The entire world has dealt with restrictions because of the COVID 19 pandemic. People are now facing the “new normal” for living their lives. The outcomes of COVID 19 are many and include distancing, hygiene, isolating, operating from home (work, education, meetings, childcare, socializing, communicating, telemedicine, …) and more.
Is life changed forever? Is it time to realize and re-organize for tomorrow’s success? Time will tell. Of course, the immediate challenge also includes how to move forward with business, employment and social interaction. We must develop strategies and practices for the human population to establish robust and dynamic immunity programs.
Professor & Author Brene Brown Puts Going Forward This Way (April 20, 2020)
“We will not go back to normal. Normal never was. Our pre-corona existence was not normal other than we normalized greed, inequity, exhaustion, depletion, extraction, disconnection, confusion, rage, hoarding, hate and lack. We should not long to return, my friends. We are being given the opportunity to stitch a new garment. One that fits all of humanity and nature.”
Only One Alternative – Plan and Move Forward
The dairy farming industry, like all of agriculture, needs to take what has been learned from COVID 19 to produce safe healthy food for a changed world.
The Bullvine offers some ideas for readers to consider as they adapt. It amounts to engaging opportunities in the new reality.
Agriculture Has Always Implemented
Challenges taken. Opportunities met.
The dairy and agricultural industries have always taken the opportunity to move to new levels of excellence. Four advancements include: 1) doubling of global milk production in past thirty years; 2) North American dairy cows now produce three times as much milk as they did seventy years ago; 3) the genetic ability of dairy cows for production and conformation are 20% higher than they were twenty years ago; and 4) each US farmer now feeds 200 people where seventy years ago it was 16 people fed per farmer.
Dairy farming and the dairy cattle improvement industry have made significant progress in the past decade. Butterfat is now a positive. Yet milk production exceeds demand in many countries. Resulting is depressed farm gate prices.
Opportunity Themes for Dairying
The Bullvine offers six Opportunity Themes for dairy farmers, their advisors and service providers to use in planning and execution in the future. The pace of change will be fast. Based on what is currently being published and talked about on how healthy food will regain in importance to consumers. And knowing that dairy farmers’ history of turning on and producing more milk there will continue be tight on-farm margins in the coming years. The following six opportunities will need to be applied to all areas on-farm and in the entire industry. Of course, opportunities always require investment to yield a positive outcome.
- Revenue Generation – Income is the major driver of all businesses and for dairy’s future it will be closely associated with marketing and consumer needs, demands and preferences. Just think of the opportunities for dairy of setting and achieving the goal of 10% increased sales of enhanced fluid milks (to children, athletes, seniors, …) and 10% increased sales of milk solids products (which may well include alignment with other food producers and processors). In the end only with increased revenue will all dairy industry stakeholders be viable.
- Efficiencies – An efficient operation is the second biggest factor that determines success. On a total operation basis, it includes improving efficiencies in both variable and fixed costs on farm, in processing and in wholesale-retail. Without continually improving efficiency there is not sustainability.
- Value-Added – If any device, decision, service or approach does not enhance the bottom line, lifestyle or the overall operation success then it is a negative not a positive.
- Virtual– COVID 19 has shown that the world is now virtual. All sectors of the dairy industry must adopt and adapt. Perhaps not exclusively but the WWW provides an excellent means for communication, information sourcing, education and training, banking, marketing, ordering supplies, shopping, … etc.
- Business Relationships – Farmers working collectively has been a significant factor in the past success of dairy farming. That will continue in the future, but close mutually beneficial relationships must be expanded to include the milk processors and retailers as well as input suppliers.
- Practices – In order to guarantee food quality, safety and traceability, the practices and protocols on-farm, in transport, in processing and in delivery to retailers will be required to be documented and available to both other stakeholders and consumers. Accepting accountability for how milk is produced, handled, processed and delivered is the way forward.
Be Ready for More Industry Changes
Dairying must be ready for even more changes in the 2020’s. The pace of change will be accelerated. Those who hold back or oppose will be left behind. Some changes could include:
- Sire Selection – With already 70+% of dairy sires used being genomically evaluated and with perhaps 40%-60% bred beef, the use of daughter proven sires (dairy or beef) is likely to be discontinued. When, not if, the reliabilities for genomic indexes reaches 85% for production and 75% for health traits, turning generations will be much more important the accuracy of indexes. Breeding companies’ programs would be significantly changed.
- Animals with the Best Genes Regardless of Breed– Dairy farmers have favored one of about six breeds of cattle. Down the road there will be a need for a super breed that is a combination of the best genes available. CDCB now produces crossbred genetic indexes. Will those crossbreds be the new breed? Or will the super breed come about because of science and invention? It is not an if or a why but a how and a when.
- Data Services – With added technology on-farm comes new data for even more accurate decision making. Past practices of third-party eyes, official designation and international approved devices and practices will become less important and less used when dairy farmers are running their businesses based on daily, even second by second, data capture. Who ‘owns’ the data will not be nearly as important as having integrated data systems that yield the most accurate information. The organizations, public or private, providing information or advice to dairy farms will change to an integrated data approach or they will exit the industry.
- Eliminating Services – Could the day come when it is more cost, performance and herd improvement effective to individually genomically test all replacement heifer calves at birth, cull the low indexers, allocate animals to groups according to their indexes and only monitor groups of animals for performance? Thereby reducing the costs associated with some of the current improvement services that are based on data being captured on every animal.
- Milk Leaving the Farm – The importance of fat and protein content of milk due to genetics, nutrition and management will be increased. Both lactose (fed back to animals) and water will be removed at the farm level for revenue generation, cost savings and business alignment reasons.
- Vertical Integration – Other livestock industries have systems whereby there are alignments from the farm all the way to the sale of product. Dairy could well be the next where 100,000 cow groupings align from the inputs all the way to the sale at the grocery store.
- Meetings – All decisions beyond the farm will be made without leaving the farm office. On farm decisions and instructions will be virtual.
- One Health – with over 70% of diseases in humans originating from animals, dairy farming can expect to see animal health linked more closely with human health. Expect more regulation.
- Food Security – Citizens and governments are quickly becoming more concerned about their ability to domestically source their food and to insure viable domestic agriculture. Countries and agricultural industries that produce more than their domestic needs will need to find ways to prices product for domestic use separate from product that is exported.
Of course, these nine are just a start to the long list of changes that the dairy industry may address and implement. The take-home message is be ready for challenges, opportunities and changes.
The Bullvine Bottom Line
Looking to the future always involves the unknown, opportunities and changes. The changes will challenge history, norms and beliefs but the end result must be viable and sustainable if dairy businesses are to survive.
COVID 19 put the world on pause. During this pause everyone associated with the dairy industry has a responsibility to take the time to find the Opportunities to Create the Future.
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