GMO free soy costs 45% extra. That is the opinion of animal feed expert Henry van Ittersum of EuroKoeIdee. The bonus that FrieslandCampina will pay as of 1 August is 1 cent per liter of milk. In grass-fed rations it is quite possible to earn money with so-called VLOG milk. The less grass in the ration, the more it costs.
VLOG milk is milk produced according to the criteria of the German 'Verband Lebensmittel Ohne Gentechnik'. Cono Kaasmakers and FrieslandCampina have started pilot projects in which several hundred dairy farmers can supply milk produced according to these criteria. Cono has now processed the first non-GMO milk. At FrieslandCampina it will take until August before the pilot starts. The conversion period lasts three months, so that the first VLOG milk can be delivered on 1 December 2017.
Standard soy cheap
Agrifirm specialist Marco van Bohemen has calculated a favorable feed balance of 0,50 cents per liter of milk, if the basic ration consists of 100 percent silage and meadow grass. This despite the much more expensive non-GMO soy that is fed. Non-GMO soy varies in cost price with standard soy not much more than 60 euros per ton to 150 euros per ton. Standard soy is relatively cheap. Forward contracts are concluded for 30 cents per kilo. The fluctuating cost difference with non-GMO soy has to do with the stability of the supply, the quantity, the crude protein percentage and trade factors.
Thanks to the basic ration consisting of (silage) grass, the amount of non-GMO soy on the Dutch pilot farms remains limited. On pasture farms there is no need to look for less expensive alternatives to non-GMO soy. The main alternative is rapeseed meal, which comes from rapeseed cultivation. But in Denmark and Germany dairy farmers experience that you cannot replace the expensive non-GMO soy 1 : 1 with the much cheaper rapeseed meal. Amino acid composition and resistance of soy are unsurpassed when it comes to milk (protein) production.
The Dutch animal feed industry optimizes on these characteristics when composing non-GMO concentrates. In the Netherlands, rapeseed meal also has the disadvantage that the phosphorus content per kilo of protein is much higher. This does not apply to other alternatives, such as 'pure' corn gluten. Potato protein is also offered as an alternative. Lupins and field beans are also gaining in importance, especially in the organic sector.
Will VLOG milk become the standard?
Before the BSE crisis, fishmeal was also a valued source of specific essential amino acids, but there is very little chance that the ban on the use of fishmeal will be lifted for dairy cattle. However, the chance that VLOG milk will also become the standard in the Netherlands, just like in Germany and Denmark, is high. After all, Germany is a major market for the Dutch dairy sector. There are therefore livestock farmers who, when concluding futures contracts for standard soy, make the agreement that the contract will lapse if the Dutch buyer of the milk becomes obliged to comply with the German VLOG regulations.
Note: The terms VLOG and non GMO are both with an acceptance of 0,1% carry-over. GMO free has nothing GMO at all.
© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.