Does It Still Pay to Spread Fertiliser?

^{It’s a fair question. Fertiliser is one of the biggest variable costs on dairy farms, and recent increases have put pressure on margins. However, when you look at the figures, the message remains clear; fertiliser still represents good value on most farms, particularly when compared with the cost of buying in replacement feed.}

^{History repeating itself}

^{This isn’t the first time farmers have faced this situation. In 2021, AgriSearch commissioned AFBI to assess the economics of fertiliser use for grass production, using long-term data from the GrassCheck programme and other grassland research.}

^{That analysis remains highly relevant today. At the time, concentrate prices of around £300/t were used to compare fertiliser use with purchased feed, a figure still broadly in line with current conditions.}

^{The impact of rising fertiliser prices}

^{Fertiliser typically accounts for a significant proportion of forage production costs:}

^{• 25% of grazed grass costs}

^{• 12% of two-cut silage costs}

^{• 18% of three-cut silage costs}

^{A rise in CAN from £300 to £600/t increases forage production costs by approximately £11to £22/t DM.}

^{On a typical farm, this quickly adds up:}

^{• 40 ha grazing platform: +£8,940/year}

^{• 40 ha silage platform:}

^{o Two-cut: +£5,161/year}

^{o Three-cut: +£7,868/year}

^{What happens if you cut fertiliser?}

^{Reducing fertiliser use may appear to save money in the short term, but it comes at a cost, lower grass production. GrassCheck data from 2011 to 2021 shows an average response of 20 kg DM of grass per kg of nitrogen applied.}

^{Using this as a rule of thumb:}

^{• Reducing nitrogen by 100 kg N/ha
→ reduces grass growth by 2 t DM/ha}

^{In practical terms:}

^{• A reduction of 80 units N/acre
→ equates to roughly 4 silage bales/acre lost
(assuming 30% DM and 650 kg per bale)}

^{That lost grass has to be replaced. Increasing supply through extra land is rarely feasible given current prices, while reducing demand by cutting stock numbers is often not an option due to TB pressures and the need to dilute fixed costs.}

^{Buying in silage is another option, but supplies of good quality, reasonably priced silage are often limited and rarely match what can be produced on farm.}

^{In reality, this leaves one outcome, increased concentrate feeding.}

^{Evaluating the cost - benefit of fertiliser application}

^{The analysis carried out by AFBI in 2021 was to compare the relative feed value of grass produced with the cost of the fertiliser.}

^{The calculation assumed:}

^{• Grass, 11.3 MJ ME per kg DM}

^{• Concentrate, 12.5 MJ ME per kg DM}

^{• Concentrate cost, £300 per tonne fresh weight}

^{This equates to a grass feed value of approximately £0.31 per kg DM.}

^{A useful way to assess fertiliser is the grass value to fertiliser cost ratio:}

^{• Greater than 1.0 means fertiliser is paying}

^{• Less than 1.0 means fertiliser is not cost effective}

^{Figure 1: Impact of urea fertiliser cost on grass value to fertiliser cost ratio at three different N application rates}

^{As seen in the graph above, as the price of fertiliser rises the grass value-fertiliser cost ratio decreases}

^{• Urea @ £400/t
→ grass value is 5.7–7.3× higher than fertiliser cost}

^{• Urea @ £800/t
→ still 2.9–3.6× higher}

^{• Higher application rates reduce marginal return
→ but all scenarios remain above 1.0}

^{Replacing grass with purchased feed is far more expensive than growing it with fertiliser. Replacing lost grass with concentrate feed can cost around three times more than the fertiliser saved.}

^{While cutting fertiliser reduces one cost, it increases another, often to a greater extent. This is where many systems lose profitability without realising it.}

^{Liming is a no brainer}

^{A recent webinar by AFBI, Paul Crottney commented “for every pound spent on lime, it’s estimated you get seven pounds back — an incredible return on investment.” Can we afford not to lime?}

^{The bottom line}

^{Fertiliser is currently expensive, but not using it is often more expensive. Replacing grass with purchased feed can cost up to three times more than the fertiliser saved. Growing grass is still cheaper than buying feed.}