Are you managing your margins?

01 July 2015
2 minutes

De Heus is focused on margins and constantly trying to improve margins. In order to do this, a tool was developed to assist farmers to effectively measure margins as well as to point out areas of concern.

The Margin Monitor Milk was initiated in the Natal region of South Africa seven years ago and has now been accepted as a world-wide tool within De Heus. Each farmer can be measured against other farms anonymously, within region, within different feeding strategies, as well as nationally, or even internationally. With the completion of the most recent analysis almost 160 De Heus’s SA farms, including almost 65 000 cows in milk were calculated making it a very effective and relevant aid.

This gives both the farmer and the advisor the ability to see trends and learn what works, and in doing so cross pollinate farmers with ideas that work.

Ration efficiency and feed conversion

The main points obtained from this were mainly ration efficiency and feed conversion and the effect of this on the margin of the farmer and the ability then to point out which factors are negatively affecting it. As can be seen from the graph, for instance, is that there is a direct correlation between milk production and margin but that there is also a clear indication that some farmers make more margin on the same production than others.

Key to success

To help to identify these areas where farmers are more efficient is the key to success in powering progress for the dairy farmers. Since the application of the margin monitor, huge improvements have been made by farmers and each year the group of farmers as a whole move closer to the means showing us that the focus on specific points are paying dividends.

The Margin Monitor Milk helps the farmer and De Heus to focus and change the management of both animals and feed (roughages & compound feed) where needed to obtain optimum efficiency. Ultimately, it helps the farmer to reach the goal of making a better margin.