M-Uncaatar Farming, Saturday, September 18,1983 f F A R MANAGEMEN INVESTMENT CONSIDERATIONS Roland Freund Penn State Regional Farm Management Agent In this column last May we dis cussed methods of expanding the dairy herd. the options of rapid expansion and closed-herd expansion were analysed, and the conclusion was that in most cases the slower pro cess with investments staggered over time will be far less risky. Once a modernization or an expan sion program gets to the planning phase, a whole host of possibilities jump (o mind. In recent months I have been looking at construction plans which, if implemented, will result in new debt of more than $6,000 per cow just for cow housing and parlors. Such situations sug gest that our dairy managers are in danger of allowing modem tech nology to lead them down the risky path of overcapitalization. It was too much investment for too little profit that led to the “Farm Crisis” of the 1980 s, and we don’t want a repeat of that in Pen nsylvania in this decade. The profitable farms in this decade will be those which can achieve good production through cow comfort and health, with labor efficiency, capital efficiency, and economical waste handling. There are many ways of doing these things, and every dairy farm has to compromise on some of these parameters in order to maintain profits. Waste handling New legislation has brought this factor to the forefront of the plan ning process. It is important to develop a plan of how this resource will be managed, handled, and used in the total farming operation. Sticking to such a plan can reduce investment in the system, improve crop uptake of nutrients, reduce labor bottle-necks in the spreading process, and minimize storage overflow crises. Cow comfort and health The basic requirements for cows are a clean environment with shade in summer and wind protection in the winter. Deere Introduces (Contlnued from Page D 7) the front of the machine. A bolt-on shield protects the knife mounting hardware from wear, making re moval easy. Impeller conditioning in the ro tary machines features a rotating shaft with a series of free-swing ing tines that move the crop through the machine. Condition ing occurs as stems mb together and against the adjustable condi tioning hood. As the stems’ waxy layer is removed, moisture is al lowed to escape. A single lever permits lowering the hood for more thorough condi New concepts are open and naturally ventilated buildings, rather than the old insulated and mechanically ventilated ones. Careful design can reduce con struction costs and eliminate the need to add costly ventilation sys tems to correct problems which are almost inevitable in enclosed strucures. Labor efficiency and convenience The design of facilites and sys tems will have a big impact on labor. Each component of the sys tem and each task needs to be exa mined to avoid extravagant spend ing on one component or the other. More capital does not always mean less labor. Bottom unloading silos may have some advantages,' but labor inefficiency and operat ing costs have made them obsolete in some setups. Milk in less than two hours? The parlor seems to get the most attention when it comes to labor. In the old days of single family operations, it might have been necessary to “quit work to come in and milk.” So people had good rea son to reduce time devoted to that “chore.” In any dairy with more than two operators, milking needs to be a specific assignment which should not interfere with field operations. Parlor sizing should be based not on the entire herd, but on each group that is to be milked. In high-producing herds with three times a day milking, some suggest that it is prudent to get each cow back to feed in less than one hour. By careful design of par lor and grouping of cows in the housing, such a goal can be accom plished even with quite modest parlors. A parlor which operates four or six hours per milking will be more capital efficient than a big-bucks model which gets the job done in two. Capital or labor In the planning process, it is important jo keep capital and labor expenses in perspective. If capital for equipment and facilities can be obtained at 8 percent with repay ment over 10 years, then a labor saving investment of $86,000 will break even only if it reduces total labor costs by $l,OOO, or more per month. tioning or raising it for lighter con ditioning. Also, the two drive gears for the impeller rotor can be easily interchanged to adjust rotor speed for more effective condi tioning in certain crops. Urethane-roll conditioning, like in the 820 sicklebar machine, is also available in the rotary mod els. The John Deere factory in Ot tumwa. la., is scheduled to begin shipments of the new 800 and 900 Series MoCos in February. More information about the ma chines is available from John Deere farm equipment dealers. This means that, all other con siderations being equal, we are better off if we hire labor for $l,OOO per month than to pay out $90,000 to eliminate it. But if we can save $l,OOO per month with an investent of $BO,OOO or less, then that investment can be justified on the grounds of labor savings. Communal efforts Given the astronomical invest ments in new technology, the small single-family operation runs great risks when it attempts to J-Star Honors Rovendale Ag & Barn Equipment * CARLISLE (Cumberland Co.) —Brenda and Donny Rovenolt of Rovendale Ag and Bam Equipment, Watsontown, Pa., accept their Bronze MVP Award from John Neill, right, president of J-Star Industries. The elite MVP Award (major volume performer) recognizes the company’s top dealers who have achieved gold, silver, or bronze levels of sales and performance objectives during 1992. The presentation took place at J-Star’s Regional Dealer Meeting held in Carlisle. The meeting gave North American dealers an opportunity to hear about new pro ducts, Innovations, and programs which J-Star Industries will be featuring for the balance of 1993. ■■ ■ ■ ■ ■. —^ ■ BUY. SELL. TRADE OR RENT THROUGH THE WI d L=l -M- PHONE: 717-626-1164 or 717-394-3047 FAX 717-733-6058 Mon., Tues., Wed.. Fri. 8 AM to 5 PM; Thurs. 7 AM to 5 PM ■ FARM EQUIPMENT 100CIH crawler loader, ex cellent, $7lOO. 315-536-2141 Yates Co. 10' Miller Offset Disc Level ing Cylinder, Disc Blades 80%. Real Good Condition. $3300. 301-349-5432. 13 ft Krause no-till drill. model 5200, new condi- 18 [UFFLINE HYD. 375 Bushel McCurdy Grav- tion. 717-768-1739. FOILING TANDEM AXLE Bin Wagon w/Fertilizer 1163 MF Com Head, good n ;« n «t aa i r aa rf hin p'SC. ready to good Auger; VicohS Wheel Hay condition; running gew for <#d b !?f T^n v r y r *3900- Rake. Stump Acres. York com head. 21& f 589-4706. 717-665-4743. 717/866-6825. County. (717)792-3216. modernize. But failure .to modernize can also lead to poor profitability and eventual termination of the business. To maintain total independence and rugged individualism may be ideals which will have to be sup presssed for the sake of survival in the future. Extended families and groups of farmers might have to return to business arrangements which fos ter pooling of capital and labor resources for greater efficiency. i V o A Cflb rebuilt oood condition. JD lll s^, del " er ,ree - Sf roHbar wtanow off 2640, 2,5/256 - am SJ: 7 mSTK4 ,B,, “ em «» ,rBC,orB mem and labOTtOTtteltoCtfvflles, but even animal housing and milk ing parlors. Budgets are critical For greater chance of success, every plan requires an open mind and the evaluation of many alter natives. Then careful cash-flow budgeting can avoid making mis takes in concrete. Contact your equal opportunity extension office for technical information and assistance with financial projections. ■ f SV - % «• •