Transcript Kurtland Farms “Our Top 10 Milestones”

Professional Dairy Managers of
PA Annual Members Meeting
Kurtland Farms
“Our Top 10 Milestones”
Tim Kurtz
Kurtland Farms
2006 – Profit Team Start
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CDE Initiative
125 Cows
Prompted by Frustration
Need for Outside Resources
and Guidance
 Quality of Life Important!
2007 – Developed 3-Year Strategy
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Dairy Alliance Initiative
Five-week Hands-on Workshop
SWOT Analysis
Need for Business Plan
Benchmarking
Cost of Production
Needed Answers
 What is the long-term
viability of dairying in this community?
 What is the long-term profitability of current facilities?
 What are the bottlenecks & limiting factors?
 Is there enough land?
 What are other options for the farm?
Immediate Action Steps
 Short Term:
 Ventilation, Sexed Semen, 3X milking,
Written SOPs, Amino Acid ration balancing, Shot program
 Long Term:
 Becoming involved in dairy
industry organizations
 Vital to gain additional
perspective
2009 – Began Expansion Exploration
 Involved Lending Institution,
Engineering Consultant, &
Construction Company
 Environmental grant availability???
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Building site was obvious
Extremely tight budget
Grants seemed only hope
Had to be permitted but not guaranteed
2010 – Denied Waiver
 Required Land Development Plan
 Added Considerable Cost
 Lesson learned: Need highest
level of experience on team
 Jeff Ainslie consulted
 Started 2-year process of designing economically viable facility
 Numerous trade shows, workshops, phone calls, emails and
consultations
2011 – Transformation Team Start
 Focused on challenges
 Assisted with engineering &
permitting costs
 Penn State Extension Feasibility &
Cash Flow Analysis
 Brought clarity and credibility
 Brought new level of energy
2011 – Operation of Satellite
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Adjoining Dairy
Opportunity for additional cows and feed availability
Employees stayed with operation
Allowed for more specialized employee responsibilities
Allowed Us to Keep Replacements & Streamline Labor Force
Within 3 Months of 3X Milking, Added 15 # Per Cow Per Day
2011: Began
Relationship With
Different
Construction
Company
May 2012: Manure
Storage &
Processing Grant
Approved!
June 2012 – Began Relationship
With New Bank
 Financing Most
Challenging Part of Project
 Always Kept Open Lines of Communication
 Explored All Options
September 2012:
Began Construction
Best possible environment
Is It Worth the
Investment?
220 Cow Robotic Free Stall Barn, Manure
Storage & Processing -- Start Up: 3/18/13
Goal: 7.8 million lbs. of milk per yr
Item
Cost
Expansion/Construction Cost:
-- Soft Costs (Engineering, Permitting,
Environmental)
$50,000
-- Barn & Milking Equipment Costs
$2,070,000
-- Miscellaneous Costs
$40,000
Subtotal
$2,160,000
Environmental/Manure Grants
$866,653
Grand Total
$3,026,653
Does Not
Include
Cattle Or
Start-Up
Costs
Robotic Milking: A Natural Fit
 Voluntary milking gives
cow more flexibility and
lowers stress
 Labor skills even more
important
 Enhances positive
consumer attitudes
Composted Manure Solids
• Manure recycled via press
separator and compost drum
• Clean, comfortable stalls are
deep bedded
• Environmentally responsible
• Additional revenue stream
Precision Advantages
•
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Accuracy of information
Detection of abnormalities
Analyzable data
Production Efficiencies
Too Much Information?
Cows have averaged 85
pounds per day for past six
months in robotic barn.
• Need to decide what
information is needed,
when it is needed and
where to find it
• Monitor on a broader level
• Investigate attentions in
more detail
Healthy Cows=Profit
Teamwork=Success
• Many skill sets needed.
• Appeals to next
generation
• Mission statement
values: Profitability,
Quality of life,
Stewardship, Having
Fun, Honor God
Future?
• 100% robotic
• Transition to next
generation of ownership
PATIENCE, PERSERVERENCE,
PERSISTENCE!
Jeff Ainslie
Transformation Team Member
Site Planning / Permitting / Engineering
Kurtland Farms - Take Homes
 Lenders talk about the 3
(or now more) C’s of credit
 In the quest to construct a new dairy facility, we should
be talking about the Four P’s:
1) PLANNING
2) PATIENCE
3) PERSEVERANCE
4) PERMITTING
PLANNING
No offense to the builders -- but the details
of the barn can wait until a landowner
knows what he or she can do where on
their property.
PATIENCE
 7/15/10 Timeline Discussed @ Kurtland
KURTLAND FARM - ROBOTIC FY 2010
DAIRY COMPLEX
July
NMP
EQIP application
CDE planning grant
CDE Digester Grant App
Feasibility update
Stormwater Plan (Twp)
Site Specific Storage Design
E+S Plans
Water Quality Part II
Credit Ownership Determination
PENNVEST Application
August
September
October
November
December
January
February
March
April
May
Oct
DONE
DONE - BE SURE EXTENDED
DONE
DONE - OTHERS?
CDE Digester Grant Dec
Construction Budget Update
FY 2011
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PENNVEST Determination
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OR
Wetlands +/or Nutrient Credit
Proposal to DEP
DEP Determination
Construction (?)
Milking Date (GOAL)
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PERSEVERANCE
 PENNVEST: 4th try was a charm!
 Caernarvon Sewer Authority / Lancaster CD /
others….
 Berks Conservations District came through
PERMITTING
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It is involved…and likely to get more so…
It is complicated…and likely to get more so…
It is different for every project at every location...
It is costly in more ways than one….
Kurtland Farms - Take Homes
 PLANNING
 Headlock dimensions can wait – confirm what you can do
on your property, and what regulations will apply to you
 PATIENCE
 “My excavator is ready….we’re starting in a month” –
unfortunately, you are probably not…
 PERSEVERANCE
 Stick with it and work with people that will help you get
there
 PERMITTING
 It’s a reality – but take the time early on to learn what
rules and regulations actually impact you and your project
Fulton Bank Perspective
From Lamar King
Agricultural Lending in 2013
 Communicate with Your Lender
 Prepare/Budget/Understand Your Financials
 5 Cs of Credit
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Capacity (Cash Flow)
Capital
Character
Conditions
Collateral