MIKE HUTJENS is an Extension dairy
specialist at the
University of Illinois–Urbana. You can
contact him at firstname.lastname@example.org.
Corn prices continue to decline in most areas of the U.S. with nearly 14 billion bushels projected by USDA. Also, changes in ethanol fuel guidelines and fewer beef cattle may put more pressure on lower future corn prices.
What impact can lower corn prices have on feed costs? If you are feeding 10 lb. of shelled corn per cow per day (as fed basis), lowering corn prices from $6 to $4.50 per bushel can reduce feed costs by 27¢ per cow per day.
Corn silage saving will be impressive, also. If you feed 10 lb. of corn silage dry matter per cow, with current corn silage prices dropping from $60 a ton to $45 a ton, savings can be 23¢ per cow per day. If you feed 20 lb. of corn silage dry matter, that translates to 45¢ per cow per day. Adding both 10 lb. of corn grain and 10 lb. of corn silage dry matter, the total reduction in feed cost is 50¢ per cow per day or 77¢ per cwt. of milk (with 70 lb. of milk yield). This drop in corn prices can represent a 10% reduction in feed costs.
Will lower corn prices reflect in lower forage prices? High-quality legume prices remain modestly high due to the winterkill of nearly 2 million acres in the Midwest and strong exports to the Mideast and China. Legume value is driven by protein content and NDF digestibility.
More on lower feed prices impacts, Extended column
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Low-quality hay appears lower in price and can be impacted by lower corn prices. The University of Wisconsin’s FeedVal 2012 table below indicates high-quality legume hay break-even price is $187 per ton.
Corn silage continues to be a good buy with lower break-even prices. Fuzzy cottonseed had a break-even price at $263 per ton in the model when considering the value of oil, fiber, energy and protein.
Added fat and oil should be fed to high-producing cows (those producing more than three pounds of milk fat per day). Jersey cows producing 60 pounds of milk with 5.0% milk fat or Holstein cows producing 80 pounds of milk with 3.7% milk fat are examples.
If corn is relatively cheap, should I increase the amount fed? If dairy managers have "cheated" on lower starch levels and corn grain fed due to high corn prices, you might want to adjust the level up from 20% to 22% to 24% to 26% starch. Higher levels of 26% to 28% starch corn can be fed, but monitor manure score, milk fat test, dry matter intake, lameness and hoof hardness.
With feeding higher levels of starch, consider the level of effective NDF, particle size of feed, processing of corn grain (micron size and moisture level of corn grain) and feed additives.
Will byproduct feeds in the ration help drop feed prices?
The table below uses corn prices of $6.70 or $4.50 a bushel to compare break-even prices of feeds. The results reveal interesting patterns.
One guideline is a ton of corn silage (as fed basis) can be priced at 10 times the price of a bushel of corn grain at the time of harvest; $4.50 bushel corn results in $45 a ton corn silage at 33% dry matter.
Based on the table data, byproduct feed should drop based on lower corn energy prices, especially corn byproducts. But current reports in the Midwest do not reflect lower byproduct prices, which could be related to strong export markets and favorable break-even prices. Continue to shop for good buys locally.