Tom Blanchard - the route to a profitable grass based business

Published 23 October 15

Keeping a firm eye on cash flow, as well as bringing family and staff with him, was crucial to, Forage for Knowledge farmer contributor, Tom Blanchard’s move from a high output to grassland based system.

Tom, milks 380 cows in two blocks of spring and autumn calvers, on a 101.17ha platform near Marlborough in Wiltshire. In 2008, he returned to the family’s high-yielding dairy and arable farm, where the average yield per cow is 10,000 litres.   

The defining moment was in 2010 when the business undertook a full review, which highlighted that cost of production was equal to the milk price.

“We had a really good herdsman who worked tremendously hard for two years, doing all the right things, but profitability wise, we just weren’t getting anywhere. It made us think long and hard about the future direction of the business,” says Tom.

On a trip to Ireland in the autumn of 2011, Tom saw a system which made a lot of sense to him.

“The simple 250-cow dairy unit we saw was run by two brothers and was a pretty profitable set up. There was nothing complex about this system, it had no expensive machinery or shinny toys and no expensive feed lying about on pallets.

“Around this time I also attended the LIC Pasture to Profit Conference and found it quite remarkable to sit in a room with farmers who were making money, and did not moan about the milk price.”

In 2012, Tom joined an AHDB Dairy grassland discussion group in Wiltshire and he started to pay more attention to grazing his low yielding cows. Despite a very wet year and a small grazing platform, the system worked well and a visit to Lydney Park in Gloucestershire gave him further inspiration.

Wilts grassland discussion group

Wiltshire grassland group discussing Tom’s out wintering in December 2013

Tom put a lot of thinking and planning into the business change. An AHDB Dairy Planning for Profit course allowed him to explore the financial implications of both a high-output and grass-based system at the farm. The benchmarking data opened his eyes to the costs within the business and allowed him to explore how much money could be made from both systems, if done properly.

Looking at his existing set up and buildings, and as a tenant not wanting to invest in new buildings and storage, Tom decided a grass based system was the best fit for the farm, and the set-up he wanted. 

In 2012, he started to block up the calving pattern so split the calving, as he wanted to keep his milk buyer on side. In 2013, he sold a few spring calving Holsteins and bought 60 Irish heifers, drilled 32.37ha of grass and put some proper tracks in.

Although Tom knew his buildings were overstocked, running a risk of a problem at any time, the system worked, mostly due to the hard work of the farm staff. After talking to various consultants and visiting a number of farms, he developed a simple paddock and track system.

“Making a system easy and useable are crucial when you are asking staff to adopt a new system. We used this idea when developing a paddock structure and have kept it at the heart of everything we do,” explains Tom.

When Tom came home in 2008 the farm consisted of 36.42ha of permanent pasture, with the rest of the land down to arable. In the 2012/13 season, a lot of that land came out of arable and into quality grass leys.

As the parlour was limiting growth, taking four-hours to milk less than 200 cows, a new 20:40 parlour was ordered in June 2013. This went into an existing shed and Tom used in-house labour for the building work and specialist installers for the parlour. The spend on the parlour was £120,000, including a new tank, which took the place of the old one.

In the spring of 2014 Tom bought another 60 in-calf heifers from Ireland, taking milking numbers to 300 and, again using in-house labour, installed more tracks and water piping

 TB sleeper tracks

Sleeper tracks opened up the grazing block

In 2014, the landlord put a new shed for calving up, enabling Tom to house 300 cows at night at the start of calving.

In August of this year, he bought another group of cows. Bringing herd numbers up to 180 autumn calving and 210 spring calving. As long as things go according to plan, the aim is to be milking 400 by next spring, as culling numbers have dramatically reduced.

Another trip to Lydney Park, this time to look at fodder beet, lead to the development of a key component in Tom’s system. Without enough buildings, especially as numbers in the spring calving herd increased, fodder beet has helped Tom outwinter successfully for the past four years.

The average yield across both herds is 6,750 litres/cow, and the aim is to have 7,000 litres by the end of the winter, with the spring calving herd at 6,000 litres and the autumn at 8,000 litres, on 1.5 tonnes of concentrate (spring calving herd 1 tonne and the autumn calving herd 2 tonnes).

As the initial capital expenditure was large (heifers, parlour, tracks and infrastructure), Tom has had to work hard to keep on top of cash flow.

“We have a good relationship with the bank manager and we’ve made sure to keep him fully informed about what’s going on in the business. It was pretty tight at times but we managed our expansion without extending the overdraft. The key is to monitor the cash flow, almost daily.”

“This means we’ve been able to increase turnover on the same overdraft. We’re looking to consolidate now and bring the overdraft down. The aim is to get everything we do at the moment right before going forwards with the business again.

Since the system move, the culling rate has reduced but probably a higher proportion are the Holsteins in the autumn block. Tom has been impressed by how many of his Holsteins rose to the challenge of the grazing system.

The mastitis rate is down, as it the vet bill.  The feed bill for 380 cows is at the same level as it was five years ago for 180 cows.

“Getting the cash flow right and doing your budgets is crucial. We retained cash in ‘good’ years and used this to fund the expansion (parlour, tracks etc.), meaning we didn’t have to extend the overdraft.

“But just as crucial has been bringing the family and staff with me. My father said grass wouldn’t grow on the farm due to the soil type and dry summers, but a trip to Lydney Park and successful seasons in 2012 and 2013 helped to persuade him.

“At the heart of the grassland system’s success has been our excellent herd manager Stuart Guest and a great team who have worked above and beyond to make it work,” concludes Tom.