July 23, 2008 - Some dairy farmers could be collecting as much as 37.5 pence a litre under a valuable seasonality bonus scheme announced by one of the country's main co-operatives.

Dairy Farmers of Britain has joined up with Promar to provide members with practical guidance on profiting from the highest autumn milk values in recent memory.

The co-op's seasonality scheme will deliver a bonus of between eight and 12 pence for every litre produced above members' rolling average production base between September and December.

DFB regional business manager Doug Gray says it will make the extra autumn litres worth at least 33 pence and as much as 37.5 pence at the current standard litre base price of 25.5 ppl--impressive, even when most processors are already expecting autumn prices of 30 pence.

Mr Gray says even this incentive may not be enough to persuade many dairymen to switch their calving pattern, given the extra costs and disruption involved. But, he said, it gave a tremendous opportunity for most to improve margins by producing more autumn milk within their existing calving pattern.

"Unless you run an extreme New Zealand milk-from-grass system, you're likely to have plenty of cows in early to mid-lactation from September to December," he said. "In which case, there's a huge amount you can do to increase production. Many herds should be able to comfortably produce an extra one litre a cow per day, if not two, to take advantage of seasonality bonuses.

"And even if it's only by feeding more dairy cake, for most herds that's likely to cost substantially less than the extra value of the milk produced."

Providing herds are not already feeding very high levels of concentrates, senior Promar farm business consultant Andrew Hawkins calculates that average response rates of about one litre of milk for every kg of concentrates will mean an extra feed cost of just over 20 ppl for each extra litre at current prices.