In July, United DHIA, DRMS, and NC State Extension hosted a PCDart training at Rocky Creek Dairy.  One of the topics that was covered was PCDart’s Money Corrected Milk (MCM) feature and how it can be used in a dairy operator’s analysis of his or her herd.  Several questions came up at the training that I thought would be useful to translate and share with folks who couldn’t make it.

In our skim-fat market today, an important driver in milk revenue is butterfat, so just looking at how many total pounds of milk a cow produces doesn’t really tell us what the value of her production is without correcting for the value of the skim and the fat.  Additionally, more milk doesn’t always mean more money – that depends on how much it costs in feed and other inputs to get that additional pound of milk.  Here’s where the MCM tool comes into play.

Comparing apples to apples or pounds to pounds.  MCM output from PCDart represents the pounds of milk produced, corrected for butterfat and is based on generated revenues for each.  Every lactating cow’s income is calculated from the producer’s milk check data, and the output allows us to compare cows using the revenue each cow contributes to the milk check.   The example in the chart below compares four cows a little over halfway through their second lactations.  When looking at current milk production, cow 27 looks like the least valuable player in this sample.  However, if you correct for fat, cow 27 contributed more to the farmer’s wallet on test day because of her higher fat percentage and its importance in today’s milk check.  In the bigger picture, looking at the 305-day projections, cows 14 and 48 are within 1250 lbs of each other with 48 outperforming 14.  However, when we correct that 305-day projection with MCM, cow 14 is predicted to generate at least 2500 more MCM lbs, which will contribute more to the revenue stream if the trend of butterfat value remains the same as it is today throughout her lactation.

Who’s paying rent and who’s not?  As you know, feed is typically the leading cost driver in the cost to produce a cwt of milk.  Income over feed costs (IOFC) is a popular measure to determine how much a cow is producing in milk revenue over and above the cost of the feed she required to generate that milk.  If you input the data in the MCM feature of PCDart, including the cost/lb of dry matter that you have in your ration(s), PCDart will report your estimated daily IOFC calculated by subtracting test day feed cost from test day milk income.  In terms of targets from 2017, IOFC differentials range from $7.50 to $9.25.  In terms of IOFC output from PCDart, the actual numbers reported as IOFC may not be as important as the general trends or groups that can be identified.  According to DRMS, PCDart takes into consideration the breed, size, etc. of each cow and uses a formula to determine how much feed she consumes and the cost/lb of dry matter that the dairy producer inputs via the input desk.  However, the IOFC output will be a good estimate, but not necessarily accurate to the penny.  Even so, it’s a good reference tool that dairy producers using PCDart already pay for and have access to, so why not use it?

So, if you’re interested in the idea of correcting for fat to compare your cows’ production, as well as the idea of tracking IOFC, here’s how to begin using the MCM features in PCDart.  As a cautionary note, it’s important to remember that PCDart’s output is only as good as the input it receives from the dairy.  It is important to regularly update the MCM input desk, as skim and fat values change, as premiums or deductions on the milk check change, and as the cost/lb of DM changes throughout the year.

The following is a 2-page “Tip Tuesday” sheet from DRMS that walks users through setting up MCM and includes the database items (DBIs) that relate to MCM:

Setting Up Money Corrected Milk in PCDart