Thursday, March 28, 2024

Farming on Foils

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A Southland couple have used technology, innovation and a lot of tweaking to make their farming business fly. Lynda Gray investigates. Oracle nailed the America’s Cup by sailing on foils. The hull-mounted wings reduced drag and increased speed, turning 20 knots of wind into 47 knots of speed, says South Island Farmer of the Year finalist and sailing enthusiast Neil Gardyne. It’s fitting then that the opening Power Point slide for the farming competition presentation shows Emirates Team NZ’s almost levitating performance. It figuratively describes the strategy Neil and wife Pip have taken on their Otama Valley farm.
Reading Time: 5 minutes

They’ve reduced drag in terms of costs and inefficiency by using foils – technology and innovation to further push profit.

Farm facts

  • Intensive 466ha cropping, bull beef and terminal lamb finishing
  • Flat to rolling downs with 100ha of tussock hill country
  • Equity partnership: Neil and Pip 48% shareholders
  • Emphasis on profit/ha rather than production/ha
  • Use of technology and innovation for greater efficiency

 

  • Stock: 6500 units
  • Sheep: Texel-Kelso composites mated to Poll Dorset
  • 3450 ewes
  • 700 hoggets
  • Cattle: 120 Friesian bulls
  • Crops: 60ha oats, 14ha autumn-sown wheat for dairy support, 12ha barley

 

Key Performance Indicators (2009-2012 average)

  • Av scanning: 171%
  • Av lambing 140%
  • Av kill date: December 20
  • Av oat yield: 6t/ha
  • Av wheat yield*: 14t/ha
  • Av meat/ha: 489kg
  • Av daily lamb growth rate (on ewe): 379g
  • Return on investment: 6.8%
  • Capital gain: 13%
  • Farm costs: 33% of GFI

*First year estimate

 

Key farm practices and innovations:

  • Four day breaks for winter rotation
  • Tailing (only 12% are tailed)
  • Minimal tillage
  • Buy-in of scanned single lambing ewes
  • Tetraploid grasses
  • Spray and pray swedes
  • Use of drone
  • Sheep handling hubs
  • Perkins DrenchMaster handler

Farm costs have never been excessively high but Neil could see potential to further reduce them and increase efficiency. He pursued this cost-cutting goal on a 2010 Rabobank Executive Development Programme (EDP), completing and receiving the award for his Expanding our Horizons project which looked at ways of reallocating time and resources onfarm to reduce workload and increase profit.

“It was definitely a life-changing experience and changed our farm management … now we put time into innovation,” Neil says.

The time and effort has been both satisfying and financially rewarding. Their six-year EBIT average of $1060/ha puts them in the top 2% of the Class 7 farm category and over the same time  they’ve paid off $950,000 of debt, spent $320,000 on new plant while containing farm costs to 33% of gross farm income.

“For us profit is the engine room of our business … production per stock unit is not a primary driver. Our crop yields aren’t the best, our lambing percentage isn’t the best but our combined profit per hectare creates a tidy profit.”

The sheep, cropping and bull-beef mix is well suited to the climate, as well as complementary and flexible.

“We’ve got synergies with sheep, cropping and beef so that we’re mining and recycling nutrients that are free and turning them into cash.”

Their main income is from terminal lamb finishing, the goal of which is to have most away by the start of January. All hoggets and ewes are mated to Poll Dorsets and every year 500 scanned single lambing ewes are bought at the end of winter, their job being to produce a prime weight lamb pre-Christmas and manage spring pasture. The strategy has reduced lambing percentage but increased per hectare returns.

“I think pushing for higher lambing percentages is one of the biggest mistakes because it compromises average kill date and profit.”

As part of the winter rotation the bought-in and home-bred scanned single ewes graze off the 4000kg DM crop of green feed oats grown from the volunteer seeds of the 60ha main crop. It’s a simple and smart double cropping enterprise that contributes to the estimated $1200/ha returns from the single lambing ewes.

The first lambs leave the farm in early December and by weaning in early January 60% to 80% are slaughtered. Most lambs leave with tails on. It’s a policy adopted five years ago and has improved lamb growth rates by 10%. Only the 10% to 15% of lighter weight lambs get a rubber ring.

“They’re here longer so it minimises the chances of animal health issues.”

Spring pasture management is crucial to the smooth running of the finishing system. Ewes lamb on covers of 1400kg/DM/ha but post-lambing covers are screwed back to 1000kg/DM/ha.

Available pasture is reduced by 50% by shifting the single lambing ewes from green feed and the bull-beef cattle from a grazing pad on to grass. Also, 20ha is taken out for brassica crop and, as a last resort, chemical topping is used.

“It’s all about quality not quantity and about letting the light in to grow the clover to grow the lambs at the right time … lamb growth rates are severely compromised by allowing them to graze on grasses that are trying to go reproductive.”

Winter management is based around a four-day shifting policy. It’s a win-win for everyone – pasture use is maximised and sheep are less stressed because they are getting a constant supply of feed and water. The sheep are less vulnerable to pressure which reduces disease risk and it saves Pip and Neil five hours of work each day.

Fast grass

The growing of oats, wheat and barley provides obvious cash-flow benefits but has also fast-tracked regrassing of the farm with predominantly tetraploid grasses.

Neil says on the hill country a swede, cereal, diploid grass rotation has been used and funded from the grain crop.

”We have a negative cost of development of $1000/ha. We’re making money out of developing our hill country.”

A spray-and-pray system is used for growing swedes, the proof of success being the winning of the Southland A&P Society brassica competition with a 21.5t/ha crop that cost 1c/kg/DM.

The establishment process is fast and easy which, after rectification of any nutrient imbalances the previous year, involves a ground spray of glyphosphate and Lorsban followed immediately with the broadcasting of untreated swede at 1kg/ha.

A spray of both Versatill and Gallant four weeks later knocks back thistles and regrowth grass and sets up the crop until grazing. Establishment costs are $206/ha by tractor or $285/ha by helicopter.

“This process takes six hours rather than a week and the swedes use available nitrogen more effectively than with cultivation,” Neil says.

The 130 bull-beef Friesians bought in summer at 130kg LW and slaughtered in mid-April at 290kg have played an important role in helping develop the farm. But they’ll be exiting the system over the next couple of years as more new pasture comes on stream.

The extra space will leave scope for more sheep and crop and further opportunity to bolster profitability.

Skin in the game 

For Neil and Pip equity partnerships have paved the way to bigger and better farming opportunities.

They started farming in 1999 with a 22% shareholding in an 1800-stock unit sheep, beef and cropping farm at Knapdale. Realising that capital growth would require smart thinking they leased land to a lily bulb grower and used the money to speed up farm development.

Neil Gardyne: “You have to look outside your business to look into it but it took me ages to understand that.”

The succession strategy evolved from Pip’s and Neil’s own goal-setting.

“For us succession is primarily about values and culture and preparing the people involved. The assets are secondary,” Pip says.

They have charted where they would like to be five and 10 years on but say it needs to stay flexible.

But what won’t change is the fundamental thinking behind succession: ownership rather than entitlement.

“We want the kids to understand how big the pie is and that they have to work for it. We want them to have a sense of ownership not entitlement,” Neil says.

Their succession strategy is to use the farming business as a platform to instil values in their children – Mark, 13, Ethan, 11, and Esther, 7; so they can be successful in whatever they choose to do.

“Agriculture is promoted but it’s not compulsory.”

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