Managing $5, $6, $7 bu cornManaging $5, $6, $7 bu corn

DAIReXNET Dairy WebinarDAIReXNET Dairy Webinar

$20 milk in 2004 $20 milk in 2004 is not $20 milk in 2008is not $20 milk in 2008

• Hay prices varying from $200-$275 a ton Hay prices varying from $200-$275 a ton

• Corn silage at $50 to 60 a ton Corn silage at $50 to 60 a ton

• Corn grain at $5 to $8 / bushelCorn grain at $5 to $8 / bushel

• Breakeven milk prices have reached a new Breakeven milk prices have reached a new level ($16-$18 per cwt in Illinois)level ($16-$18 per cwt in Illinois)

• It’s a new dairy game; we need to adjust!It’s a new dairy game; we need to adjust!

Today’s Program

• Monitoring feed costs in 2008

• Strategies with high corn/barley prices

• Other management aspects

Point 1

Monitoring Feed Costs

Feed Costs 101Feed Costs 101

lb DM $/ lb DM $ / daylb DM $/ lb DM $ / day

Forages Forages 28 28 .10 .10 2.802.80

Grain energy Grain energy 10 10 .10.10 1.001.00

By-product By-product 6 6 .15 .15 0.90 0.90

Protein supp Protein supp 5 5 .15 .15 0.75 0.75

Min/vit/additive 1Min/vit/additive 1 .35.35 0.350.35

ConsultingConsulting 0.100.10

Total Total 5050 5.90 5.90

Feeding EconomicsFeeding Economics

• Feed costs per cow per dayFeed costs per cow per day $5.90$5.90

• Feed cost per lb DMFeed cost per lb DM $0.118 $0.118

• Feed cost per cwt (80 lb)Feed cost per cwt (80 lb) $7.38 (80 lb) $7.38 (80 lb) $8.42 (70 lb) $8.42 (70 lb)

• Income over feed costs ($18)Income over feed costs ($18) $10.62 $10.62

• Feed efficiency (lb milk/lb DM)Feed efficiency (lb milk/lb DM) 1.60 (80 lb) 1.60 (80 lb)

1.40 (70 lb) 1.40 (70 lb)

Economics of Feed Efficiency(70 lb milk, 12 cent lb DM)

Feed efficiency DMI Difference

(lb milk/lb DM) (lb/day) (savings/day)

1.20 58.3

99 cent

1.40 50.0

74 cent 1.60 43.8

59 cents

1.80 38.9

Using the 55-15-30 Rule

• 55% of the ration is forage dry matter– 28 lb of dry matter

• 15% of the ration is yours call– 7.5 lb “swing” dry matter room– Forage quality– Economics of by-products– Cheaper nutrient sources

• 30% of the ration is concentrate – 15 lb of dry matter (energy, protein, VM pack)

Feed Economics Feed Economics • Dry matter intake vs. milk priceDry matter intake vs. milk price

– 2 pounds of milk per pound of DMI2 pounds of milk per pound of DMI– 40 to 44 cents income vs. 12 cents expense40 to 44 cents income vs. 12 cents expense

• Comparison of forages vs. grain vs. fatComparison of forages vs. grain vs. fat– Corn silage ($60/t) = 12.5 cents per McalCorn silage ($60/t) = 12.5 cents per Mcal– Corn grain ($7/bu) = Corn grain ($7/bu) = 20.3 cents per Mcal 20.3 cents per Mcal– Oil (49 cents/lb) =Oil (49 cents/lb) = 21.8 cents per Mcal 21.8 cents per Mcal

Take Messages (Point 1)

• Calculate basic feed costs – Cost per lb of DM (< 11 cents per lb)– Feed costs per cwt milk (< $7.00)– Feed efficiency (> 1.5 lb milk/lb DM)– Income over feed cost (> $10.00/cwt)

• Compare to local values in your area• Are alternatives available (55/15/30)?• Avoid “bad” economic decisions

Point 2

Strategies with Expensive

Corn/Barley

Alternative Starch Sources (Source: AminoCow Feed Library)

Starch Sugar Sol Fiber

------------------------%----------------------• Wheat 64 2 3• Barley 58 2 3• Whey 0 69 0• Molasses 0 61 0• Bakery waste 45 8 2• Corn distillers 3 4 8• Corn gluten 20 2 3• Hominy 49 4 2• Wheat midds 22 5 6• Beet pulp 1 8-20 21• Citrus pulp 2 24 34

Lower Starch Levels

• Recommended levels: 20 to 26%

• Rumen fermentable carbohydrates• Feeding high quality forage• By-product by-product feeds• Consider starch availability in the rumen

• Addition of Rumensin (1 to 2 lb corn equivalent at 300 mg/day)

• Reduce fecal starch losses

University of Florida

Shelled Corn Energy Values(Dairy NRC 1989)

Mcal/lb DM

Cracked (2200 micron) 0.84

Ground (1500 micron) 0.89

High moisture (>26%) 0.93

Steam flaked (24/25 lb bu) 0.93

High lysine (floury) 0.94

Finely ground (1100 micron) 0.96

4 8

16 30 Pan

Coarsely ground grain in manure

University of Florida

Take Home Message (Point 2)

• Consider all sources of rumen fermentable carbohydrates

• Optimize feed processing to make nutrients available

Point 3

Other Managements Aspects

Management Factors• Target MUN values between 10 to 14 mg/dl (low

fermentable carbohydrates can raise herd values)

• Consider more than one TMR group– Save $1.25 per cow per day

– Lower dry matter intake saves 60 to 75 cents

– Moving cows can drop milk 0 to 5 lb per cow

• Increase corn silage levels (can lower feed costs 25 to 40 cents per cow based on current IL feed prices).