Fertiliser Price Nightmare – Charles Holt (Lincoln)

Unless you are an organic dairy farmer, the current fertiliser market is a nightmare.  Even if you have some left in stock from a grassy season in 2021, you will surely be faced with buying some for 2022.  AHDB have produced some data assessing which dairy farmers are most exposed to high fertiliser price.  They have expressed it in terms of the percentage of variable costs.

It really is little surprise that their analysis shows that the most exposed dairy farmers (in terms of percentage of variable costs) are spring calvers, and those who house their cows the least (for 12 weeks or less p.a.).

In practice, these two groups probably include many of the same farmers.  The reason they are most affected is simply because they will use comparatively little bought in feed.  In addition, as their cows will usually be more fertile, they will spend less on the vet, and less on semen & AI, and other variable costs.  So, fertiliser always makes up a large percentage of their variable cost profile.

Nevertheless, they are right when they say that it has probably never been as important as now to understand your costs of production, and the effect that changes in your farm policy may have on those costs.  So, for instance, if you are planning ways to improve your use of slurry and FYM, partly to save fertiliser costs, what will be the cost/benefit of such a change?

For any farmer involved in a ‘straw for muck’ deal with a neighbour, the relative prices of straw and fertiliser prevailing now will have completely changed the calculation.  Straw this season is around half the price of last year, while fertiliser (i.e., FYM) prices have roughly tripled.  You may well need to re-assess any such deal.

Furthermore, what will be the financial effect of any increased use of legumes in your swards, both to save fertiliser costs, but also to increase the protein content of the forage produced?  There may be other benefits too, such as drought and disease resilience, and sward longevity.  None of these policy changes is easy to introduce on farm, and none is guaranteed to be successful.  So sound advice (from FCG, of course) and the benefit of others’ experience is invaluable when making such decisions.

Contact Charles at charlesholt@fcgagric.com or your local FCG Office, for help at looking at your business fertiliser options for 2022.