Day 10 - Tuesday

theme: Dairy production

     by: Andrew McKenzie-Gopsill, Brad Unruh, Greta Haupt, and Jody Hamers

Plymell Diary which is part of the Dairy Farmers of America (DFA) is a dairy near Garden City, Kansas that milks approximately 1900 head of cattle per day and produces 143 000 lbs of milk per day. This works out to around 3 semi-truck loads per day! The dairy is managed by part-owner Boyd Sigafoose who grew up on an 80 cow dairy operation in the Florida panhandle. Since there was no room to expand the family operation to support more than one family, he moved to the Garden City, Kansas area where his mother was from, with the hope of one day starting his own dairy farm. He spent 18 years away from the industry and worked a variety of jobs, culminating in a position as a service manager for John Deere where he worked for 8 years. It was during his time with John Deere that he was able to find investors who were interested in starting up a dairy operation. He spoke with his investors and pitched his design and business model in November 2002 and secured funding shortly before Christmas. Ground breaking was in March of 2003 and the first cow was milked on October 6th 2003.

Animal Welfare

"No profanity, no cigarette butts on the ground, and if you hit a cow, consider it severance pay" was a quote Boyd's father lived by and was posted on his barn for all employees to see. Boyd said that his father was a true dairy man and Boyd believed in carrying the mentality of a small dairy farmer on to his larger operation. Surveillance cameras have been placed throughout the facility and all employees were aware that they were being monitored to ensure everyone follows his animal welfare policy. Those who break his policy are brought in front of the rest of the employees and fired on the spot with an explanation so everyone understands what happens when they mistreat the animals.

Boyd's philosophy is to place animal care and comfort first, and this was evident from his pen design, maintenance, and condition. For example, all of his pens have a three inch soft pack of manure that Boyd tested himself so that cows can lay down comfortably, and all wet manure is cleaned out daily. Also every pen has 600 square feet of space per cow with 25 square feet per cow under shade. The shade canopies were designed so that the shadow progresses throughout the day and allows the sun to dry out the manure in the pens.

Previously, all calves were custom raised for 120 days at a cost of $2.35 per day however Boyd was unhappy with the quality of animals he was getting back, and decided it was time to make a change. Therefore, he constructed his own heifer raising facility so he could ensure his own standards of animal welfare and health. He designed his own calving hutches where they were able to move freely, though also not coming in contact with other calves, which helps to prevent transfer of illness. The facility has 224 hutches and were designed to be easily and quickly cleaned. He was also unhappy with how the bottles were being cleaned, so he designed his own bottle washer to help reduce the bacteria in the bottles and improve the quality of milk the calves were being fed.

Another aspect of animal welfare that Boyd believes in is avoiding the use of the hormone BST, a naturally occurring hormone that when injected into the cow will result in an increase in milk production. The use of BST has never been allowed in Canada, but is allowed in the United States though it is slowly being phased out by consumer pressure. Today only 30% of dairies will accept milk that has been produced with BST, and this continues to decline. Boyd has never used BST and in the past has received a premium for his milk. While this premium no longer exists, he continues to not use this hormone. He believes that the extra stress put on the animal from the use of BST is unnecessary and instead would rather milk the cow for an extra lactation to get the same final production without the added stress. One way of increasing the longevity of cows is through proper nutrition. He has a nutritionist who visits once a month to balance his high forage rations. The rations for his highest producing cattle consist of alfalfa hay and silage, triticale (a wheat/rye cross), sweet bran, milking premix and corn silage. His milking premix consists of ground corn, cottonseed, soybean meal, Procal (which helps with digestion), sodium and milking mineral.

Boyd runs his dairy as if it was a small family operation and loves his animals even if "the business side can get ugly." He loves farming for the animals and wants to ensure they are healthy and living in the best conditions possible.

Economics

Milk is bought and sold on the Chicago Board of Trade just like any other commodity. The price that you receive for your milk is dependent on three components, fat content, protein content, and other solids, and sold by the hundred weight (100 lbs). Boyd's milk is classified as class 3 milk where the standards are 3.5% fat content, and 2.95% protein content. He therefore received about $15 per 100 weight based on the July prices. His total monthly costs are $1 million and this includes feed, labour, and other overhead costs. Since he is a member of the DFA, he is not responsible for finding customers and only needs to fill his trucks for it to get to market, with DFA deciding where to send the milk.

Unlike in Canada, American dairy operations do not operate under supply management and this allows for investors to get into the market. Boyd's operation has two investors both of which are cash crop farmers who provide him with feed. Day to day decision making is left to Boyd because of his past dairy experience. He does not need to consult with them for regular purchases and only needs their approval for major expenditures. Even if he loses money for a period his investors still make money because he purchases feed from them, which helps his investor's tax position.

Social

The entire workforce on Boyd's farm is Hispanic and they work six 12 hour days a week. Their starting pay is above minimum wage in Kansas, at $8.30/hour and gets up to between $13-14/hour with performance based incentives for the head milkers. With the lack of robotics on his operation he has to be a people manager instead, and this comes with several challenges. First there is a language barrier between him and some of his workforce as well as between members of his workforce. There are other social conflicts between employees that are based on regional differences. However, even with these challenges he is able to maintain a good work environment with low worker turnover.

Future Outlook

Boyd is currently very happy with the size and structure of his operation. Since he has added the calf raising facility his dairy has become a completely closed operation. If he were to expand his dairy he would rather start at a new site than increase the size of his current facility. As for the future of the dairy industry, Boyd just wants to see operations run humanely regardless of herd size. He does, however, see problems with the younger generation lacking experience and refers to them as the "Playstation Generation" in that they rely too heavily on technology and do not have the practical experience of how farming operations work. However, Boyd is confident that the agricultural industry will always survive because, as he says "some eat to live, others live to eat, and I like to eat."