And for the beef sector, there’s the opportunity to capture some of the 200,000 to one million calves estimated to be lost from the dairy sector each year.
Firstlight Wagyu managing director Gerard Hickey said dairy farmers can make $100 each for four-day-old mixed sex calves by using Wagyu genetics across their autumn-calving KiwiCross or Friesian heifers and cows. By taking the calf through to 90kg, farmers can make up to $430 for the Wagyu-cross animals this year.
Hickey is hoping this financial incentive will be enough to convince dairy farmers to make the change and to supply calves to the farmer-owned Firstlight Wagyu Producer Group. And as another incentive they can choose to be paid for the four-day-old calves or instead be paid with finished marbled beef of the same value. The meat is hard to get hold of in New Zealand, and considered a delicacy. It sells at more than $85/kg in selected stores.
Hickey said while the company started using Angus genetics across the Japanese Wagyu sires, KiwiCross and Friesian genetics are proving perfect for producing marbled beef too. The marbling is a special type of fat which is held within the muscles rather than between them and has nutritive values with high levels of Omega 3.
“Mixing these Wagyu genetics in a first-cross situation and farming the progeny under NZ pastoral conditions produces an animal with good growth, high meat quality, and a healthy production story second to none in the world.”
At the moment Firstlight’s farmer suppliers are running 2000 Wagyu-cross dairy calves for processing in the next couple of years but Hickey wants to increase that to 10,000 matings this year.
He’s targeting farmers who are currently at best getting bobby returns of $20-$30/calf for their KiwiCross or Friesian calves. Because many of these calves will be out of heifers and very small they’re not often in demand for rearing and nor do they have the five white points favoured by beef finishers.
Firstlight Wagyu is already working with Synlait Farms which has 13 herds of Kiwicross cows. It has split its herds into those cows which provide replacement heifers, and those which are not required to produce replacements, with the latter group being blanket mated to Wagyu genetics using AI.
Hickey is also promoting using Wagyu genetics across heifers, saying that many farmers want to use the smallest bull possible, usually a Jersey bull.
“But there’s no market for these calves. Wagyu also produce a small calf, and although the calf takes a bit longer to rear, it’s very valuable with farmers making $100 for both autumn-born male and female calves.”
Using Wagyu across heifers also solves the problem of accurately identifying the Wagyu-cross calves so heifers can be calved with mixed-age cows.
To make the most of the Wagyu genetics and to build up numbers of finishing animals as quickly as possible, Hickey said he’s promoting using Wagyu bulls on autumn-calving cows and heifers.
Dairy farmers have two options with the resulting calves – they can be sold at four days old to rearers contracted to Firstlight Wagyu, or they can rear the calves themselves to 90kg to be sold to Firstlight Wagyu farmers. Hickey favours the latter option because it ensures the calves receive colostrum and the higher payment gives a greater incentive to rear the calf well.
These farmers also have an opportunity to become part of the farmer-owned Firstlight Wagyu producer group, and share in some of the extra market returns from these calves.
A $430 return for a 90kg calf compares with a $375 return this year for a 100kg Friesian bull calf.
“We are willing to build a platform in the market and we are offering certainty and stability in our prices and contracts,” Hickey said.
“We paid the same prices last year and the year before.”
Firstlight currently has contracts with farmers from Northland through to Canterbury and will become actively involved at calving time too, if need be, employing a person at Synlait Farms to oversee the pick-up of the calves.
“We realise we are potentially adding to a high workload at calving but changing to producing Wagyu-cross calves is also about making good decisions about animal welfare.”
The $23 million PGP has government funding matching that of the industry and aims to deliver economic benefits to NZ of $80m/year by 2025.
