Australia's leading dairy cow leasing company CowBank recently took farmers on a search across Victoria and South Australia for dairy's "Holy Grail" - sustainable low cost milk production.

Anecdotal findings from the comprehensive farm tour reflected what tour leader and CowBank founding Director, Rod Banks, sees as vital features of a sustainable low cost milk producer:

• The operator is ready to manage every aspect of the business;
• The farm will grow more than four tonnes of quality grass per cow per year;
• The herd is large-frames, weighing an average of 580 kilograms-plus and has no unprofitable cows;
• The infrastructure allows cows to move freely from feed to shed and through the shed;
• Supplementary feed is at least two tonnes per head per year; and
• The operator has a good advisor who helps keep focus on farm business goals.

"As we're a unique business financing dairy herds, out people need to understand and work with leading dairy farmers," Rod said.

"While it is important to us at CowBank that we work with dairy farmers who can grow grass, love their cows and are good people, profitable farming is more fun so our search was to help understand better what profitable farmers are doing."

"The enthusiasm, efficiencies and keenness to share information displayed by everyone involved in the tour proved to me that the dairy industry is resilient because of the quality of the people involved in it."

Dairy farmers from Lismore in NSW to Tasmania and all the main dairy areas in between met with leading dairy farmers from Victoria's Western District to South Australia's Lower South East on the tour.

A key area of interest was that of what it takes to move towards being a sustainable low cost producer. The CowBank herd lease is one of the financial options available to dairy farmers to fund transition.

Leasing is an alternative that many dairy farmes are familiar with; however, the CowBank option opened many eyes to an extension of this financial arrangement.

"We already have 110 active leases representing more than 21,000 dairy cows leased across Western Australia, South Australia, Victoria, Tasmania, NSW and Queensland," Rod said.

"One of the many differences with CowBank is that we are the only company to offer the market the opportunity to lease livestock rather than finance it through a livestock mortgage."

"CowBank's lease can be for the full purchase price of the animal, is not linked to mortgages to land and the full lease payment is a tax deductable expense to the lessee."

Successful practices implemented by host farms on the tour included:

 

• At Colac a 240 cow farm with large frame cows producing up to 10,000 litres per year is regularly visited by a consultant
• A demonstration of different scenarios of financial performance at using different assumptions for grass, feed, cow numbers and cow size using "CUD" software from the Dairy Business Centre.
• Every single cow matters, they must be profitable or not in the herd.
• A fee pad can ease the pressure on pasture, reduce pasture damage. This tool is important provided it is used properly.
• Management of heifers' growth to become 580 to 600 kg at first calving increases profitability.
• Drainage of country can rapidly increase pasture grown and utilised by as much as 5 ton per ha per annum.
• Beef side of a dairy business can be extremely important to overall profitability.
• Lots of key regular jobs can be contracted so that experts come in complete the job and move on, reducing the need for underutilised staff.