Travelling the globe with health and efficiency

Estonia, Latvia and Lithuania. Dairy farming is not the association most likely to spring to mind on hearing these three names. But that assumption is quite wrong according to Hielke Sportel. The area manager of CRV describes the dairy sector in the Baltic States as ‘a hidden gem’. Taken together, the three countries on the east coast of the Baltic Sea are home to close on 1.3 million dairy cows. Roughly half this number is farmed in Lithuania, while Latvia has around 400,000 cows and Estonia approximately 250,000.

With commercial dairy farms milking an average herd size of 450 cows and with high milk production and accurate registration, the dairy sector is like an elite sport. Sportel visits farms with 2500 cows and milking robots, as well as farms with a herd of 800 that graze outdoors. ‘The farms are just so well cared for here. Amazing. You can almost literally eat off the floor.’ Many of the dairy farms are owned by investors. ‘Estonia, for instance, is known as the “Silicon Valley” of Europe with inventions such as Skype. And what better way to invest your capital than in land?’

The fertile soil found in the Baltic States, however, means that dairy farmers have to compete against the - lucrative - production of arable crops. ‘To safeguard the profitability of dairy herds, dairy farms really have to run a tight ship. Also due to the low prices for milk here’, Sportel says. ‘They often operate against margins of one to two cents.’ Milk production in the Baltic States is therefore at a high level. ‘In the Netherlands, we think that 10,500 kg of milk is already high production, but here milk production of 12,000 to 13,000 kg is quite normal. In fact, Estonia currently has the highest milk production per cow in Europe.’

The key aspect for dairy farmers in Lithuania, Latvia and Estonia is maximum efficiency. ‘The bottom line is that bills have to be paid’, says Sportel. ‘But dairy farmers here operate in a different landscape than their colleagues in the Netherlands and Flanders. Milking a herd of one hundred cows is a very different ball game than a herd of one thousand. That’s ten times higher costs - including for labour.’ The relatively unknown image of Dutch genetics is not a positive when it comes to selling straws of semen. ‘The Netherlands is associated with small farms, small cows and modest production. The Baltic States are far more inspired by the North American philosophy of huge farms that produce unlimited quantities of milk.’

Despite that, the message of efficiency and health is gaining in popularity in the Baltic States. ‘Feed costs are incredibly important here. If a farmer can manage to reduce his costs by 10% by breeding for improved feed efficiency, that is a substantial saving’, indicates Sportel. The same applies to health. ‘On large farms, cows with hoof problems can’t be treated forever. It really is the “survival of the fittest” here. By giving higher priority to health traits, farmers can breed cows that can cope with production and last longer.’

From very small to gigantic. You can find dairy farms in all shapes and sizes in China. ‘The scope covers small farmers with one to ten cows, family farms with up to 500 cows and medium-sized farms with herds of 500 to 3000 cows right up to listed companies that operate gigantic farms with tens of thousands of cows’, is how area manager Bart Dronkert sketches the situation.

His largest client has 250,000 cows, spread over 26 locations. ‘At the largest of these sites, the milk is processed directly into long life milk. The milk processing plant is in the middle, the milking parlour buildings are next door and all around them are barns that can accommodate 2000 cows each. Each barn is divided into sections of 250 cows.’

In China CRV supplies family-run and medium-sized farms through a network of seven distributors. Dronkert’ s main focus is on the very large-scale farms. In China, he was forced to relinquish the Dutch, cow-centric way of thinking. ‘There’s no deliberating about which bull should be mated with Clara 25. On these massive farms, a section of 250 cows is synchronised at the same time. The cows are marked with a stripe along their backs. When the stripe has faded, the cow is inseminated.’

Dronkert also had to get used to the huge numbers. ‘In the Netherlands, we think an order of a hundred straws is a big one. In China, a standard order is 9500 straws, that’s a whole nitrogen tank full.’

China has very serious ambitions in dairy farming, Dronkert explains. ‘The Chinese government wants to reduce its dependency on imports and increase its self-sufficiency. In 2018, total milk production was 32 million tons per year. Milk production is aiming to yield 47 million tons annually in 2025.’

And all of this in a country where good agricultural land is a scarce commodity. ‘Container ships full of lucerne from the USA and Australia dock here. Feed accounts for 70% of the total production costs. So, we have a very solid and interesting offering with our feed efficiency trait.’

The large-scale, Chinese farms are mainly oriented toward American genetic products. ‘Dutch bulls do not have a reputation for transmitting high milk production. Our Chinese clients prefer bulls with a high TPI and milk production index.’ To cater especially for China, CRV acquired 30 bulls in America that match the profile for Chinese dairy farms.

CRV also sells a fair number of doses of Fleckvieh semen in China via its distributors. ‘This segment has seen strong growth in recent years. Family-run farms and farms with up to around 500 cows are the main segment that is switching to dual-purpose herds because milk prices are low and beef prices are high.’

Dronkert is keen to stress that CRV makes a profit on every straw it sells. ‘Some of that goes to the members and part of it is invested in innovations and the breeding programme. As the emerging markets division, our task is to ensure that we contribute to all investments in the breeding programme and in innovation.’

Dronkert is not afraid that China's expansion plans will be at the expense of Dutch dairy farming. ‘There are 1.4 billion Chinese. If their dairy consumption rises by an extra 200 grams a day, you will need 280 million litres of milk on a daily basis to compensate. There is no way we will ever produce that quantity in the Netherlands.’

With its own branch in Brazil, CRV has been active in Latin America for many years. But outside Brazil, area managers Andres Rincon and Wouter Keekstra also sell straws of semen from CRV bulls in countries like Chile, Argentina and Colombia. Last year they sold over 500,000.

Chile is the major client and buys some 200,000 doses of CRV genetics every year. There are around 475,000 cows in Chile. An average dairy farm milks 34 cows and average milk production is in the region of 5600 kg. ‘Many Chilean farmers use a grazing system. So what they are looking for are bulls that are not too large, that score high for fertility and preferably have a dark coat’, Keekstra explains.

The market in Argentina, home to 1.7 million dairy cows, is larger. With an average herd of 168 cows, farms there are considerably larger. ‘Argentina has farms with a grazing system, as well as American-style farms that keep the cows in the barn all day’, Keekstra explains.

His colleague Andres Rincon is mainly active in Colombia, Ecuador and Costa Rica. Sales of straws from CRV bulls increased by more than 30% last year. ‘The circumstances vary widely between farms’, says Rincon. ‘There are farms at sea level right up to farms at an altitude of more than 3000 metres. The majority use a grazing system, but there is also wide variation in the range of breeds used. Some of our clients have the tropical breeds Gir and Girolando, but other farmers opt for Holstein or Fleckvieh bulls.’

Feet and legs and hoof health are very important traits for Latin American dairy farmers because of the long distances the cows sometimes have to walk. They prefer to farm with modest sized, self-reliant cows. Fertility and feed efficiency are also highly valued traits, says Rincon. ‘The high prices of soya and maize are driving dairy farmers to look for cows that can convert grass efficiently into milk.’