Friday, March 29, 2024

Eyes on the prize

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Progressing to farm ownership is never easy, but Taranaki couple Greg and Amanda Bland have a plan. They told Erin Hutchinson they’re on the road to their goals, with a combination of careful planning and a keen eye for an opportunity.
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Taranaki-based variable-order sharemilkers Greg and Amanda Bland have their eyes firmly on the prize of farm ownership – they just need the right next step.

For the Blands, like so many trying to progress through the dairy industry with the aim of farm ownership, finding the right opportunity these days – a win-win for all parties – can be challenging. But Greg and Amanda are not letting themselves get discouraged. Instead they are working towards putting themselves in the best possible position to grab on to that opportunity with both hands.

Analysis they did into what their next step should be, as part of their entry into the 2014 Dairy Industry Awards (DIA) where they won merit awards for risk management and business performance and came third overall in the Taranaki region, highlighted the challenge ahead to reach their goal of farm ownership in the next five years. They compared the equity implications of four scenarios: staying put, a larger (800 cows plus) variable-order sharemilking position, a 650-cow 50:50 sharemilking arrangement, and a 330-cow 50:50 position.

They had been leaning towards the larger variable-order option but crunching the numbers showed that by the time three or four staff salaries were taken into account, relatively little dropped out as profit.

“We did equity growth charts that showed what we would expect to have at the end of each ten-year period. The 650-cow 50:50 just outperformed everything,” Amanda says.

Greg says the difference in equity at the end of ten years was more than $1 million by “going big now”.

“It’s just getting that opportunity. We’re certainly discovering that it’s a fair bit to do with who you know.”

Their participation in the DIA allowed them to benchmark their performance against other sharemilking operators and their success gives them confidence in their ability.

“You apply for all these jobs thinking am I actually going to be good enough? Now that’s not an issue – we know we’re in the ballpark,” Greg says.

“It’s just a case of getting that chance.”

They are not standing idly by, waiting for opportunity to knock. They continue to work on building their equity and developing their existing business.

‘The philosophy was that you were probably putting CIDRs in cows that were probably going to cycle anyway and all you are really doing is shutting them down.’

Taranaki born-and-bred, Greg went dairying straight from high school, but wanting to commit more time to indulge his passion for hockey, he left the industry and spent eight years as a cabinet maker. When Greg and Amanda – an accounting technician – got married in 2001 and decided to have a family, they settled on dairy farming as the way to build a future for that family. Greg got a job as a dairy assistant and within a few months was promoted into a managing role. A managing role on a slightly larger farm followed. In another two years they were lower-order sharemilkers, and two years later they were 50:50 sharemilking 170 cows.

“But we were just too small,” Greg says.

“We were 170 cows and going nowhere.”

They started looking for their next move and were offered several 50:50 arrangements on 300-320 cow farms. They also applied for their current variable-order position on a 114ha farm at Ngaere, near Eltham.

“The financial gains of this job, as lower order on a pretty good percentage with no costs, were higher. So we sold our cows and invested that money in land.”

They bought a 23ha grazing block at Normanby, about 20 minutes away from their new sharemilking home. They sold that block three years ago with the idea of buying a larger piece of land closer to where they were living. A change in their sharemilking contract – they were labour-only but are now responsible for dairy costs, electricity and 24% of the bought-in feed costs as well, budgeted at $0.52/kg milksolids (MS) – put that move on the backburner. However, they have continued to save money in amounts equivalent to what they had been paying for the mortgage in interest and principal.

As variable order sharemilkers, lifting production has been their priority to drive more cashflow for both their business and the farm owners’. Greg, Amanda, and their three children are now in their eighth season at Ngaere, and although the location is the same, much has changed on the farm.

In their first season on the property, they clocked up 83,000kg MS from 280 cows, equating to 295kg MS/cow. Last season, from 320 cows at peak milk, the herd produced 136,000kg MS or 425kg MS/cow.

This season another 30ha was bought and incorporated into the milking platform on September 1. As the new land came into production cow numbers increased by 50 so that peak milk was achieved from 370 cows.

Introducing Jersey into the Friesian herd has improved fertility.

The much lower empty rate created several opportunities. From the farm perspective, Greg got to cull heavily on somatic cell count and production rather than pregnancy status. From the sharemilkers perspective, the Blands got the opportunity to buy 27 recorded weaner heifers that were surplus to the farm’s requirements.

It’s a win-win scenario that puts them closer to their goal of herd-owning sharemilking and ultimately, farm ownership. They also bought another 24 rising one-year-old dairy replacement heifers, hopefully giving them head-start for their herd.

If the right opportunity comes along.

Key points:

Sharemilkers: Greg and Amanda Bland, variable order
Farm owners: Chris and Val Meier
Location: Ngaere, Taranaki
Area: 142ha (increased from 114ha in September 2014) with 20ha runoff
Cows: 370 Friesian-Jersey; was 320 cows
Production 2013-14: 136,000kg milksolids from 320 cows
Dairy: 44-bail rotary with cup removers, Protrack, in-bail feeding.

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