Are Robots A Solution For Mid-Sized Dairies?

February 3, 2020

Jim Dickrell

Mid-sized dairies, those between 500 and 1,000 cows, are often trapped between an economic rock and a hard place.

They are big enough to require a substantial crew of non-family employees, but not large enough to capture economies of scale or allow employees to specialize. Plus, mid-sized dairies are often challenged to cash flow capital-intensive equipment such as new parlors or other large equipment.

Joel Albright and his parent partners, Fred and Becky Albright, Willard, Ohio, found themselves in such a position four years ago. Their double-16 parabone parlor was re-built in 2011, and truth be told, it was actually a retrofit of a double-4 herringbone that was built in 1975 and expanded twice. They also went to 3X milking in 2011.

The Albrights had been in continual expansion mode since the early 2000s, building freestall barns in 2003, 2011 and 2014. But none were major builds, and after all hammering and sawing was done, cow numbers still totaled about 500 Jerseys. Plus, their land base is limited to 300 own acres and plus another 300 acres farmed on crop share.

The problem was the parabone parlor. “We were at a point of having to do something as our parlor was at the end of its life,” says Joel. “If we built a parlor, we might have had to grow significantly to cash flow the investment.”

So rather than build a new parlor, the Albrights opted for nine robotic milkers and retrofit the robots into the existing freestall barns. “We are hopeful not to have to milk as many cows to cashflow [as with a new, conventional parlor],” he says. “We also thought quality of life would be better for cows and people.

“Long-term, labor availability was also a major factor in the decision,” says Joel. The robots have allowed Albrights to cut their workforce from 12 full-time employees to seven, including Joel and his dad.

The Albrights were already milking 3X in their old parlor. So they did not see a bump in milk production that stall barn users typically see when converting to robotic milking and 3X milking. In fact, the Albrights’ tank average milk production actually dropped a few pounds per cow per day.

That drop in production is mostly due to milking more first-calf heifers. In anticipation of the conversion to robots, the Albrights added 100 more freestalls to one of their barns. With internal expansion, all of those are filled with first-lactation animals.

“The average age of our cows is 37 months due to our growth from 500 to 600 cows,” Joel explains. He anticipates that to increase as cows mature and there is a lower proportion of first-calf heifers in the herd. With a higher proportion of mature cows, he expects daily milk production to increase as well.

Feed costs have also gone up slightly because more expensive energy pellets are being fed through the robots to entice cows into the units. “Feed cost is 20₵ per cow per day higher. Mainly the difference is pulling out farm commodities from the TMR and replacing them with a manufactured pellet in the robot,” he explains.

Labor is the major cost savings with robots, he says. But there are more subtle savings as well. For example, activity monitors on each cow is helping with heat detection and health concerns.

“Our service per conception went from 2.2 to 1.8. So if we are using $30 sex-sorted semen and $10 arm service, there is a savings of $16 per pregnancy,” he says. His herd’s pregnancy rate has also climbed 8 percentage points, from 28% up 36%.

Longer term, he says cull rates should also be lower. “We are able to utilize the animal monitoring system to treat cows sooner where the chance of response to treatment is higher,” he says “[But] the reality is that the labor savings have to pay for the robot cost,” says Joel.

Lenders critical. Because cash flow can sometimes be tight, having a long-term relationship with your lender is essential. “You need to marry yourself with a lender who knows your operation and one who stays with you long-term,” says the Albrights’ lender, Stacy Dvorak, an agricultural account officer and branch manager of Ag Credit, Norwalk, Ohio.

First of all, you need to know your operation’s finances inside and out, knowing cost of production and break-evens. Albrights do, says Dvorak. “I’m not going to tell you it was easy, but what made the project doable is the management and the records this family could bring to the table,” she says. She says she and Joel were able to work out cost/income projections not only for the current year and the next year, but two, three and even five years out to see if the project was viable.

Joel believed he could add the nine robots without adding substantial cow numbers. “[We showed] we didn’t need to do a lot of demolition and new construction, and that we could work with what we have,” she says. That made the project more fiscally responsible.

Other factors. There are also other challenges farmers need to consider when switching to robotic milking, especially if they are going to retrofit the units into an existing facility. Among them:

With robotic milking, cows never leave the pen as a group. So you have to be able to bed and groom stalls with cows in the pen. You also have to have a way to trim feet and treat and dry off cows, and milk fresh cows. Positioning foot baths are also crucial so cows are routinely treated without disrupting cow flow.

Also be aware of operating and maintenance costs of the robotic milkers. “I tell people to budget 1.5 times what they think operational costs are going to be,” he says.

“I would also recommend to farmers that they don’t expect to stretch the limits of robot milking capacity,” says Joel. “Overstocking makes everything difficult and is counter-productive.”