Issues And Solutions For Rural Milk Production In Australia

Stakeholders and Drivers

Discuss about the Agricultural Scale and Corporate Agroholdings.

Milk production is known to be one of the most blooming rural businesses in Australia. There are numerous dairy farms in Australia that produce billions of liters of milk every year. However, in the recent times, due to modernization in industrial and production sector, the numbers of malls, supermarkets and other outlets for packed and processed foods including milk have tremendously increased. This has led into the deprivation of milk production and profit margin of many milk producing farms located in many parts of Australia. The following report is about the different issues that are faced by rural based milk producing farms and certain steps and actions that can be taken by them to deal with the issues. This has included different reasons that have led to the decrease in profit margins of milk farm owners. The farms owned by a fictitious producer named ArchiFarm have been considered for the study where the need for making production more efficient and cost effective has been focused on. Moreover, the health monitoring process of cows and cattle in order to produce health and protein rich milk has been discuss along with the processes that are used in farm owned by ArchiFarm.

One of the most basic necessities of human in terms of food and nutrition is milk. The farms around any country have the objective of satisfying the dairy demands of that particular nation. The ArchiFarm has been involved into production of milk by automated machines from the cows. According to Cottle et al. (2016, p.389), all the stakeholders and responsible authorities have to work in coordination in order to make the production facilities work in a smooth manner. The major stakeholders and drivers of the milk production business are the Maintenance Operators, Transportation Departments and Contractors as well as Wholesale Contractors. In the Victoria based farm, that has strength of 2500 cows, has its own facilities for maintenance, care and documentations based services units. However, the other smaller production units consisting of 200 cows each located in New South Wales have to depend on external contractors to get the transportation, care and maintenance done.

The overall process of milk production starting from milk extraction to refining, storage and export to different locations is a very expensive process that causes the profit margin to reduce by a significant value. In case of ArchiFarm, it has been observed that there is a scope to enhance the procedures at the workplaces starting from milking from the cows to transportation, where the processes can be made very cost effective. Moreover, this opportunity has been made use of by supermarkets and other stores that focus on selling packed and powdered milk at huge costs to earn tremendous profits that has made the functioning of dairy farms slowed down. As per Charmley et al. (2016, p.175), the catapulting of operations that are currently underperforming, it is very important to make the general public aware of the special facilities that a brand or company is providing and how it is beneficial for them.

Maintenance Operators

The farm owner is the main stakeholder of the dairy production business. Most of the profit is shared by the farm owners and the people working directly this department. The farm owner is responsible for the maintenance and operations of the mainstream milk production business. As stated by Wallach et al. (2017, p.47), the overall supervision of the work is done by farm owners. The ArchiFarm has been using the Precision Livestock farming for recording and financial calculations purposes. Moreover, the Precision Livestock Farming is also used to make every animal contribute towards better production of milk and its healthy living.

In the modern time, the most significant challenge in front of the farm owners is to counter the threat that has originated due to the emergence of supermarkets and malls. Moreover, the lack of awareness among the general population has been one of the most important reasons about the people for not being able to know about the milk that be directly obtained from dairy farms. As mentioned by Nguyen et al. (2016, p.2854), advertising of products along with their benefits and positive factors of using pure dairy products. Hence, the management of ArchiFarm is currently planning for making the production efficient and reducing the overall cost.

The maintenance department or the outside operators that take care of the maintenance in any particular farm are also among the major stakeholders that are involved in the operations of a dairy farm. The responsibility of maintenance operators is to ensure that the operations that are currently ongoing in the dairy farm locations are being carried in an ideal manner. Goulart et al. (2016, p.894) has opined that the cleanliness and looking after the infrastructure is being done as well as monitored by the maintenance operators. In addition, the health of cows and other cattle that are present in the farm is also looked after by the maintenance operator teams. This involves the regular checkup of animals for diseases and some other form of infections.

The Maintenance teams at ArchiFarm are responsible for the testing of milk samples and keeping them separate as per their quality. In case anything unusual is detected in the milk samples that are produced, the cow is tested for any kind of disease or disorder. The quantity of milk along with its quality is constantly monitored for every individual cow. As described by Johnson and Wallach (2016, p.823), if a particular cow produces more than usual quantity of milk, the milk density decreases, which is not preferred by customers. If the milk quantity is less than the desired level of production, it is again a sign of degrading health of the cow. In order to ensure production of ideal milk, it is very important to focus on the food that is given to the cows. Apart from regular fodder like grass and other similar products, chocolates can be very helpful in making the cows produce better quality milk.

Wholesale Contractors, Retailers, and Distributors

The transportation departments are responsible for carrying the milk from dairy farms to authorized dealers and distributors. The farms located at both Victoria and New South Wales have signed contracts with outside suppliers to transport the milk to different locations and outlets. Currently, there are vehicles that use too much of fuel to cover certain distances. Hence, the ArchiFarm management is discussing over the fuel-efficient issue of the vehicles that seems to be a significant factor in the increase of overall cost of production. Wiedemann et al. (2016, p.886) has stated that the transportation vehicles need to be maintained regularly and should be replaced by new ones when old.

In the current scenario, the role of the transportation department is to check that the operations are carried out is such a manner that the fuel consumption is lesser than its exiting value. Moreover, the ArchiFarm is planning to have its own autonomous department of transportation unlike its existing system of outsourcing. According to Rivero and Daim (2017, p.4318), having its own dedicated transportation department for any company is very beneficial as a huge amount of extra taxes and commission that is being paid to the outsourced business.

Wholesale contractors are the people that purchase the milk in huge quantity and sell it further. The wholesaler is an important part of the Supply Chain and receives the products to be sold in wholesale from multiple producers. In the following case, the whole sale contractors receive most of their milk from ArchiFarm. In addition to the Wholesalers, the Retailers and Distributers are also very important part of the Supply chain as they have direct contacts with clients and customers (Taylor et al. 2016, p.599). In this particular case, it is being observes that the people are getting more attracted towards the different dairy products that are being manufactured and provided by contractors and manufacturers working with supermarkets. Hence, the involvement of retailers and distributors is very important in analyzing the reasons behind the inclination of people towards supermarket products.

In addition, the different people that deal with direct clients and customers have to participate actively. The management of ArchiFarm along with all the associated distributors, retailers and wholesale contractors has decided to conduct a survey of people that prefer to have powdered milk over fresh milk and vice versa. Moreover, the reasons behind their preferences have been decided to be analyzed. Garnier et al. (2016, p.79) has cited that majority if the people get attracted towards the processed milks and other dairy products because of the looks and packaging. Moreover, the advertisements of products also play a very important role in making the products famous and preferable among customers as compared to fresh products.

According to the Livestock Management, it is very important for the farm owners to look after the cattle in terms of their health and milk production. The Precise Livestock Farming methods are being popularly used by many farms around Australia. This includes the ArchiFarm too. The health levels and any sign of sickness are detected by some specialized sensors that are attached to the ears of the cows. These sensors make sure that the proper reading is given to the control and monitoring system related to temperature, pulse rate and blood flow pressure of the cows (Plunkett et al. 2017, p.187). In case, the cows are found with some infection and sickness, they are kept at separate cowsheds with some special care and attention.

Proper maintenance of cattle is very essential to make the production more efficient and more deliverable as per the requirements. As per Taylor and Eckard (2016, p.489), the prevention of any disease by the veterinary doctors is a better and comparatively cheaper option than getting the cows treated when ill. Hence, an economic amount needs to be spent on the health care of cows in order to avoid the overall process more complicated and unnecessarily expensive. The breeding of cows is also very important so that the normal production of milk can be maintained. A cow should be made to deliver a calf once is a year in order to maintain the significant level of milk production.

The Milk extraction is done in the ArchiFarm with the usage of milk extracting machines. These machines are attached to the milk producing glands of cows and then the milk is sucked out of their body. The milk is then collected in a container and taken for further processing. The current procedure that is being used in milk extraction process does not include the testing of milk quality immediately after taking it out of the cows’ body. As opined by Jeyaruban et al. (2016, p.981), the milk processing needs to be immediately followed by the testing and purification process. As per the current process of milk extraction, it takes time for testing the milk and if any sample of milk is found to be infected or impure, a whole lot is rejected. This causes wastage of milk and as a result, the producers and farm owners have to either reduce their profit margin or have to increase the cost of their milk products.

Hence, the management of ArchiFarm has decided that new systems will be installed in the milk extraction process. The Livestock Management principles and methods to detect any impurity in the milk will be used. As per Eady et al. (2016, p.221), there are machines that are used to extract milk as well as test the purity levels immediately. There is an inbuilt multi sensor device including lactometer that is attached with milk extraction apparatus. This helps the extracting workers and monitoring people to detect the purity level of milk instantly and reject the necessary amount in the early stage to avoid damage of huge quantity of milk.

In order to ensure proper working of all the facilities at a dairy farm, it is very important to ensure that the supervision of all the works that are being carried out at the different workplaces are is done properly. As mentioned by Cerri et al. (2016, p.2598), the supervision of a dairy farm includes checking of cows’ health and keeping an eye on their milk production capacity. Moreover, the different aspects like cleanliness of cow sheds, looking after the infrastructure and quality of food given to the cows, medicine and other special care for the sick cows are some of the facilities that are supposed to be taken care of while they are ill.

The supervision of all the work processes is properly taken care of at the ArchiFarm in an adequate manner. However, there are some amendments that are supposed to be made in the supervision techniques. The Precise Livestock Farming technology based devices are to be installed to the ears of the cattle. This gives early signals of all the possible internal details like blood pressure, body temperature and heart beats.

The transportation of milk from one location to other inside a country is a very complicated task as it needs to be done with utmost care and precision. As cited by East et al. (2016, p.7), there are some of the vehicles that have got very old and too bad for usage. The management has decided that these vehicles will be replaced and new vehicles will be inducted that has sufficient fuel efficient mileage. The cost that is spent on transportation of milk in a preserved container is very high that leads to the increase in production cost of the overall products.

The new vehicles that have better fuel efficiency have to be I inducted in the transportation sector of this particular business. In addition, the discussion of initiating a self-chain for transportation that is autonomous from the different departments is under the process. Hence, it can be said that the implementation of Livestock Farming technologies in transportation is certainly going to enhance the efficiency of the milk that is produced in the dairy farms.

The efficient Record keeping is very important so that the different parameters and aspects can be easily found and processed. Following are some of the records that are maintained at the control rooms of each monitoring team.

Total number of cows at the Victoria Branch: 2,500

Total number of lactating cows: 2,100

Amount of milk produced by each cow in the farm every day on an average: 10 liters

Hence total amount of milk that produced: 21,000 liters

Cost of one liter of milk: 2.4 AUD

Hence, Cost of total milk produced per day: 2.4 * 21,000 = 50,400 AUD

Total expenses on facilities like transportation, storage, device calibration, testing per day

Cow Food: 9,400 AUD

Milk Extraction: 600 AUD

Storage: 3,000 AUD

Preservation: 1,000 AUD

Transportation: 6,000 AUD

Device Calibration: 400 AUD

Average daily wages to all the workers: 6,000 AUD

Total Expenses for everyday: 600 + 3,000 + 1,000 + 6,000 + 400 + 9,400 = 26,400 AUD

Hence, daily profit for ArchiFarm: 50,400 – 26,400 = 24,000 AUD

In case there are some cows that need medical attention, there will be separate expenses for the cows.

Average cost for medical attention for one cow: 1,200 AUD

Let us consider that there are 10 cows that are sick from the lot of lactating cows.

Hence, reduction in milk production: 10 * 10 = 100 liters

Expenses behind cows for medical attention: 1,200 * 10 = 12,000

Hence, reduction in production sale: 100 * 2.4 = 240 AUD

Total reduction = 12,000 + 240 = 12,240 AUD

Final value of daily profit in case there are 10 ill cows among the lactating cows:

24,000 – 12,240 = 11,760 AUD

It can be seen that the profit margin has tremendously decreased from 24,000 AUD to just 11,760 AUD per day.

These are the essential records that are kept using the Precise Livestock Farming software. The best thing about this technique of recordkeeping is that the only thing a user needs to do is to enter the data inside the required spaces (Wiedemann et al. 2016, p.128). The calculations are automatically done and the important notifications are automatically displayed on the screen

It has been observed in the above calculations that the deprivation in the health of cows lead to the reduction of milk production by a tremendous scale. Hence, the management of ArchiFarm has decided to monitor the health of cows using advanced methods of health monitoring of cattle. According to Hayes et al. (2016, p.906), there are certain techniques used in Precise Livestock Farming that can predict the condition of cows in the upcoming few days. This helps the farm owners to take precautionary steps to ensure that the cattle’s health is taken care of well before time so that the quality and quantity of milk is not hampered.

The milk testing and preservation has to be very precisely done so that the different types of germs and bacteria that are present in milk can be removed. As per Greiner (2016, p.19), one of the most important process to do this is the pasteurization. In this particular process, milk is heated to its boiling temperature and then cooled down to just above its freezing point. This sudden change in the temperature and internal configuration of milk does not give the bacteria to reproduce. This further helps the process of preserving go smoother. If the milk is properly pasteurized, it is very easy for the workers to store it for a longer time and transport it to different locations around the country. Moreover, the different milk products can be made out of the pasteurized milk in a much easier manner than by any other means.

The most important part for enhancing the business as per the current scenario is the contract supply and dealing with other vendors. The different vendors that are associated with the ArchiFarm in terms of business and profits need to come together and study as well as analyze the market conditions very precisely. As stated by Young et al. (2016, p.827), the careful analysis of all the aspects that maneuver the market conditions make it very easy for the farm owners to predict the amount of sale that is likely to happen. In addition to this, the advertising of the fresh and pure milk products is also very important. This will help the common population know more about the different benefits that they are going to experience if they purchase milk from farms instead of supermarkets. The deals with contractors need to be made very carefully so that the terms and conditions of any contract are significantly in favor of both the parties.

In order to ensure the sustainable growth of this business, it is very important for the management level authorities to find the areas that can possibly underperform along with their possible alternatives. This is an important part of the marketing strategy as this helps the owners, dealers and other stakeholders to analyze the risks and make their strategies flexible as per the requirements (Eady et al. 2016, p.227). Moreover, the cost effectiveness of the complete process can be ensured by reducing unnecessary wastage of funds in areas like using old vehicles, outdated machines and heavy software for operations.

The ArchiFarm also needs to keep in mind the Livestock management techniques and fundamentals to maintain a sustainable growth to its organization. In addition, the company has to e very careful about the packaging and some possible discounts for ensuring that maximum possible customers are attracted towards their products. The manufacturing and selling of different varieties of milk products also needs to be done along with attractive packaging. This includes the making of cheese, butter, cottage cheese and many other attractive and healthy dairy products. The packaging should clearly mention all the ingredients used in making the products.

Conclusion

After the successful completion of the study, it can be said that the up gradation of the old techniques of cattle farming and milk production needs to be replaced by the new ones. The report has described the different things that can be used for making the profit margin grow without any kind of compromise in the quality of milk produced by any cow. This has included the different techniques that are likely to be used or are available as an option to be used by cattle farmers and dairy producers. The different stakeholders and drives that directly the firms have been mentioned here along the rules and responsibilities that are performed by them. This report has also included the different business factors and their profit margin on the overall business. The current scenario of the ArchiFarm has been talked about along with the proper alternatives that can be used for making the production more efficient as well as cost effective. The usage of Precise Livestock Farming has been done in order to ensure that the records are being kept in a properly organized manner. This has also included the different calculations related to the recordkeeping of cattle farms.

Reference List

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