Reworking New Zealand’s Dairy Systems

[This post was first published in the New Zealand Sunday Star Times on 2 February 2014]

The New Zealand dairy industry has always prided itself as being different. Whereas most other countries developed their dairy industries based on the housing of cows for much or all of the year, the New Zealand industry has always been pasture-based. The cows harvest the grass themselves, the cost of production has been low, and the image was of ‘clean and green’.

Alas, we now know the image of ‘clean and green’ was never quite true.  Although a huge amount has been done to clean up the industry, with fencing of waterways, nutrient budgets and meticulous management of effluent from the milking shed, there is a fundamental problem still to be tackled. This fundamental problem is the concentration of nitrogen in the urine patches which grazing cows leave behind.

The dominant belief amongst scientists is that when a cow urinates she deposits nitrogen in the urine patch at up to 1000 kg per ha.  Not all of my animal scientist colleagues are convinced about this specific number, but regardless of the exact amount, it is inevitable that there will be significant nitrogen leaching from urine patches deposited in autumn and winter.

It does not matter what is done in terms of reduced stocking rate or reduced fertiliser or different grasses. As long as the cows are grazing the paddocks in autumn and winter, then there is going to be significant loss of nitrogen into waterways and underground aquifers.

There are four possible strategies.

The first option is to do nothing. That would mean that the leaching problem would get even worse. But that is not an option because New Zealand society is not going to allow it.

The second option is to allow no further expansion of the dairy industry. That too is not an option because even with no further industry growth there will be further build-up of nitrogen in the waterways and aquifers.

The third option is to force a major reduction in the dairy industry. That too is somewhat impractical, given that dairy exports – which in the current dairy season will be more than $15 billion – underpin our New Zealand economy. Without dairy, we would be in enormous difficulty as a nation.

The fourth option, and it is the only one that makes sense, is to get the cows off pasture from early April until the start of September.

Off-paddock wintering systems can be either stand-off (non-roofed) pads or partly enclosed sheds.  But stand-off pads bring their own problems. There needs to be collection of all effluent, and without a roof over the pad, the effluent pond needs to be at least double the size it would otherwise be.  So in most cases, it means that there have to be roofed sheds.

The appropriate technologies are well understood in both Europe and the United States. Many European countries legislated some decades ago to ensure that cows were held inside during winter, and that the effluent could only be taken back to the paddocks once the soils were drying-out in spring. We now have to adopt and adapt these same systems to work in the New Zealand environment.

Of course there are substantial capital costs associated with these shed-based systems. For a shed that is suitable just for wintering dry cows, then the overall additional capital requirement will be about $2000 per cow. For a system set up to include milking cows, then the cost will be even higher as the cows need to be kept cleaner.

In very broad terms, the total capital involved in a typical New Zealand dairy farming system now exceeds $60,000 per hectare. On a per cow basis, this is typically between $15,000 and something over $20,000 per cow.  So the additional capital of a shed is significant. Also, this shed capital, unlike land, depreciates over time, and so it can add significantly to the cost of production.

Accordingly, it is not surprising that many dairy farmers are strongly opposed to the idea of having to house their cows. Nevertheless, there are now several hundred farms in New Zealand that already house the cows in winter.  We are also starting to see farms, as in the United States, where the cows are housed throughout all of the year.

There are actually multiple benefits that can be achieved by housing of cows. In winter, the animals need less energy to maintain their body temperature, and in summer there is no heat stress in a well-designed system. Cows no longer use energy trudging several kilometres each day to and from the dairy shed.  This walking can also be a major source of lameness. Fonterra has found with its China-based farms that when New Zealand bred cows are shifted to an enclosed system, the total milk production per lactation from each cow more than doubles.

When everything is done correctly, housed cow systems are still compatible with a low cost of production per unit of output and a high return on capital. Indeed the 2013 winner of the New Zealand Dairy Business of the Year – for which I was one of the judges – was for a farm that housed the cows in winter. The key judging criteria were overall return on capital and environmental sustainability.  So it can be done.

Nevertheless, this idea of housing cows in winter is going to be highly controversial. Many farmers will resist the idea fiercely. The general public will also need to get used to the idea of cows being housed. Society will need to be convinced that animal welfare is being dealt with appropriately. In that regard, we can learn a lot from the Europeans.

In the long run, getting cows off the paddocks in the autumn and winter is the only way for New Zealand to go.  It is the only way we can maintain both an image and a reality of ‘clean and green’. But it is going to be an interesting and very controversial journey. It goes against much that we have believed in for a very long time.

About Keith Woodford

Keith Woodford is an independent consultant, based in New Zealand, who works internationally on agri-food systems and rural development projects. He holds honorary positions as Professor of Agri-Food Systems at Lincoln University, New Zealand, and as Senior Research Fellow at the Contemporary China Research Centre at Victoria University, Wellington.
This entry was posted in Agribusiness, Dairy, The Fairfax SST Articles. Bookmark the permalink.

7 Responses to Reworking New Zealand’s Dairy Systems

  1. trlahh says:

    I would be interested to see your views on the potential for biochar as another option. I’m sure you are aware of the historic work at Lincoln on biochar and urine patching. There is a small mountain of published, peer reviewed literature biochar efficacy in nutrient management which I would be happy to share. This should be of interest in NZ in regard to water quality, irrigation and fertilizer use efficiency.
    Regards, trevor

    • Keith Woodford says:

      I have no current views on this.But I am happy to look at the literature to see what is there.
      Keith W

      • trlahh says:

        Keith, probably the most detailed bibliography of biochar research is maintained by IBI…
        Keyword searches on “water quality” “nitrogen” “phosphorus” pull lots of peer reviewed literature. “new zealand” pulls 6 results. “condron” pulls 9 results.
        The keyword tag links from the LHS of the ABE website may also be of interest.

  2. farmerbraun says:

    Your argument seems to be that there is no combination of stocking density (cows/ha/day), soil parameters (exchange capacity , temperature, respiration rate, nitrogen status etc), fertilizer usage , pasture composition (clover % etc) that will not see ” significant nitrogen leaching from urine patches deposited in autumn and winter.”
    This implies that significant nitrogen leaching has been with us since herds of cattle roamed the grasslands and prairies of this planet, and is therefore a natural phenomenon.
    This begs the question of when , or at what level, nitrogen leaching should be considered to have attained nuisance level. In the seeming absence of any hard numbers, it is unlikely that there will be a satisfactory science-based resolution of what appears increasingly to be a rural/urban division.
    It it really impossible that any hard numbers will be forthcoming?
    One would have thought that a year -round dairy operation , employing about one milking cow/Ha , with no spring calving (no winter mob-stocking), using no applied nitrogen fertilizer, buying in no supplements, employing very low stock densities over late-winter/early spring , would not be having significant detrimental effects on ground water from nitrogen leaching.
    Are there hard numbers which say otherwise?

    • Keith Woodford says:

      Yes, significant nitrogen leaching probably has been with us for a very long time and is therefore natural. However, natural stocking rates would have been very low, even in Europe. Also, natural feed would have been a lot lower in protein (and hence N). The system you propose would indeed lead to much lower leaching but it would also of course lead to very low production – maybe 250kg MS per ha or thereabouts with a modern cow on that type of feed, but maybe also less than that, compared to 1500 kg MS or more per ha currently. So where is the milk and protein going to come from?
      Over time the numbers will become more robust, but the big picture is already apparent.

      • farmerbraun says:

        You say ‘ So where is the milk and protein going to come from?’

        It is not clear what you mean. Obviously the milk and protein comes from the forage via the cow.

        The obvious point about the two proposed systems is the difference in the degree of sustainability that each possesses.
        I would argue that the system that I proposed would be among, if not the most , sustainable of dairy systems. That is , in the general sense , of economic, environmental and social sustainability.
        You seem to be of the view that the current high input/high stock density system is not sustainable, and will have to be modified. It will need to employ more capital , and will have higher operating costs. It may also have lower profitability.
        It will be interesting to see if the system that you propose will be economically viable. If it is not , or there are more economic alternatives , such as the one that I propose, then NZ dairying may decide not to go down your suggested path, and may opt instead for a low-impact, low- input, , year-round , added-value, wholly pasture-based system with sustainable profitability.

  3. farmerbraun says:

    The bottom line in all this is that there is nothing in the Proposed Amendments to the National Water Quality Standards to suggest that the wholesale adoption of winter housing of cattle would ever be necessary.
    Regional councils may apply tighter standards where significant improvement is required in a particular catchment, but nitrate in rivers can be an order of magnitude higher before the level reaches the threshold , which is currently set where the river does NOT have to be suitable for swimming in.
    Coliforms are more likely to be the critical factor for meeting the National Standards, and there is no reason to believe that current grazing practice cannot meet that standard without barns , provided that waterways are fenced or have suitable riparian strips.

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