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The UK dairy industry has seen a significant increase in average herd size over the past twenty years, with more farmers looking to expand to offset rising costs and stay competitive. Experts predict this trend will continue as farmers try to manage inflation and spread fixed costs over a larger milk output.

Expansion is also being driven by the next generation returning to the farm, as well as the need to increase profitability. However, it is essential to carefully consider the reasons for expansion and assess the financial and technical efficiency of the business before adding more cows.

Before embarking on a growth plan, farmers should check the demand for extra milk from their processor and create a detailed budget that includes potential scenarios such as fluctuating milk prices or increased feed costs. It is also important to explore borrowing options and ensure compliance with regulations regarding infrastructure, such as slurry and silage storage.

When sourcing additional cows, farmers should be cautious of disease risks and consider breeding replacements on the farm to manage timelines and cash flow. Improving grazing and silage management is crucial for a successful expansion, along with assessing staffing needs and implementing efficiency measures.

To avoid common pitfalls, farmers should carefully plan building timelines, monitor cow costs, and accurately assess the number of cows needed to pay back any debt. With the average UK herd size steadily increasing, it is essential for dairy farmers to strategize expansion carefully to ensure long-term success in a competitive market.

Source:
AHDB Dairy and Kingshay Consultants.

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