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Dmitrov Region Large Farms

Dmitrov Region Large Farms. Prepared for International Finance Corporation and DokaGene Technologies Company Prepared by Canadian Agro-Sustainability Partnership (CASP - www.caspinc.com) Funding provided by CIDA Trust Funds. Overview.

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Dmitrov Region Large Farms

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  1. Dmitrov Region Large Farms • Prepared for • International Finance Corporation • andDokaGene Technologies Company • Prepared by • Canadian Agro-Sustainability Partnership(CASP - www.caspinc.com) • Funding provided byCIDA Trust Funds

  2. Overview • Objective: To identify farm management improvements and on-farm investment opportunities to bring four large farm operations to new performance levels • Location: Dmitrov District (near Moscow, Russia) • Date: Study duration - April to September 2004

  3. Technical Focus of Study by Farm Unit

  4. Overview (cont.) • Focus Areas: • Potatoes • Dairy/Beef • Swine • Buildings • General Conclusions: • DokaGene farm has greater management and financial capacity and commitment than the other farms • DokaGene/Rogachevo can serve as an ideal example of how to introduce and implement best practices in the subjects under study

  5. Focus Area: Potatoes (Equipment) • Problem: Shortage of spare parts • Solution: $40K of parts purchased from Canada • Effect: Decrease in repair time/down time • Problem: Lack of efficiency due to difficult communication methods with tractor operators • Solution: Supply cellular telephones to appropriate tractor operators • Effect: Improved efficiency and communication

  6. Focus Area: Potatoes (Equipment) • Problem: Storing rubberized equipment out of direct sunlight • Solution: Harvesters, bin piler, etc. moved inside • Effect: Decreased repair costs ($20K annually) • Problem: Increase present transport capacity of hauling potatoes from the harvester to the warehouses • Solution: Secure five more bulk boxes • Effect: Increased harvesting efficiency (15% in far fields) • Problem: Planting small seed sizes • Solution: Use planter cup inserts • Effect: Potential 5% increase in yield • Problem: Sprayers potentially not reaching all areas of all fields • Solution: Sprayers examined and corrected • Effect: Potential reduction of disease

  7. Focus Area: Potatoes (Storage) • Problem: Seed stored at lower temperature than processing • Solution: $180K of warehouse receiving equipment purchased in Canada • Effect: Better storage ventilation and more efficient shipping • Problem: Air flow problems in attic of new warehouse • Solution: Canadian building engineer examined and improved air flow • Effect: Extended storage life ($175K)

  8. Focus Area: Potatoes (Storage) • Problem: Lack of carbon dioxide sensors • Solution: Mobile unit secured • Effect: Increase in value of stored potatoes ($75K)

  9. Focus Area: Potatoes (Management and Worker Skills) • Problem: Potato bruising resulting from poor staff training • Solution: Consultant provided training for key personnel • Effect: Up to 5% increase in marketable yield • Problem: Poor chemical handling procedures • Solution: At a minimum, use chemical resistant gloves • Effect: Improved personnel safety

  10. Focus Area: Dairy/Beef (Crops)Note: Dairy/Beef section includes the work of technical consultants for crops, milking systems, dairy, beef, veterinary science, and genetics • Photos: New (left) and Old (right) Silage Choppers • Problem: Date of harvest of forage crops is too late for optimal quality • Solution: Purchased new machines with greater capacity • Effect: Improved speed of harvest and higher quality forage

  11. Focus Area: Dairy/Beef (Milking Systems) • Problem: Serious milking system and sanitation issues don’t meet minimum industry standards • Solution: Leverage excellent production potential and management support to make substantial milking system improvements. • Effect: Large Russian dairy has given Rogachevo farm a $420K line of credit to improve buildings and buy new milking systems

  12. Focus Area: Dairy/Beef (Milking Systems) • Problem: Excessively low milking ratio for employee to cows (in Canada, one employee milks 25-30 cows; for Russian Farms Under Study, one employee milks 7-9 cows) • Solution: Further investment in staff training and equipment • Effect: Increase ratio to 14-18 cows per worker

  13. Focus Area: Dairy/Beef(General Dairy) • Problem: Storages for forages must be improved • Solution: Repair holes in storage floors/walls with concrete, cover with better grade plastic, remove old forage around bunkers, and improved maintenance of anaerobic conditions in the silo • Effect: • Cost (dozer, plastic, tape, grass seed, concrete): US$5500 • Revenue Improvement: US$30K (300 cows @ US$0.50 x 200 days) • Problem: Silage removal from bunkers • Solution: Use silage face scraper (results in less air infiltration into silage mass during feed out, retaining nutritional value and reducing aerobic dry matter losses. • Effect: • Cost (of unloader): US$4000 • Silage dry matter saved: 8% • Savings on 1000 t silo (350 t of dry matter): US$3000 (30t @ US$100/t)

  14. Focus Area: Dairy/Beef (General Dairy) • Problem: Lost production and extra feed costs due to poor heifer growth • Solution: Chart heifer growth at 3 month intervals and adjust ration accordingly. • Effect: • Heifers should reach breeding age at 14-15 months, so they deliver their first calf at 24 months. • Each month delay represents a loss of US$45/heifer in lost production and extra feed costs. • Problem: Properly balance rations (silage and hay) • Solution: Send samples to Moscow laboratory for full forage analysis package (plus K, Cu, Mg, and solubility analysis). Forward results to Canada for ration development. • Effect: • Cost: US$40/sample analysis • Potential ROI: US$75-100/cow through improved yield and reproduction

  15. Focus Area: Dairy/Beef (General Dairy) • Total Recommended Capital Costs • (400 milking cows) • $253,000 (Milking equipment) + • $382,500 (Building renovations) = • $635,500 (exclusive of genetic improvements) • Return On Investment > 35%

  16. Focus Area: Dairy/Beef(Genetics and Animal Health) • Problem: Small cow size and poor conformation resulting reduced ability to produce milk • Solution: Improve genetics utilizing Modern Canadian Sires and Embryo imports and implantations. Embryos ($20K) implanted July/August 2004, Canadian Semen ($8K/year) introduced July 2004, plus new AI equipment and supplies ($2K) • Effect: Improved milking potential from 6000-7000 kg/cow in 2 years to 7000-9000 kg/cow in 5-6 years

  17. Focus Area: Dairy/Beef(Genetics and Animal Health) • Problem: Significant parasite burdens present in all ages of cattle • Solution: Regular deworming program for all ages of cattle and for milking herd once yearly (US$5K per year in anthelmintics / Fall’04 purchase) • Effect: Up to 8% increase in milk prod’n • Problem: High incidence of Enzootic Bovine Leucosis (EBL) • Solution: Initiate EBL Elimination program. Improved hygiene with treatment protocols ($15K/year – implemented August 2004) • Effect: Ability to sell quality breeding stock in future • Problem: Calfhood disease high • Solution: Provide cold housing and calf hutches (40 hutches = $8K / Fall’04 purchase) • Effect: 5% increase in milk production as cows • Problem: High levels of enzootic pneumonia in replacement heifers • Solution: Provide modern housing for calves and heifers. Implement vaccination programs. Improve treatment protocols. • Effect: New health management protocol introduced (Aug’04). Up to 5% increase in milk production

  18. Focus Area: Dairy/Beef(Genetics and Animal Health) • Problem: High levels of mastitis and cows milking on two and three quarters • Solution: Institute program of Dry Cow therapy, invest in high quality antibiotic therapies for treatment of mastitis cases ($8K/year – implemented August 2004) • Effect: Up to 20% improvement on current prod’n • Problem: Cattle are horned, creating risks to farm workers and injuries among cattle • Solution: Dehorn all young calves in future before eight weeks of age; apply rubber bands to young heifers and bred heifers; remove horns from adult cattle ($200 for dehorning equipment – implemented July and September 2004) • Effect: Increased safety for workers; elimination of horn injuries by dominant cows

  19. Focus Area: Dairy/BeefRecommended Sequence of Improvements • 1. Management skills, hygiene, and human resources development • 2. Forages, equipment and quality • 3. Nutrition program improvements • 4. Housing for calves and heifers • 5. Milking equipment including parlour etc. • 6. Initiating genetic improvement program, semen and embryos • 7. Housing (building) renovations for milking herd.

  20. Focus Area: Dairy/Beef(Conclusions) • Excellent potential and management support to make substantial milking system improvements • Rogachevo farm ideally suited for beef production to add value to forage and grain crops used in rotation with potatoes • Large pastureland base provides opportunity for purebred and commercial beef cow herd, providing feeder cattle for beef finishing and breeding stock as calves, embryos, and semen for other beef producers in area • Market Potential (fresh beef - Moscow region): • 5000 tonnes/year [15,000 cattle] • Wholesale Price: US$3.00/kg [dressed weight] • Return Yield: US$1130/cow

  21. Focus Area: Swine (Potential) • DokaGene has significant strengths for Swine Production and, aside from a small number of solvable problems (see next slide for details), could become a Russian market leader in pork, as it has in potatoes.

  22. Focus Area: Swine(Strengths and Weaknesses) • Strengths • Access to foodstuffs, potato byproducts, and other byproducts • Access to croplands for optimal manure disposal • Access to a population of 12 million people in Moscow market • Solid reputation as source of innovative agricultural technology • Potential retail partner in a growing supermarket chain • Strong demand for live pigs and few competitors entering the business • Weaknesses • No buildings are currently suitable for swine housing - new buildings are required • No packing industry partner

  23. Focus Area: Swine(Building and Breeding Stock Costs) • US$13 million (2003 estimate) would be required to create the buildings for the production system including some road work, utilities, and well (does not include feed system or manure spreading equipment – concept would be to include a manure cover to minimize odour from the site) • US$1.95 million would be estimated breeding stock costs

  24. Focus Area: Swine(Potential Business Concept) • Years 2-3 • Build one 1,200 farrow to wean barn • Build three offsite finishing locations for growout of market hogs • F1 females and using Duroc sires • Create Boar stud – 30 boars and expandable for semen sales • Investment US$6 million (unless Russian material costs are lower) • Output 24,000 market pigs per year (2,300 tonnes per year) • Year 1 • Breeding stock unit 300-500 sows • Single site, farrow to finish • Populated by Purebred genetics – Yorkshire, Landrace for female line Duroc for sire line • Create F1 gilts and Duroc boars for sale and for creating commercial herds • Test Russian slaughter markets and prove Canadian genetics • Build using Canadian technology and search for Russian suppliers of building supplies and barn technology. • Investment $1.5 million • Output 4000 market hogs (3000 tonnes/yr) • 1,500 breeding F1 animals and boars for sale and/or setting up commercial herds

  25. Focus Area: Swine(Potential Business Concept - cont.) • Years 3-5 • Build a second farrowing unit 1,200 sows farrow to wean • Three more offsite finishing • Investment US$5 million • Output another 24,000 market pigs per year (2,300 tonnes per year) • Long Term, if deemed a successful venture, DokaGene could: • Expand in 1200 or 2400 sow units using original herds as showcase facilities • Provide construction and consulting services • Provide management services to run production for other growers

  26. Focus Area: Buildings • Beef • Problem: Buildings assessments for future beef production • Solution: Barns at Ivanovskyoe, Aleksanderovo, and Rogachevo Farms could be renovated for a reasonable cost • Effect: Space could be provided for over 1000 head of beef cattle

  27. Focus Area: Buildings • Problem: Existing milking system is obsolete and must be replaced • Solution: Plan developed for renovation: renovate connector building between the two barns install: double 9 parallel pit milking parlour (expandable to a double 12); bulk tank room; utility room • Effect: The above solution is the most cost-effective way to ensure a high quality milk production system. • Dairy • Problem: Structures to be repaired/adapted for dairy • Solution: Repair bunker silos at Pokrovskoye and Ivanonskoye; Renovate hay barn at Pokrovskoye to serve as feed assembly and mixing area. • Effect: Silos will hold required silage for dairy; hay barn to be used for proposed future Total Mixed Ration (TMR) feeding system

  28. Focus Area: Buildings • Problem: Buildings for cows • Solution: • Steel truss building will be renovated for the following usages: house dry cows, close up cows, maternity pens, milking area for fresh cows, forty hutches for female calves • Male calves may be raised as part of the future beef enterprise • Kachergino remains basically as is and will become an isolation facility for bovine leucosis-free cows and calves.

  29. Focus Area: Buildings • Potatoes • Newly constructed above-ground storages are superb • Problem: Old style underground potato storages are of limited use without reconstruction • Solution: Restore and renovate old storages using Canadian technology and know-how • Effect: Extended life of old storages before their eventual phasing out Photos: New (above) and Old (below) Potato Storages

  30. Focus Area: Buildings • Other • Problem: Manure management • Solution: Manure storage improvements and environmentally friendly manure management will be a requirement in the future. Recommendations were made regarding improvements to livestock barns and manure management systems

  31. Conclusion • CASP was able to identify many low-cost and effective improvements involving management, training, and other non-capital investments which can quickly improve output and profitability of all farm operations under study. • In the longer term there needs to be substantial new capital investment, but many initial improvements have already been undertaken at minimal capital cost and provided a significant return on investment. • The DokaGene farm in particular has the potential to be a commercial showcase facility in dairy/beef, swine, and other farm operations as it already is in potatoes.

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