Wake up and take notice of what your neighbour is doing, or what they’re not doing, because they might need some moral support.
The current financial pressure on dairy farmers because of the deflated milk price is putting a huge strain on people. Farmers are trying to cut costs out of their businesses, but in most cases their equity is going backwards while their debt increases.
Rural communities in New Zealand need to come together again, King Country farmer Willie Berkers says.
“Be aware of what is happening around you. Is your neighbour doing something unusual, or not doing what they normally do? Go and visit them. Social interaction is good for the soul.
“We all need the courage to drive down our neighbour’s driveway and ask the question if they’re okay.
“Go and poke your nose in and say hello – or ring your area manager. Use your network of people.”
Life moves at a fast pace. Gone are the days when people used to stop for 10 minutes to chew the fat with their staff, tanker driver or neighbour. Instead they are on the go and attached to their cellphones.
With all the communication and technology available, in farming people can still easily isolate themselves during difficult times. It’s easy not to see people for weeks except partners or staff on a daily basis and sometimes the neighbour – but farmers have less to do with their neighbours now.
Schools are another place for people to be aware of changes in behaviour. Sometimes women are forgotten about and they’re often the ones dealing with the bills and budgets and trying to be positive for their family.
“We probably don’t spend a lot of time worrying about how they’re doing. Did they used to always walk their children into school and now sit in the car?”
Willie contacted DairyNZ last year to participate in the Dairy Connect programme. Dairy Connect puts farmers in contact to share knowledge. Farmers interested in joining the scheme indicate what areas they are experienced in, or the areas they would like to learn more about, and DairyNZ puts suitable farmers in touch with each other.
Dairy Connect support or “buddy” farmers have areas of particular strength or experience through development on their own farm.
From 2012 to May 2014 pasture and feeding and infrastructure changes were the two categories with the most connections. However, more recently business has been the category attracting the most connections. This has included topics like goal setting, career progression, financial budgets, cost cutting, succession planning and evaluating business position, for example leasing or taking on a sharemilker or contract milker.
DairyNZ has 415 support farmers in the programme, with 120 more having signed-up to share and assist others as supports in the past four months.
Dairy Connect started in Waikato and has now extended to Northland and Taranaki.
Willie’s biggest piece of advice to farmers is to take ownership of the financial situation they’re in.
Don’t wait until the bank comes knocking at your door – be prepared with a plan. Have a financial and a feed budget, know your income and expenses – know what the numbers are and why.
“You’ve got to own your information. If you don’t understand what it’s made-up of, how can you expect any professional to support you?”
A lot of farmers are struggling to make the right decisions – or any decisions, which is worse. But what can seem really daunting can be pretty simple if farmers work out a strategy and a clear budget.
“Break it down into bite-sized sections.”
Farmers have so much to fight for, Willie says.
“Just roll up your sleeves and get into it. What you’ve got is pretty special and you don’t want it taken away. Don’t spend too much time looking in the rearview mirror – it’s only a fraction of the size of the front windscreen. That’s where your focus should be.”
It’s also important for farmers to take time away from the farm to do the things they enjoy and spend time with their family.
Farmers need to take their partner and children and go somewhere where there is no phone service and no distractions, and have some family time and put things into perspective, he says.
“In times of adversity it’s those moments that become pretty special – you can’t put a price on any of that.”
Sometimes farmers can be fooled into thinking the grass is greener on the other side, he says.
But thinking they would be better off working a 9-5 job in town requires looking at the sums.
There are a lot of people who work to live each week and don’t make any money or grow any wealth.
While there might be a negative cashflow this season, farmers still have capital gain in their favour.
Leaving farming and landing a well-paid job is not guaranteed either.
“In this economic climate there are a lot of other people looking for work.”
It’s a bad time for the industry, but it is important farmers realise the impact the dairy payout is having on other people too, he says.
Farmers can be guilty of complaining about the situation, whether it’s the weather or the payout, but they need to remember they’re not the only ones facing hardship.
“Dairy farmers have to be careful not to be too negative.”
Things are tough in other industries and all businesses could have failures and will be dealing with really hard decisions.
Rural professionals, salespeople, the local shopkeeper, builder or electrician, they will all be hurting in the downturn of the dairy industry, and everybody needs to look out for each other.
“I wouldn’t want to be a rural shopkeeper who is 50% down on his turnover and knowing the position my customers are in. It would be really hard to be in their business.
“Imagine being a rural banker – the rules are changing above them and they have to be the implementer of bad news to people they know are working really hard.”
On his own farm, Willie re-evaluated his operation two years ago. He was concerned his system wasn’t as profitable as it should be.
The farm was split-calving and they were importing a lot of supplementary feed, which was expensive to truck to Owhango.
He got an independent opinion from Topline Ag farm consultant Kate Berry and decided to stop autumn calving and focus on a more simple operation.
“I wanted a robust and sustainable system. I have to be happy to not lose too much at a $4/kg milksolids (MS) payout, but I might not make as much in an $8/kg MS payout.”
Cutting back to a System 2 spring-calving operation makes it easier to pull back in a low-payout season. It’s a closed farming system, with the calves kept at home and the heifers on the runoff.
Willie is focused on maximising the use of the land he owns, through excellent pasture utilisation and making the most of that resource.
Anything he imports into the business has to be adding value, either directly into the vat or into something like cow condition.
He’s done his budgets and set his farm up to be flexible to the volatile dairy market, and is trying not to dwell on the low payout.
Between visiting the dairy farm or his drystock farm at Waitomo, Willie tries to play golf, go fishing when he can, and spend quality time with his family. He also owns the King Country Brewery Company with some friends, which is a great distraction.
