Managing $5, $6, $7 bu corn DAIReXNET Dairy Webinar

$20 milk in 2004 is not $20 milk in 2008 Hay prices varying from $200-$275 a ton Corn silage at $50 to 60 a ton Corn grain at $5 to $8 / bushel Breakeven milk prices have reached a new level ($16-$18 per cwt in Illinois) It’s a new dairy game; we need to adjust!

Hay prices varying from $200-$275 a ton

Corn silage at $50 to 60 a ton

Corn grain at $5 to $8 / bushel

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

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

Monitoring feed costs in 2008

Strategies with high corn/barley prices

Other management aspects

Point 1 Monitoring Feed Costs

Feed Costs 101 lb DM $/ lb DM $ / day Forages 28 .10 2.80 Grain energy 10 .10 1.00 By-product 6 .15 0.90 Protein supp 5 .15 0.75 Min/vit/additive 1 .35 0.35 Consulting 0.10 Total 50 5.90

lb DM $/ lb DM $ / day

Forages 28 .10 2.80

Grain energy 10 .10 1.00

By-product 6 .15 0.90

Protein supp 5 .15 0.75

Min/vit/additive 1 .35 0.35

Consulting 0.10

Total 50 5.90

Feeding Economics Feed costs per cow per day $5.90 Feed cost per lb DM $0.118 Feed cost per cwt (80 lb) $7.38 (80 lb) $8.42 (70 lb) Income over feed costs ($18) $10.62 Feed efficiency (lb milk/lb DM) 1.60 (80 lb) 1.40 (70 lb)

Feed costs per cow per day $5.90

Feed cost per lb DM $0.118

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

Income over feed costs ($18) $10.62

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

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)

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 Dry matter intake vs. milk price 2 pounds of milk per pound of DMI 40 to 44 cents income vs. 12 cents expense Comparison of forages vs. grain vs. fat Corn silage ($60/t) = 12.5 cents per Mcal Corn grain ($7/bu) = 20.3 cents per Mcal Oil (49 cents/lb) = 21.8 cents per Mcal

Dry matter intake vs. milk price

2 pounds of milk per pound of DMI

40 to 44 cents income vs. 12 cents expense

Comparison of forages vs. grain vs. fat

Corn silage ($60/t) = 12.5 cents per Mcal

Corn grain ($7/bu) = 20.3 cents per Mcal

Oil (49 cents/lb) = 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

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

Rumen Fermentable Carbohydrates—The Key Starch (corn or barley): 20 to 26% Sugar (molasses or whey): 4 to 7% Digestible/fermentable fiber (beet pulp or citrus pulp): 10 to 14%

Starch (corn or barley): 20 to 26%

Sugar (molasses or whey): 4 to 7%

Digestible/fermentable fiber (beet pulp or citrus pulp): 10 to 14%

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

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

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) 0.96 Finely ground (1100 micron) 0.94 High lysine (floury) 0.93 Steam flaked (24/25 lb bu) 0.93 High moisture (>26%) 0.89 Ground (1500 micron) 0.84 Cracked (2200 micron) Mcal/lb DM

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

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).

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).