per day/cow or longer stall time when they're in there. You can produce almost as much milk with 55 cows in a robot as you can 65.
 
We get paid on components too, so it isn't all that complicated. I'll just edit my suggestion for "fat yield" and not "milk yield".

Has quota always been regulated in lbs fat? And why not Lbs protein?
 

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