the case of fully integrated dairy production
Despite huge advances in agricultural technologies over the past few decades, global agricultural systems remain inefficient, based on dysfunctional supply chains that are ill-suited to meet growing demand. Nowhere is this truer than in the dairy sector.
Inefficiencies and Risks
Global dairy production is plagued with inefficiencies and unreliable supply, exacerbated by the restrictions of the pandemic economy. Reduced sales volumes put pressure on margins, forcing farmers to further control costs, while the inability to distribute food globally during this period demonstrated the importance of producing locally. Additionally, a heavy reliance on manual labor has had a negative impact on farms whose labor has faced mobility restrictions and the positive environmental benefits of reduced travel and consumption during the pandemic will only increase the desire for fresher locally produced produce and sustainability.
Take the example of Ukraine: despite its status as the second largest country in Europe, Ukraine’s dairy supply chains are not delivering optimal results. Dairy farming in Ukraine is mainly structured around small dairy farms which produce more than two-thirds of the country’s total milk production – producing small volumes of milk, which they sell to processors for less than $0.40 a liter. There is a constant supply shortfall and low margins, leading to a chronic lack of investment in infrastructure, further compounding the problems. Consequently, despite a 97% self-sufficiency in milk, of the 9.7 billion liters produced, only 3.7 billion liters are processed.
Integration is key
Large-scale integrated dairy farming offers the solution to supply chain inefficiency and risk. Its objective is to produce the highest quality milk at the lowest cost per litre, using the principle of completeness and centralized management to generate maximum economies of scale.
This approach provides “grass to glass” productivity, safety and provenance in the manufacturing and delivery of dairy products. The farm produces grass, which feeds the cows. The farm in turn produces, processes and distributes the milk, thus controlling the entire supply chain and ensuring efficient, profitable and sustainable production.
Effective planning is vital. Locating a feed farm as close to the dairy farm as possible reduces logistics costs and increases margins – for a herd of 10,000 dairy cows, the land requirement would be around 4,000 hectares.
Technology and Scale
Technological innovation is a key feature of integrated farming, with large-scale farming generally centered on standardization, mechanization and continuous genetic improvement of the dairy herd. Automated processes such as cow monitoring and feeding help replace manual labor, optimize efficiency and streamline production and distribution processes.
Real-time monitoring of each cow’s behavior, location, hygiene, health, feeding habits and milk production using collar sensor technology also provides increased productivity and speed . This, in turn, improves throughput, while simultaneously limiting errors and delays and reducing costs.
Thanks to the Internet of Things, machines can be monitored proactively and remotely, 24/7. Artificial intelligence algorithms enable more predictive and advanced systems, reducing system downtime. Likewise, drones, robots, proximity sensors for vehicles, and smart PPE are all helping to improve worker safety and reduce drudgery in dairy plants.
In addition, the use of total mixed rations (TMR) for cows further increases milk yields. Keeping livestock in a carefully controlled and fully air-conditioned environment ensures that each animal is protected from high humidity levels, reduces stress levels and provides access to better feed. This level of environmental control not only means that a greater proportion of energy can be devoted to milk production rather than tending cows, but also improves animal health and welfare and ultimately of account, the quality of the milk.
Furthermore, integrated dairy farming ensures that dairy farmers not only produce milk, but can also safely and cost-effectively generate electricity, using solar and wind energy technology, or by burning biogas. from cow manure. Excess energy can then be sold back to the grid, ensuring full sustainability.
A need to act
Baladna’s commitment to integrated dairy techniques has resulted in a rolling average of 39 liters in our Qatari operations three years after start-up, compared to an average of 13 liters in Ukraine. We continue to bring our integrated methodology to new markets, with new partnerships recently established with the governments of Malaysia and Ukraine. In the case of Malaysia, this will install a herd of 10,000 dairy cows which will provide 100 million liters of fresh milk in the first year of operation.
Governments around the world, especially in the developing world, must do their utmost to embrace integrated dairy farming. This is the future of sustainable and profitable dairy farming.