Made in America

May 2, 2012 03:19 PM
 
Made in America   Lely and cows

Lely to assemble robotic milkers in Pella, Iowa.

 
The Lely Group, the world leader in sales of robotic milkers, held a grand opening of its Pella, Iowa, assembly plant in late March.
 
The new plant will provide all the milking robots for Lely’s North American market, with its 10 million cows and 55,000 dairy farmers. "North America is the single biggest market for robotic milkers in the world," says Chad Huyser, Lely’s director of operations in Iowa.

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More on Lely Robotic Milking and economics, Robotic survey sidebar


 
Faster delivery times and lower costs are cited for moving assembly from the Netherlands to Iowa. The new 40,000-sq.-ft. assembly plant and office complex sits on the sprawling campus of Vermeer Corporation, manufacturer of a wide range of agricultural and industrial equipment. Lely leases the facility from Vermeer.
 
Vermeer and Lely, both of Dutch heritage, have partnered since the late 1980s. Vermeer has been building Lely forage equipment in Pella since 2003. Lely hopes to assemble a couple of robotic milkers per day, perhaps 10 per week, at the Pella facility.
 
The Lely plant, 40 miles east of Des Moines, is on the western fringe of the robotic milker market in North America, which typically consists of farms with 250 cows or less. But it is closer by a full four weeks on the water and another week through U.S. Customs than the current assembly facilities in Rotterdam.
 
Lely officials are working to source parts, including stalls and computer components, from U.S. manufacturers. "By early 2013, we hope to have all of our local sourcing of parts nailed down," Huyser says.
 
Trans-Atlantic freight savings, U.S.-sourced parts and elimination of international currency fluctuations should all provide savings, says Alexander van der Lely, CEO of the Lely Group, based in the Netherlands. "Hopefully, we can reduce the price of the robots. But before we do, we need to see what the actual savings are," he adds.
 
The biggest savings could come from more robotic model offerings, with features tailored to specific farm needs, says Peter Langebeeke, president of Lely North America. "We’ll see more and more price differentiation as we move forward," he says.
 
The list price for a Lely robot and its computer controls is $225,000. The computer program, called T4C (Time for Cows), is needed to control a series of robotic milkers. Subsequent units cost about $200,000 each.
 
That price tag has sometimes proven to be prohibitive, especially for farms that have several thousand dollars per cow of prior debt. Often, the additional $3,000 to $3,500 of debt per cow for the milking/cow management system is outside the comfort zone of local lenders.

That’s one reason more than 60% of Lely robots are now financed through Agricredit, owned by Rabobank. The Agricredit loans for the machines are asset-based, with the loans tied to each robot’s individual serial number. Terms are generally seven years, with a three- to six-month interest deferral program at startup as producers (and their cows) get used to the new milking system.
 
Van der Lely believes the sky is the limit for robotic milkers. In Europe, with its smaller herds, about a fourth of all herds now use robotic milkers. About 60% of all new milker installations in Europe are robotic, he notes.
 
There are currently 12,500 Lely robotic milkers worldwide, and that number is "quickly heading toward 13,000," Huyser says. About 1,000 of the robots operating in North America are Lely’s, half in Canada and half here in the U.S. 
 

SURVEY SHOWS INCREASED PRODUCTION

Lely surveyed recent purchasers of robotic milkers in North America to gauge cow performance, comparing herd performance from the three months prior to robotic use to one year later. Fifty-seven farms participated in the survey.
 
Before robotic use, herds averaged 66 lb. of milk per cow per day. One year later, with robotic milkers, production climbed to 70 lb. Annual milk production before installation was 20,720 lb. per cow. One year later, it had climbed to 21,777 lb. Milk yield improvement was 6.3% overall, and 11% for herds that had milked 2X without BST prior to installation of the robots.
 
On average, somatic cell counts did not change. However, when herds were segregated by cell count prior to robotic milker use, those herds that had a cell count above 200,000 cells/ml showed a significant improvement, some dropping by as much as 150,000. Herds below 200,000 cells/ml before startup saw no change.
 
Culling reasons changed after robotic use, with slow milking speed and teat placement culls increasing. But fertility and udder health both decreased significantly after robotic milker use.
 
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