Friday, March 29, 2024

Keeping them on their toes

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Reporoa 20% equity managers Ross and Karla Shaw have made significant changes to their farm system this season and were excited to see how they stacked up against their peers in the Dairy Industry Awards.
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It was the third time the couple had entered, this year winning the title of Central Plateau Share Farmers of the Year.

Ross has wanted to be a farmer since he was young enough to reach the pedals on the tractor and has always aspired to win the Dairy Industry Awards. Entering the competition is an effective way to analyse the decisions made onfarm and for farmers to be judged on all aspects of their farm business.

Ross and Karla also won the Westpac Business Performance and Ravensdown Pasture Performance awards. They won the finance award last year when they placed second overall, and were determined to win it again.

They have always focused on low farm working expenses, high production and sustainability, but this year the low milk price has forced them to fine-tune their finances even more, Karla says.

“When you’re looking at budgets and cashflows you’re always looking with a fine-tooth comb, but when you know somebody is watching you analyse them and judging how you do that, it definitely makes your senses heightened.”

The low milk price this season is making farmers re-evaluate their systems to create a sustainable operation that makes sense in a low- or high-payout year.

The Shaw family farm has implemented a lot of change this year, now operating at a System 3, having pulled back from running a System 4-5 during recent years.

Part of Ross and Karla’s presentation to judges was showing the changes they had made and how they had reduced their farm working expenses by $1.19/kg milksolids (MS) from last year.

They also showed how the investment made installing an in-dairy feeding system this season had helped reduce supplement costs by 50 cents/kg MS.

“When we presented the finances this year, it was a matter of looking at how we’d wound everything right down,” Karla says.

Presenting to the judges, they also highlighted the opportunity to make increased gains when the payout increased again.

“And that’s exciting – the gains that can be made at a decent payout.

“We feel we have invested in a profitable and safe business where we can minimise losses in a year like this. It’s good to be able to portray that to the judges,” Ross says.

They want to maintain the focus on profit margin and will look to keep feed costs down, unless there is an opportunity to make money, Ross says.

“We’re always open to spending money to make money.”

Ross and Karla have been in partnership with Ross’s parents, Jim and Helen Shaw, since 2010.

Their goal is to be 30% shareholders by the 2017-18 season and to have paid off a 40% share in 20 years.

They know that to grow their equity they need to grow their business and to do that they need to run an efficient operation every year so they can take any growth opportunities that come their way.

Winning the Ravensdown Pasture Performance award this year reflected that grass is at the forefront of their farming philosophy.

“Our aim here is to fully feed the cows by utilising our pasture. By achieving that, our cost structure is lower,” Ross says.

The focus is on what they can harvest, not what they can grow in the Central Plateau environment.

“We live in a summer-dry, winter-cold environment. You can beat yourself up as much as you want to about growing pasture – we aim to utilise the maximum amount of pasture we can.”

They are on target to harvest 12.5t drymatter (DM)/ha this season, which has increased by 3t DM/ha in the last three years.

That increase is because of new grass species and the use of their C-Dax pasture meter. The farm’s pasture cover is measured weekly in spring, then fortnightly after mating and has been a useful tool to let staff make educated decisions on pasture allocation.

When it comes to growing grass cheaply they spread their own nitrogen, which they mix with gibberellic acid in spring. They have extended the effluent irrigation to 44ha in the pumice block and built a 45-day storage pond.

The storage gives them the ability to irrigate only when there is an economic benefit from putting the nutrients on. The process of competing in the awards can be stressful, particularly with three children and another one on the way, Karla says.

The pair are committed to their family time and family holidays so the hours involved in the competition can put pressure on that, but the rewards are indisputable in regards to business and personal development.

Farmers who enter the competition probably get more personal development out of it than an average dairy farmer, Karla says.

“It’s about critiquing yourself, how can we do that better.”

They always look to implement suggestions from judges and make small changes from the feedback they receive. Comparing their business with other farmers is also a good tool to ensure they don’t get stale working in a family business.

“It’s about keeping us on our toes, because we plan to be here for a while.”

The runners-up were Tokoroa contract milkers Matt and Kelly Fowlie. Rotorua 50:50 sharemilkers, Carlos and Bernice Delos Santos, placed third.

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