A modelling study of the economic and environmental impacts of integrating forage and cash crops into a Canterbury dairy farm (LUDF)

Abstract

The New Zealand dairy industry has experienced rapid intensification during recent decades in response to increasing land values. Incorporating forage crops on the milking platform is a potential strategy to increase dry matter production and milk production for greater profitability. However, in previous studies, intensification has increased the cost of milk production. This has diminished the low-cost competitive advantage that New Zealand dairy producers have had in international markets. Feeding low crude protein forage crops has also been shown to reduce the nitrogen (N) concentration in cow urine, which may help reduce N leaching. This study used farm system modelling to determine the profitability and N leaching on the 160.1 ha (effective) Lincoln University Dairy Farm (LUDF) when fodder beet, wheat for feed and sales, and a double crop rotation of maize and oats silage was grown. The cash operating profit was calculated using FARMAX® Professional Dairy, assuming $6.00/kg MS. The projected N leaching was calculated using Overseer TM (version 6.2.0), which is now compulsory for all farms in Canterbury under the Environment Canterbury Land and Water Regional Plan. The only crop scenario that increased profitability was fodder beet. Incorporating 10 ha each of spring and autumn grazed fodder beet increased operating profit by 20.0% to $4,782/ha compared to the existing 100% pastoral system ($3,984/ha). The other cropping scenarios had significant decreases in profitability. Incorporating 20 ha of maize and oats silage reduced operating profit by 10.6%, despite increased overall dry matter production. This was due to poor feed conversion efficiency (FCE) and increased feed crop expenses. Operating profit reduced by 3.2% and 13.1% when wheat was grown for feed and sales respectively. The wheat (fed) scenario had similar milk production to the existing scenario, however greater crop expenditure. The wheat (sold) scenario had significantly reduced overall revenue which impacted on profitability. A second simulation with fodder beet was done so than daily intakes were increased to the recommended maximum 6.0 kg DM/cow/day. Harvested fodder beet was included in the rotation and fed at 4.0 kg DM/cow/day during mid-lactation when there was no grazed fodder beet available. The total fodder beet area was increased to 33.9 ha, which increased the operating profit by 34.8% to $5,368/ha. The projected nitrate leaching for the all proposed scenarios increased due to significant nutrient loss from the cropping blocks. The overall N leaching increased from 34 kg N/ha for the existing system to 41 kg N/ha for both the fodder beet (20 ha) and maize/oats silage scenarios. Leaching was 39 and 37 kg N/ha for the wheat (fed) and wheat (sold) scenarios respectively. Leaching increased to 44 kg N/ha when the fodder beet area was increased to 33.9 ha. It was concluded that fodder beet was the only suitable crop to increase profitability, however the projected increase in N leaching will likely prevent the strategy from being implemented.