Nitrate banding will act as new quota for dairy farmers – Ifac
Ifac has warned that the new NAP will act as a new quota for dairy farmers going forward, with forced reductions in cow numbers on many farms inevitable.
Coming nitrate streaks could wipe out over 33 percent of dairy herd profits, a new paper by Noreen Lacey, head of banking at Ifac, has shown.
The new Nitrogen Action Plan (NAP) to be introduced this month will increase estimated organic nitrogen excretion rates per cow based on milk yield.
It will shift about 17 percent of herds from 89 kg of organic nitrogen excreted per cow to the next level of 106 kg per cow, forcing some dairy farmers to involuntarily reduce their stocking densities and severely hurt their profits.
In an example scenario presented at the Irish Grassland Association’s annual national dairy conference on Wednesday, a 40ha farmer can carry 112 cows and still comply with regulations.
Before January 2023, the farmer has a stocking density of 2.49 LU/ha, which corresponds to a yield of 6,800 liters per cow and an annual supply of 761,600 liters.
This results in an annual profit of €133,123 for the farmer.
This farm falls under Band 3 in the new banding levels as the average yield per cow is over 6,500 kg.
Consequently, the attributable amount of organic nitrogen from 2023 is 106 kg/cow.
In this scenario, overall profit would decrease by 33 percent.
A mid-term review could also see the possibility of reducing the maximum limit for organic nitrogen in kg/ha under the derogation to 106 kg, depending on water quality developments.
In this scenario, overall profit would drop by a staggering 53 percent based on the farm now carrying 83 cows, compared to the initial peak of 112.
Ms Lacey asked the farmers in attendance to consider dumping poor stock and using contract rearing.
Participants were also advised to lease land, but this comes with caveats of price and availability, and other questions about the financial feasibility of increasing the land area.
“Each of you needs to think: would it be better for my mental and general health if I reduced the number of cows?” Ms Lacey said.
https://www.independent.ie/business/farming/news/nitrates-banding-will-act-as-new-quota-for-dairy-farmers-ifac-42296058.html Nitrate banding will act as new quota for dairy farmers – Ifac