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Professional Dairy Managers of PA Annual Members Meeting.

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Presentation on theme: "Professional Dairy Managers of PA Annual Members Meeting."— Presentation transcript:

1 Professional Dairy Managers of PA Annual Members Meeting

2 Kurtland Farms “Our Top 10 Milestones” Tim Kurtz Kurtland Farms

3 2006 – Profit Team Start  CDE Initiative  125 Cows  Prompted by Frustration  Need for Outside Resources and Guidance  Quality of Life Important!

4 2007 – Developed 3-Year Strategy  Dairy Alliance Initiative  Five-week Hands-on Workshop  SWOT Analysis  Need for Business Plan  Benchmarking  Cost of Production

5 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?

6 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

7 2009 – Began Expansion Exploration  Involved Lending Institution, Engineering Consultant, & Construction Company  Environmental grant availability???  Building site was obvious  Extremely tight budget  Grants seemed only hope  Had to be permitted but not guaranteed

8 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

9 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

10 2011 – Operation of Satellite  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

11 2011: Began Relationship With Different Construction Company

12 May 2012: Manure Storage & Processing Grant Approved!

13 June 2012 – Began Relationship With New Bank  Financing Most Challenging Part of Project  Always Kept Open Lines of Communication  Explored All Options

14 September 2012: Began Construction

15 Best possible environment

16 Is It Worth the Investment?

17 ItemCost 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$3,026,653 220 Cow Robotic Free Stall Barn, Manure Storage & Processing -- Start Up: 3/18/13 Goal: 7.8 million lbs. of milk per yr Does Not Include Cattle Or Start-Up Costs

18 Robotic Milking: A Natural Fit  Voluntary milking gives cow more flexibility and lowers stress  Labor skills even more important  Enhances positive consumer attitudes

19 Composted Manure Solids Manure recycled via press separator and compost drum Clean, comfortable stalls are deep bedded Environmentally responsible Additional revenue stream

20 Precision Advantages Accuracy of information Detection of abnormalities Analyzable data Production Efficiencies

21 Too Much Information? 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 Cows have averaged 85 pounds per day for past six months in robotic barn.

22 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

23 Future? 100% robotic Transition to next generation of ownership


25 Jeff Ainslie Transformation Team Member Site Planning / Permitting / Engineering

26 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

27 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.

28 PATIENCE  7/15/10 Timeline Discussed @ Kurtland

29 PERSEVERANCE  PENNVEST: 4 th try was a charm!  Caernarvon Sewer Authority / Lancaster CD / others….   Berks Conservations District came through

30 PERMITTING  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….

31 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

32 Fulton Bank Perspective From Lamar King

33 Agricultural Lending in 2013  Communicate with Your Lender  Prepare/Budget/Understand Your Financials  5 Cs of Credit  Capacity (Cash Flow)  Capital  Character  Conditions  Collateral

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