Dairy Exporter August 2022

August 2022

Learn, grow, excel

Looking out to Dairy2032 Contract milkers: Are you earning a premium over a manager’s role?

Young Country: From the Ground Up podcast EU Free Trade Agreement: Searching for high value market segments

AUGUST 2022 $12.95 incl GST

Counting on cows What’s the outlook for cow values and can you still bank on them?

$12

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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Protect your herd and the next generation

Use Bovilis BVD for 12 months of proven foetal protection1. The longest coverage available.

Exposure to BVD could mean your unborn calves become Persistently Infected (PI’s) - spreading BVD amongst your herd. It is estimated that up to 40% of dairy herds are actively infected with the BVD virus at any given time. The convenience of the longest coverage available along with flexible dosing intervals2 means you can protect this season’s calves no matter when they are conceived.

Avoid an outbreak. Ask your vet about vaccinating with Bovilis BVD or visit bovilis.co.nz

Following a third dose (annual vaccine) Bovilis BVD provides 12 months foetal protection. 2Interval between dose 1 (sensitiser) and dose 2 is from 4 weeks to 6 months. 3rd dose given as annual single dose.

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AVAILABLE ONLY UNDER VETERINARY AUTHORISATION. ACVM No’s: A011866. Schering-Plough Animal Health Ltd. Ph: 0800 800 543. www.msd-animal-health.co.nz Copyright © 2022 Merck & Co., Inc., Rahway, NJ, USA and its affiliates.

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

CONTENTS

Page

32

MILKING PLATFORM 10

Suzanne Hanning finds onlookers stuck in the mud in Southland

11

Trish Rankin’s family finally have a place of their own in South Taranaki

12

Hamish Hammond adapts to the nitrogen cap

13

West Coaster Richard Reynolds has an obsession with gravel

Page

38

UPFRONT 14

Realpolitik in world dairy markets

18

Canada: North America’s dairy dispute

20

Market View: Peeking over the farm gate

Page

12

BUSINESS 22

Being prepared for moving in and getting out

25

Contract milkers miss out on premium

27

Future farming: Farmers must be in the driver’s seat

28

Technology: When the world makes sense

30

Governance: Two terms with Donna Smit

32

Pellets and Pakihi in the Takaka Valley

36

Farming profitably among the rocks of Golden Bay

SYSTEMS 38

Southern Dairy Hub: Wintering with grass and balage

40

Look, no fences for Pete Morgan

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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ENSURE THEY REACH THEIR PEAK POTENTIAL The essential building blocks for optimal health including vitamin B12 in one convenient injection.

BOE 1063

Ensure young stock become future high producers through improved health, growth and energy at:

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futureproducers.co.nz

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

Page

80

Page SPECIAL REPORT: Cow values

44

44

Cashing in on cows

50

A widening quality gap

52

Eliminating bobbies: A pan-industry requirement

55

Cow value: is the dream runover?

58

Live exports: Surplus calf values set to crash

ENVIRONMENT 60

Ballance Awards: Wintering better

63

Wintering well sets up calving

STOCK 64 66 70

Vet Voice: Prioritising colostrum Calf rearing: The importance of colostrum Rotavirus: A calf-killer

75

Finishers and dairy farmers benefit from superior beef genetics

78

Beefing up the calf crop

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

YOUNG COUNTRY 80

‘I call myself a fishmonger’

RESEARCH WRAP 82

Future systems for Northland dairy

WELLBEING 84

Yarns that save lives

DAIRY 101 86

That sign at the gate

SOLUTIONS 88

MaxCare extends calf feed range

OUR STORY 90

50 years ago in the NZ Dairy Exporter

Page

66

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DAIRY DIARY August 14 – Applications close for 2023 Nuffield New Zealand Farming Scholarships. To find out more and apply, go to ruralleaders.co.nz/nuffield August 17 – Habits for Success is a live webinar that explores practical tips and real stories to build a resilient platform for success in an environment where things constantly change. Delivered

by ASB and Dairy Women’s Network, it runs between 12.30pm and 1.30pm.

To register go to register.gotowebinar. com/register/1583525866467982096 August 30-31 – DairyNZ is holding two cropping field days in Northland to help farmers plan for the season ahead.

Maize, summer crops, nutrients and weeds will be discussed at Waipapa on August 30 and Glenbervie on August 31. Visit the DairyNZ events page or contact Stephen Ball on 027 807 9686.

September 27-28 – DigitalAg 2022 is being held at the Distinction Hotel in Rotorua. The former MobileTECH Ag brings together technology leaders, agritech developers, early adopters and the next generation of primary industry operators. The real innovation now is in digital platforms that capture realtime data and convert it into practical information that drives productivity. To find out more about the event and to register, go to agritechnz.org.nz/event/ digitalag

September 29 – Lincoln University Dairy Farm focus day with a focus on mating, managing costs and inflation.

The day begins at 10.30am. Visit www. ludf.org.nz/events October 1 – Entries open for the 2023 Dairy Industry Awards and registrations of interest can be made at www.dairyindustryawards.co.nz October 2-7 – World Dairy Expo 2022 is held in Madison, Wisconsin, United States. Find out more about the expo at worlddairyexpo.com October 6-7 – The New Zealand Landcare Trust is hosting the National Catchments Forum at Te Papa Tongarewa in Wellington which brings together speakers with knowledge and experience in catchment management.

It looks at water reforms, integrated farm and catchment planning, and how catchment groups are addressing the climate challenge. For more about the forum visit www.landcare.org.nz/eventitem/national-catchments-forum October 28-30 – Waikato A and P Show is held at Claudelands Showgrounds. Visit waikatoaandp.co.nz October 30 – Applications close for the first 2023 Kellogg Rural Leadership Programme at Lincoln which is aimed at developing leaders for the rural and agri-food sector. For more details and to apply visit ruralleaders.co.nz/kellogg

November 3 – Reprogram – Charge the Brain is a webinar run

by ASB in partnership with Dairy Women’s Network. It looks at the neuroscience of attention, memory and energy to help with busy lives and increasing change. To register go to register.gotowebinar.com/ register/1687105359498338318 November 9 – The New Zealand Agricultural Show is held at Canterbury Agricultural Park in Christchurch. Livestock entries are open. For more information visit www.theshow.co.nz November 15-17 – The NZ Grassland Association’s annual conference takes place in Invercargill. For the first time the conference will be held in conjunction with both the Agronomy Society and the NZ Society of Animal Production, enabling it to cover most research aspects of New Zealand agricultural systems. A highlight of the conference is a tour to the Southern Dairy Hub. For more information and to register, visit www.grassland.org.nz November 30 – December 3 – Fieldays is a summer event this year at the Mystery Creek Events Centre near Hamilton. For details visit www.fieldays.co.nz

TALK TO THE EXPERTS FOR FARMING SUPPORT 07 858 4233

Support for calf scours

farmservices.nz info@farmservices.nz /HomeopathicFarmServices

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HOMEOPATHIC FARM SERVICES Dairy Exporter |

/HomeopathicFarmServices

www.nzfarmlife.co.nz | August 2022

STRONGER Editor’s note

TOGETHER

S

taying strong onfarm portrays an innovative programme run by Reporoa dairy farmer and cancer survivor Sarah Martelli, who helps other women find their balance and build strength and wellbeing to be the best they can be.

Strong Woman is an online community for women to work on their fitness with a workout to do at home, find quick and easy healthy recipes, goal planners and to connect with other women on the same journey.

Her philosophy is to help women create healthy, sustainable habits around moving and feeding their bodies and their families.

If women can prioritise their own health and fitness, they can inspire their partners, their children and their around them, Sarah says (p82). t’s been a well worn path for manycommunity years some figures through She is an inspirational woman in the dairy industry - and one that has the contract milker creating a moment of lift for many women. Calculator helped thousands of sharemilkers into Premium In this issue we take look atisthe regenerative agri their first farm - trading cows and building to see if thea reward journey some NZ farmers are already on, and that the equity - along with what could be described there. The calculations government has signalled they wantaothers to join in on, as the final push for the summit - selling can also be used to start in our Special Report. down half the sharemilking herd for the conversation with the farm The regenowner debate(pg has25). divided the farming community first farm deposit. in a big way many scientists are affronted But many factors have combined to put Colostrum management and that NZ would need regenerative methods from overseas countries with more obstacles in the well-worn path and rotavirus are top of mind for our highly degraded soils would that then infer in our Special Report this month we look contributing vet Lisa Whitfield that our conventional methods were degenerative? at what’s happening to the price of cows and with the latest research from the They say the methods won't work, and that(pg research and whether the end of live exports and Poukawa OnFarm Research team 64) has already and shown that, and also farmers are already shutting down of farm conversions has Jason Archer fromour Beef+Lamb gives following regenerative practices.

Others say that the burst the growth in equity through cows. some great advice on how to select the methods areright not prescribed each farmer can take Siobhan and Chris O’Malley have made beef bull toand breed some valuable dairy out of it what they want.

It has been called a social it work this season, moving to their first beef calves (Pg 78). a science the claimed benefits farm on the West Coast after years of movement rather Beefthan consultant Boband Thompson looks of improved soil and stock health and building soil trading cows and scrimping and saving out to a time when it will be mandatory through diverse species, of biological something that was certainly not fast carbon or to make every calf a use valued calf - andfertilisers and laxer and less frequent grazing practices along with easy. They suffered burnout on the way, he puts forward a scheme to categorise less nitrogen is something that resounds emotionally and even exited the industry for a time, non-replacement calves to give calf rearers with many. assurance around the value and quality of but their burning passion for dairy brought snapshot of thinking by scientists in them back, and fired up their dream of We have taken those acalves (Pg 52).

MPI and DairyNZ (p46) and portrayed farmers farm ownership. They even had their For something different, what give our new using the practices are finding, including ongoing coverage children involved in money discussions and podcast series a like and a listen. First up, of the comparative trial work

by Align Group in chat Canterbury colouring in the savings chart. Read about the Young Country podcast team to a

HURDLES ON TRADING ROUTE

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their journey on page 44. young Chatham Islander who built a great Experts we talked to say it’s definitely food business selling kai moana from the not impossible, but you need a longer time rich seas around the islands. There are lots Dairy Exporter | www.nzfarmlife.co.nz | June 2021 horizon to build equity as land prices have of other great young people in the sector increased faster than cow prices - whereas building businesses From The Ground Up in 1992 you used to need to sell 14 cows so watch out for them too, to buy a hectare of land, now it takes on average 30 cows.

Taking a step down the progression ladder we take a look at the premium contract milkers should be making over a managerial salary. They need to be rightly rewarded for the risk they are taking in setting up their own business, and they can now run

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

(p42). We also cover the Heald family of Nors (p52) who have transitioned to organics, OAD philosophies and are enjoying the less intens more resilient system they have moved to, alo improved profitability.

There is more research to be done in the NZ system context, says MPI’s chief scientist John figure out what will and won’t work, but he e farmers to engage and learn more, and to em regenerative as a verb - saying all farmers cou be more regenerative, more resilient, lowering and building carbon storage.

If you are interested in getting into farm ow getting out but retaining an interest, read abo Moss’ innovative idea for a speed-dating week potential partners (p11). We think it could be

NZ D

@Yo

@Da

@nzd

Sneak peek

JULY 2021 ISSUE In the next issue: • Special Report: September 2022Farming/business investm – if you are starting out or bowing out.

• Diversification • Wildlife onfarmonfarm - could you go bananas?

• Ahuwhenua winners Embrace avos?

• Sheep milking conference coverage Open up for accommodation?

• What’s new in the oldest profession mating?

NZ Dairy Exporter @YoungDairyED @DairyExporterNZ @nzdairyexporter

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NEW ZEALAND NEW ZEALAND

ONLINE New Zealand Dairy Exporter’s online presence is an added dimension to your magazine. Through digital media, we share a selection of stories and photographs from the magazine. Here we share a selection of just some of what you can enjoy.

Read more at www.nzfarmlife.co.nz

PROVING THE THEORIES

Pareka farm has gone through a significant change in farm systems this season with the aim of cutting N losses and methane emissions, paving the way and creating learning opportunities for others.

Take a look: https://www.youtube.com/ watch?v=SV9t9tqB3Kc ASB RURAL INSIGHTS - Succession Series Podcast

PODCAST: FROM THE GROUND UP

Sub-editor: Andy Maciver, P: 06 280 3166 andy.maciver@nzfarmlife.co.nz

Young Country is pleased to announce that episode one of From the Ground Up is now live on all of your favourite podcast providers. In the first episode host Rebecca Greaves catches up with Delwyn Tuanui from The Chatham Island Food Co and learns about how he chased his dreams from the ground up.

Reporters Anne Hardie, P: 027 540 3635 verbatim@xtra.co.nz Anne Lee, P: 021 413 346 anne.lee@nzfarmlife.co.nz Karen Trebilcock, P: 021 146 4512 ak.trebilcock@xtra.co.nz Delwyn Dickey, P: 022 572 5270 delwyn.d@xtra.co.nz

Running around Melbourne in his early 20s with a chilly bin full of Chatham Island blue cod, knocking on the doors of the city’s top chefs, Delwyn Tuanui knew he had a special product.

We love highlighting positive stories of young agri-innovators chasing their dreams and Delwyn’s story doesn’t disappoint. Listen to From the Ground Up: nzfarmlife.co.nz/podcasts-2

- Instagram handle @chathamisfoodco - Facebook account @ChathamIslandFoodCo

To listen: https://nzfarmlife.co.nz/podcasts-2/

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Average $9.18/kg MS

2022/2023 Fonterra forecast price

$/kg MS

11 10.25

10.00

9 8

8.50

Mid 9.50

9.45 8.90

9.00

9.25

7

8.75

Fonterra forecast

CONNECT WITH US ONLINE: www.nzfarmlife.co.nz @DairyExporterNZ

NZ Dairy Exporter

@nzdairyexporter

NZ Dairy Exporter

Phil Edmonds phil.edmonds@gmail.com Elaine Fisher, P: 021 061 0847 elainefisher@xtra.co.nz Claire Ashton P: 021 263 0956 claireashton7@gmail.com Design and production: Lead designer: Jo Hannam P: 06 280 3168 jo.hannam@nzfarmlife.co.nz Emily Rees emily.rees@nzfarmlife.co.nz Partnerships Managers: Janine Aish Auckland, Waikato, Bay of Plenty P: 027 890 0015 janine.aish@nzfarmlife.co.nz

Or via their Website www.chathamislandfood.com

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Editor Jackie Harrigan P: 06 280 3165, M: 027 359 7781 jackie.harrigan@nzfarmlife.co.nz Deputy Editor Sheryl Haitana M: 021 239 1633 sheryl.haitana@nzfarmlife.co.nz

Check out Chatham Island Food Co on socials and learn how you can get your hands on their fresh kai moana at:

Welcome to the ASB Rural Insights - Succession Series podcast, where we’re talking about farm ownership transition from all sides. Thanks to the ASB Rural team for partnering NZ Farm Life Media on this four-part series. Each week Angus Kebbell will be profiling farming families, talking to experts from the advisory sector and investigating new opportunities for farmers thinking about diversifying their farming business. When it comes to ‘what’s next’ for the farm, there’s a lot to think about, so we aim to share success stories, provide useful tips and help you understand more about the many facets of succession planning in the food and fibre sector today.

NZ Dairy Exporter is published

by NZ Farm Life Media PO Box 218, Feilding 4740, Toll free 0800 224 782, www.nzfarmlife.co.nz

Tony Leggett, International P: 027 474 6093 tony.leggett@nzfarmlife.co.nz Angus Kebbell, South Island, Lower North Island, Livestock P: 022 052 3268 angus.kebbell@nzfarmlife.co.nz Subscriptions: www.nzfarmlife.co.nz subs@nzfarmlife.co.nz P: 0800 2AG SUB (224 782) Printing & Distribution: Printers: Ovato New Zealand Single issue purchases: www.nzfarmlife.co.nz/shop ISSN 2230-2697 (Print) ISSN 2230-3057 (Online)

Sign up to our weekly e-newsletter: www.nzfarmlife.co.nz

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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MILKING PLATFORM MATAURA

Good things TAKE TIME Onlookers seem stuck in the mud on wintering livestock in Southland, Suzanne Hanning writes.

M

y older brother Our Southern Dairy Hub held a field always used to day last month and shared some of the say “patience results of the pilot study. There is a link is a virtue”. I to the hand out on our Hedgehopeused to counter with “You’re not Makarewa Catchment Group Facebook very virtuous then, are you?” The page if you would like a look. The study word ‘virtue’ means ‘behaviour showing was both surprising, interesting and high moral standing’. Sadly the word most certainly a lesson in patience. ‘signalling’ gets stuck next to it from time My second biggest lesson from this to time and corrodes this into something project is that this is much bigger and dripping with sarcasm. more complex than anyone could have This is all too commonly seen on social dreamed. Finding a better way to winter media when it comes to the opinion of animals in Southland or anywhere with people who have nothing to do with similar conditions to us is going to take a agriculture on what farmers should or lot longer than any politician or activist shouldn’t be doing. As I’ve mentioned will be comfortable with. To be fair, the in a previous column, everyone seems real problem is the three to five rain to have plenty of opinions on wintering events that happen in the 90-day winter livestock in Southland, but they have period that seem to cause all the issues. very little in the way of solutions.

What was obvious was the participants Our fellow farmers down here in who paid close attention to detail, Southland have been patiently waiting methodically followed their plans, for the results of our Hedgehopecarried out careful daily observations Makarewa Catchment Group and and acted on those observations had Southern Dairy Hub Winter Cultivation significantly better outcomes.

Pilot Study funded by Thriving Southland My first, biggest lesson is we need to Working hard to gather data for the and finally, we can start to share what have more faith in humanity. The people wintering pilot study. we’ve learned. who made this study possible at every The key word here was “pilot study”. Wintering animals level are not special or brilliant in any way. They are ordinary outside, on crops in situ is, to my limited knowledge, a individuals who go about their days rather unremarkably, unique method practised nowhere else in the world. Due to performing ordinary tasks and achieving ordinary things. this uniqueness, it has never actually been studied in any What occurred last winter was not ordinary. We had a great detail. voluntary gathering of wills to achieve something greater We didn’t know what we didn’t know and hence cast a than the status quo. From the 17-year-old apprentice huge net over a huge area and tried to have a look at what mechanic, to the agronomist, to the farmer who just tried we caught. What we ended up with was a monster project something a little different. The culmination of their efforts with thousands of data points, pictures, and recorded resulted in a certainty that we will figure this out. observations. All this took until very recently to sift through It won’t be perfect immediately, but we will get there. It and even now, there is still a huge amount of collected will just take a little time, patience and require a bit of virtue information that is being pulled out. and not of the signalling kind.

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

MILKING PLATFORM OPUNAKE

FINALLY…

a place we can call home After a dozen moves as sharemilkers, it’s time for the family to put down roots in South Taranaki, Trish Rankin writes.

Cayden (left) and Mahlee (right) Year 12 Opunake High students planting riparian plants. (photo by Charlie Rankin).

I

t was a big winter period for our family as we moved to a farm we have bought in an equity partnership with a couple of friends/investors. I surprised myself with how emotional I was when I told the kids late April that we had gone unconditional.

See, it has been a journey from Canterbury, Wairarapa, Hawke’s Bay, Northland to Taranaki. We have been burnt financially by not doing a good job in our diligence looking at a farm job, have had challenging farm owners or staff to manage and had some farming hard times with droughts and floods too.

But the day in April, when at 4.30pm our awesome lawyer Jax Owen phoned us to say we were sorted and we were going unconditional, I just burst into tears! We had done it.

We have found a farm 9km from the kids’ high school, just out of Opunake where we spend a lot of our time, that has scope for improvement but also great infrastructure.

To get here was a battle of having a great team around us, strong resilience and goal setting. We had to exercise our right to not have to live on our sharemilking job so that we could take up this opportunity which also came with its challenges when one local farm consultant didn’t think we should be allowed to move off!

He was wrong. He was out of line actually. But, we knew if we couldn’t get into something permanent soon we weren’t going to survive another sharemilking shift in two years.

We have moved 12 times in 22 years of farming and with four happy kids, loving their life here in South Taranaki, continuing the sharemilking life of moving to progress was not something we wanted to continue to do.

We still have our sharemilking job and another lease farm here for the next season, alongside our new farm so it will be a bit hectic, but we have awesome staff on the team and know we can work together to do it for just one more year.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

TCC farmers workshop hosted by Landpro (photo Trish Rankin).

We all know each other’s goals and that this year is a year to lift each other up and help the whole team get to their 2023 goals!

The start of the new season has been wet and wild. Lots of northerly weather patterns have brought a lot of rain and wind. Mild temperatures though and so grass continues to grow if it gets some sun and the water drains away.

Over June and July I also enjoyed getting out and about running workshops. Taranaki Catchment Communities along with Landpro hosted a Farm Pulse workshop onfarm at Warea, just under the mountain. It was a great day and learning how to identify soil qualities, healthy waterways, rules for onfarm offal holes etc was all so relevant at the moment for farmers here.

It was a pleasure to have some of our local Opunake High School year 12s come onfarm and plant our 1200 riparian plants - not many left to do on our farm and it was a bit of a novelty for us knowing that it was our block of land. The kids did an amazing job. With stony soils it wasn’t an easy task.

This will find most people well into calving now. Be safe, have downtime and keep connected with others.

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MILKING PLATFORM WAIRARAPA

THE 190KG NITROGEN CAP – a farmer’s reflection There is only one way to beat the evergrowing list of regulations, and that is to adapt, writes Hamish Hammond.

G

idday, we have just finished the first season of adhering to the 190 kilogram nitrogen cap, so how has this impacted us?

Introduced by the government, this rule states pastoral farmers can only apply a maximum of 190kg of nitrogen per hectare on to grazed land. A higher rate of nitrogen can be applied on crops so long as the extra nitrogen does not lift the overall farm average above 190.

Put succinctly, for our pasture paddocks under irrigation, we put on 23-25kg nitrogen/ha, per month, for seven to eight months (between AugustMay). We chose to skip nitrogen applications in JanuaryFebruary when clover was thriving (under irrigation) and fixing nitrogen.

On the non-irrigated and dryland run-offs we put on higher rates of nitrogen (up to 36-40kg/nitrogen/ha) as we knew we would not be able to apply nitrogen for the same seven-eight month timeframe. This would hopefully maximise our spring growth and help to increase our supplement harvested before the ground became too dry.

Chicory was used on the dairy platform as a summer crop. In theory, this herb thrives off our “little and often” approach to nitrogen.

What happened Annual accumulated pasture grown was down on the farm by ~1tonne/ha. Overall nitrogen use was 158kg/nitrogen/ha compared to previous years of 116 (2018/19), 122 (2019/20) and 170 (2020/21). A greater amount was used on nonirrigated areas and less productive Left: The new clover on the block.

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George and Mac the dog enjoying a paddock of new grass including a mix of two new clovers ( Brace or Attribute by Agricom), a new variety of grass (Forge) and what remains of the chicory crop.

paddocks, and at the run-offs compared to previous years – up from ~90kg/ha to 120kg/ha.

Despite more nitrogen, a poor spring resulted in less grass grown and supplements harvested. In contrast, less nitrogen was used on high-performing irrigated paddocks – down from ~230+kg/ha to 190kg/ha. These changes contributed significantly toward lower total yield.

Paddocks with healthy clover population appeared to be thriving, with less inhibition from synthetic nitrogen applications in summer months, compared to previous years.

This is not surprising, but it made us reflect on the impact of previous nitrogen use on our clovers. Pasture swards with poor clover populations had lower relative growth rates and quality.

Going forward For the most part we will stick to the same nitrogen plan.

We will however switch back to turnips from chicory so we can ensure a bulk yield from our summer crop. This will be supported by one large dressing of nitrogen rather than many smaller dressings with variable response rates due to the unpredictable summers we have experienced in the last few years. We will also delay sowing our turnips by a month, so we can get more feed harvested from pasture before it’s sprayed out.

This year we will do another whole-farm soil test to ensure fertility is not limiting our clovers. These plants need to deliver more than ever! Coupled with the soil testing, we will make best use of our new ‘Clean Green’ effluent system. This will allow us to apply effluent with the same little-and-often approach as our synthetic nitrogen plan.

Most importantly, we will focus on improving the pasture production of our poorer performing paddocks, because our highest achievers are unfortunately capped! This will involve capital expenditure on drainage, subdivision, capital fertiliser and a new model of pasture species. These improvements can cost big dollars, but there is only one way to beat the evergrowing list of regulations, and that is to adapt. Something we farmers are rather good at!

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

MILKING PLATFORM WEST COAST

An obsession WITH GRAVEL Repetitive work got Richard Reynolds thinking.

I

have been spending a lot of time in my office lately (aka my little digger). Owning a digger has some advantages, one of which is most of the time it is pretty repetitive work requiring minimal thought. So as a result you get to think a lot.

This time my thoughts did not have to go far, they all centred on gravel and gravel management. The obsession with gravel is based on having to clean one creek out twice this winter, having to put in two new bigger culverts because the original ones blew out twice. I also have had a small creek destroy a neighbour’s culvert and cover the road before coming through my paddock. Most of the effects to me have been minor compared to other farming friends losing large amounts of land and major bridges.

My problem with gravel management in New Zealand is, well, we have just stopped doing it, we have resorted to bigger and higher stop banks at ever-increasing costs. We cart boulders around to keep rivers in their “correct place” and the removal of gravel has become an expensive and haphazard event.

I think the only option is to let the waterway do what it wants to do and change course and dump its gravel in a lower-lying area.

Where I live we have a short and steep fall from the mountains to the sea and the production of gravel has increased over the last years due to high rainfall events and cyclones killing trees.

This is no different to other waterways, it just happens quicker here because of the slope. The basic fact is gravel and water all want to go to a lower area on their journey to the

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

On the West Coast the gravel always bursts out of the bush and searches for a way to the sea. It’s called gravity.

sea. Our farm was made up of these gravel fans over centuries and with us having different gravel coming from each valley we can tell where the creeks have run over past history.

Naturally they are always trying to break out of their bed. Moving left or right is the aim of a waterway. Some do this with gravel, some with flax and other plants.

It is humans that have Spending time remediating culverts and creeks after winter rains has given built assets like bridges Richard Reynolds lots of time to think that want and need about the grave issues - like gravel waterways to keep where management. they are and for this to happen there has to be gravel management. This management can take the easy option of removing and using the gravel but in some cases the sheer volume of gravel is beyond any need or ability to remove and use the gravel.

I think the only option is to let the waterway do what it wants to do and change course and dump its gravel in a lower-lying area. It would take a brave council to have this as a management plan with all the work it would involve of land swaps and taking on the people that believe rivers are sacred and should stay where they are. In the long term it would be a much cheaper and more natural approach to gravel management than what we have at the moment.

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INSIGHT

UPFRONT TRADE AGREEMENTS

REALPOLITIK IN WORLD DAIRY MARKETS While industry advocates have bemoaned the limits of the free trade agreement with the European Union - one of the world’s most protected markets, Phil Edmonds looks at the positives.

W

ith the dust settling in the wake of New Zealand and the European Union revealing a free trade agreement had been landed after years of deliberation, the opportunities for dairy export growth need to be reimagined.

In the lead up to the EU deal being finalised, some industry advocates were arguing a favourable deal was essential for NZ to ensure the value of our dairy exports could keep growing. What was negotiated, however, was widely acknowledged to be ‘unfavourable’.

Does this mean all hopes for growing the value of what we produce have been dealt a fatal blow? The answer is likely no, but it might mean we’ll have to work harder to achieve it.

Recently back from the bargaining table, New Zealand’s chief negotiator for the FTA with Europe, Vengalis Vitalis spoke at the Primary Industries Summit in Auckland, and called for those upset by the paucity of sweeteners for dairy to take stock of the wider market reality. Vitalis openly accepted the gains from the deal were miserly and expressed frustration at that. But the context was also important. He noted that NZ is the only market other than the United Kingdom that has preferential access on dairy.

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

While quotas will still limit the extent that dairy exports can grow, the near elimination of tariffs over seven years will mean some butter (36,000 tonnes) will be able to enter with a tariff of 95 euros per tonne, down from 770 euros.

The fact that this has been afforded to other markets beyond the UK sounds like cold comfort, but the reality is NZ will have an edge on others. For example, Mercosur (the South American bloc of countries including Argentina, Brazil, Paraguay, and Uruguay) had negotiated 30,000t of cheese quota in its deal (which is currently floundering and won’t be ratified anytime soon) but with tariffs phased out over 10 years. NZ secured 31,000 tonnes of quota that goes to zero tariff on day one.

Among the other reality checks we need to consider are how European dairy producers felt about the deal.

Vitalis noted the European Fed Farmers equivalent, Copa-Cogeca responded by saying EU dairy farmers had been sacrificial lambs and they had paid a very high price. Almost comically, they argued the new access NZ dairy products had obtained will increase market pressure on European production. If the prospect of the very occasional baguette being slathered with NZ butter does induce sleepless nights,

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

it’s hard not to conclude they’re still on a reasonable wicket.

All that said, everything is relative.

We might wish to ignore it, but recent legislative changes in Europe have compelled farmers to make radical adjustments to their operations, which will undoubtedly impact on their productive capacity. Over the past couple of years, the Netherlands, for example, has introduced a 13-year plan to significantly reduce livestock numbers to address nitrogen problems. This plan also involves initiatives to prompt farmers to leave the industry. Any further imposition, however minor in impact is likely to add fuel to EU farmers’ sense of struggle.

It’s possible to say that European farmers’ blight in this regard is no different to that being experienced by their NZ counterparts. But again, that won’t have forced them to think of us as comrades in arms.

Interestingly though, the deal implies just that, via the joint commitment to the principles of sustainability. Both the EU President Ursula von der Leyen and NZ trade minister Damien O’Connor made a point of highlighting a clause that states neither party will deviate from the Paris Accord for climate change for trade advantage.

Agriculture Minister Damien O’Connor.

Chief trade negotiator Vangelis Vitalis.

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The EU President said it was a first for a trade deal to include sanctionable commitments to the Paris Climate Agreement, while O’Connor made the unsubtle point that NZ would be taken to task if it strayed off its stated climate obligations. For Vitalis, this represents a reassuring outcome in that NZ would be able to raise concerns about the impact on prices of ANZ agricultural European environmental subsidies in a legally binding economist Susan Kilsby. way. Furthermore, one of the reasons the Mercosur FTA with the EU has run into problems in the pre-ratification process is that a commitment to reducing its environmental footprint is out of alignment with the EU’s. With NZ sharing the EU’s goal, our goods should have more appeal.

Equally though, there’s justification to be cynical about the EU’s apparent respect for the efforts NZ is making to de-carbonise its economy. Proper respect would have meant NZ dairy products being afforded fairer access. As DCANZ said in its assessment, “The EU has largely rejected the opportunity to provide its own consumers with access to NZ dairy products that have considerably lower carbon footprint. New Zealand dairy farmers will be disappointed that their considerable efforts in adopting onfarm sustainability practices are not able to gain the extent of market recognition they deserve under this outcome.”

It would be nice to think European consumers would have the ability to reward NZ farmers for this, but with the quotas set for cheese and butter, there’s very few consumers who will have an opportunity to do so. DCANZ added a stark reminder of the market imbalance where the EU has about 15% share of the NZ domestic dairy market, but NZ would only have about 0.14 percent of the EU market.

With that sobering reality in mind, what now are the opportunities for NZ to achieve export growth?

With the EU deal concluded, suggestions have been made that for the time being at least, there’s not much more we should expect to see in free market access. The government has pointed to opportunities that will arise if NZ was to gain associate membership of the Pacific Alliance (Mexico, Peru, Colombia and Chile). Colombia is said to be a noteworthy importer of dairy products. Elsewhere access could be improved by advancing the FTA with the Gulf Cooperation Council, which would create a level playing field for exporters.

On the face of it, this suggests there are now limited

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prospects for the NZ dairy industry to grow its exports.

Not only that, but the charge also to transition from ‘volume to value’ (which is fundamentally where NZ must go with milk production having peaked) is challenged with the highest value markets (EU, together with the United States) either marginally accessible or inaccessible. However, that presumes accessing high value markets is simply based on increasing rules-based free access on a country-bycountry basis. Obviously, those conditions enable growth by the easiest means. What we probably need to come to terms with is there remains plenty of opportunity to capitalise on high value markets within countries that NZ has existing free trade deals with – but they are niche and will require more effort.

It’s also worth reflecting on NZ’s existing competitive advantage in the trade of dairy products, where we are closer to the world’s key growth markets than our rivals. The EU has tended to push its surplus output down into the Middle East and Africa, and excess production in South American markets has tended to fill gaps within the region itself. But those markets have not been high growth or high value, unlike Asia, and specifically China where NZ still commands a head start with an existing trusted relationship.

Yes, you never want all your eggs in one basket. To some extent that has been the reason many felt the EU deal has been a particularly sore loss, with government regularly nudging exporters to diversify away from a reliance on China. But you also need to focus on where the growth is, and despite potential geopolitical tension, China and Asia is where growth opportunities remain. There’s no point ignoring that – other market producers will be more than happy to fill the void.

ANZ agricultural economist Susan Kilsby says this will require a turnaround in our thinking, which means identifying niche groups of premium consumers within existing markets and responding to their needs.

“To some extent we do that anyway. Fonterra has long supplied Nestle with ingredients that give consumers what they want. But there will be more demand for products to be produced in a way that will command more value. At the moment there is an information gap, where market information doesn’t necessarily flow back to the farmgate. But some suppliers are being linked in through processors to give consumers something extra.

“Synlait and Miraka have identified this and are meeting specific market needs on a smaller scale.

Fonterra will eventually do this on a much bigger scale.”

The hurt over the missed EU opportunity won’t disappear overnight, but to move forward we can’t afford to dwell on being locked out of a geographical market. Rather we need to dwell on what it takes to be locked into high-value markets within markets, wherever they may be.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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GLOBAL DAIRY CANADA

North America’s dairy dispute Lawyers and lobbyists appear to be the winners in a tussle between United States and Canadian dairy industries. By Anne Cote.

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he United States, Canada and Mexico signed a new trade deal in 2020 after three years of tough negotiations. Part of the deal, known in Canada as CUSMA and in the US as USMCA, focused on Canada’s supply-managed dairy industry. US dairy producers and processors wanted Canada to drop the supply-managed system and allow full access to the Canadian market for US dairy products. Canadian dairy producers and processors dug in their heels and fought to keep the system.

The Canadian dairy industry won, sort of. In return for keeping their supply-managed system they agreed to allow the US to increase dairy exports to Canada but set out specific TRQs to be managed by the Canadian dairy industry and government trade personnel.

The elusive TRQ, an acronym that pops up over and over in dairy conversations on both sides of the border, is “tariff-ratio quota”. It allows a set amount of product to enter a country at a lower rate than the regular tariff.

It didn’t take long before the US launched several claims against Canada’s trade practices. The only complaint the US won was the one pertaining to the dairy TRQ allotment mechanism.

They said it hindered the flow of dairy products from the US to Canada by assigning a portion of the TRQ to Canadian processors.

The CUSMA dispute resolution panel ruled Canada should revisit its method of allotting TRQs to processors and distributors. Canada complied and announced a new allocation mechanism on May 16, 2022. Mary Ng, Canada’s minister of international trade, export promotion, small business and economic development, said in reference to the result of recent US challenges to CUMSA, “The dispute settlement panel’s report ruled in favour of Canada in a majority of the claims. The new policies address the sole finding of a CUSMA dispute panel that Canada’s practice of reserving TRQ pools exclusively for the use of dairy processors is inconsistent with the agreement.

The new policies end the use of processor-specific TRQ pools.”

According to a Dairy Farmers of Canada statement the same day, “The new allocation mechanism, which 18

is based on market share, does not reserve any portion of the CUSMA TRQs specifically to Canadian dairy processors and is therefore fully compliant with the CUSMA dispute settlement panel decision.” (2022).

So, the U.S. won its argument on TRQs but they didn’t stop there. They launched a second complaint, again about the allocation and management of dairy TRQs. The US Dairy Export Council (USDEC) and the National Milk Producers Federation (NMPF) continue to push for more access to the Canadian market and issued a joint

statement on May 25, 2022. In it, Jim Mulhern, president and CEO of NMPF states, “Dairy farmers appreciate USTR’s (United States Trade Representative) continued dedication to aggressively pursuing the full market access expansion into the Canadian market that USMCA was intended to deliver.”

This type of back and forth rhetoric over trade deals is not new to US and Canada trade relationships. The greatest winners always seem to be the lawyers and lobbyists as years grind by with little or no progress on a myriad of claims presented to dispute panels.

Minister Ng supports Canada’s stand on dairy TRQs saying, “Canada has met its obligations under CUSMA to ensure that our TRQ system is compliant. We respect the right of the United States to initiate the dispute resolution mechanism as part of the agreement. Canada will actively participate in CUSMA’s consultation process and stand by our position to administer our TRQs in a manner that supports our dairy supply management system.”

• Anne Cote is a Canadian dairy journalist.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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With its distance from most consumers, the New Zealand dairy industry sometimes has difficulty making the connections. By Stu Davison.

n intricacy of the New Zealand This is the changing face of consumers’ dairy industry is the extreme buying habits - tightly held opinions. isolation from our consumers The entire primary production system unless you’re selling dairy products globally is facing the same predicament. at the end of the driveway or in a local Consumers have rapidly shifted their shop, you have very little to do with the buying decisions over the last two years, end consumer of your beautiful white gold. both as a result of Covid and digitalisation This intricacy is both a positive and of our lives increasing. negative result of how our industry took These changes have led to including key on the world markets; that is, decisions now involving such things combining resources into a coas environmental factors, health operative, and separating the and wellbeing impacts, immuneskill set between farmers and building abilities of a product, processors to optimise the associated status induced from outcome of smaller farms at the purchase and oddly enough, the time. taste is still somewhat important.

It has made the world of The underlying product has difference over the last 100 Stuart Davison. not changed - it is still cow’s years. However, at our current milk. However, to differentiate in scale, and comfortability, I feel as farmers a competitive environment, products in the day-to-day grind onfarm, we often must seem better than the competitor’s forget that our product requirements are product next in line on the shelf, which still determined by the consumer at the leads to the list of now important factors end of the day. I think of end consumers to consumers. All of this leads me to as the largest risk outside the farm gate, my favourite saying; treat your farm that will undoubtedly influence any farm like a restaurant. If you walk into any business. establishment for food that doesn’t please These consumers exclusively determine your eyes, you will most likely turn and the market outcomes via their wallets. This leave. It’s human nature most likely is hard to argue with. However, where and established from not eating food covered how deep the wallet is opened and pillaged in muck. The old saying “we eat with our is determined by the consumer making eyes” comes in nicely here. Our consumers an informed decision around the product are the same, but from a massive distance. they’re buying.

They want the same assurance of a Using the word “informed” in the last clean restaurant, but from anywhere in line is often the first point of arguments, the world while they enjoy their room but let’s face it, everyone thinks they’re temperature drinking yoghurt or butterright, it’s called an soaked croissant. opinion...

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Unfortunately, the array of global consumers and their differing demands have shifted so quickly over the last 1015 years, that it is very hard to keep up with what they actually want, and let’s be honest, I don’t actually think they really know what they want, but some very slick marketing is helping to convince them of this thinking. Unfortunately, that is the power of good marketing; it works for and against every producer, an everperpetuating problem.

So, as we look forward to what else will impact farm businesses from this everchanging array of consumers, expect more product differentiation to come down the pipeline, in one form or another.

Unfortunately, the wheels of change are spinning quickly in all parts of the value chain, such as Miraka’s geothermalpowered powder drier, Synlait’s electrode boilers and Fonterra’s woodchip/biomass boiler in Te Awamutu. All the start of ongoing changes to help NZ dairy stand out from our competition, as we try to keep our place in changing world markets.

However, making changes to consumers’ buying decisions starts with those at the coal face, ironic statement in this context, I know. Unfortunately, we have two options: give the consumer what they demand and be rewarded with top dollar or keep the status quo and slide to the bottom of the demand pile.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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BUSINESS FARM OWNERSHIP

GETTING IN, GETTING OUT Whether you’re moving into the industry, or on your way out, it pays to be well prepared. Anne Lee reports.

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hether you are putting the first tentative step on the progression ladder or looking to ease out in terms of time or equity, being “best dressed” for the job will carry you a long way.

“Getting in or getting out” was the title of a SIDE workshop run by Compass Agribusiness in Oamaru in June.

Regardless of where you are at – getting in or getting out – being investible either as a business or more personally will help set you apart from others and make you someone others want to align with.

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Take stock • Understand where you are now – in terms of skills and financially.

• Understand what the other party wants and build towards that if you’re not there already. Use a third party to help with that assessment – someone who has the skills to do so.

• Know your strengths and weaknesses – if you are stepping up to be a sharemilker or contract milker, are you a good manager of people, do you understand PAYE, rosters and the regulations?

If you are a farm owner taking on a sharemilker or looking to reduce your input through equity partnership or succession, can Dairy Exporter | www.nzfarmlife.co.nz | August 2022

• •

•

•

•

you actually let go and allow someone else to do it?

What’s your reputation or brand?

Know your values – do they align with the other party? That’s crucially important if you’re moving into any kind of business relationship.

What’s the quality of the asset? What are its strengths and weaknesses? Is there contingent liability – upgrades needed to effluent systems, irrigation, farm dairy?

Where are the risks and opportunities for the business? Understand where it sits with environmental compliance, what regulations and rules will impact it. Has the production and analysis of profit been done with those rules in mind?

What are your non-negotiables? What’s so important to you that you’d decline an opportunity with a person or business?

Set goals and plan Goals can be long, medium and short range. They should be SMART

S M A R T

- Specific - Measurable - Attainable - Realistic - Time bound

Goals will give you direction and give you boundaries when making decisions – will this help me get closer to my goal or push me away from it?

Write them down – that makes you more accountable, reminds you what they are, clarifies your goals, helps you review progress.

A Harvard business study found people who write their goals down are more likely to achieve them, if they share their goals with someone else and let them know how they’re going along the way to achieving them they become even more likely to achieve them.

You can change your goals.

Once you have set the destination, plan – how will you get there? Understand what’s needed to achieve them.

Planning allows you to break down the goals into more manageable pieces.

It may not be linear to get there – sometimes you may have to move sideways or even back down and then back up again to make it to your goals.

What do you need to learn, what skills and competencies do you need?

If you are looking to take on a sharemilker, equity partner or carry out succession what skills or attributes are you looking for to get you to your goals.

Understand what the other person’s goals are – are they compatible with yours.

Being best dressed Build a strong reputation.

Build a strong, credible CV. Build your skills.

Build strong relationships - make sure the people you work for and alongside become your backers.

Take opportunities to learn and educate yourself.

Avail yourself of courses and programmes within the dairy sector such as Mark and Measure and the NZ Dairy Industry Awards.

Work closely with trusted, capable advisers.

Understand your accounts and finances.

If you’re getting in – limit your debts, have a personal budget and understand where your money is going. Have a savings history. All of that will give a banker more confidence in you.

If you’re getting out- have a farm business that’s investible not just a farm that’s saleable.

Know your business inside and out.

Is your system repeatable?

Be happy to share information – it gives investors comfort, helps them understand the operation and the full proposition.

Information should include – production history, operating costs, key inputs, staff structures, assets, impacts of changing rules, stress test it all.

You can get out to varying degrees by bringing in a manager, contract milker, sharemilker, equity partner, succession or selling up.

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

KEY QUESTIONS: 1. What sort of involvement do I want – high or low?

2. Do I want to release capital?

3. What risk do I want to take?

From left Hayden Craw, Paul Edwards and Ollie Knowles at SIDE.

Assessing the opportunity, due diligence Does the opportunity align with your goals?

What will your position be if you take the opportunity, full financial analysis, stress test it?

Treat every opportunity like a partnership and assess the people involved – are your values aligned, do your farming styles align, do they have someone who can act as a referee?

What will life look like day to day?

Use a third party to do the assessment or to check your assessment.

Keep the emotion out of it to start with and do the clinical assessments but at the end when that’s completed ask – what does your gut tell you?

Family situations have more emotion – bring in the skilled, trusted third parties.

If you’re looking to become less involved consider smaller steps first – could bringing in an officer manager free you up, can you handle stepping away and giving up a small amount of control?

For a sharemilker looking at an opportunity – understand the labour requirements and how production is achieved. Stress test and ask the what if scenarios – milk price drop, cost increases, climatic stress, infrastructure failure.

Check for robustness. Understand the farm infrastructure, cup removers, irrigation, effluent, is the farm up to scratch for rules and coming rule changes?

Is the financial reward commensurate with the risk?

Check out the farm owners – their values, reputation.

Remember just because it’s a step up in terms of the normal historic pathway it may not be a step up in terms of profit or a move towards your goals.

Have a pros and cons list.

A good outcome is where each party is moving towards their goals.

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

BUSINESS CONTRACT MILKING

Contract milkers miss out on premium Dairy NZ hopes ist new calculator will make contract milker premiums transparent, Anne Lee writes.

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lmost a third of the contract milkers included in a DairyNZ analysis made close to no premium over managers’ wages, sparking a call for contract milkers and their farm owners to carefully run their numbers through a new DairyNZ contract milker premium calculator.

DairyNZ systems specialists Paul Bird and Phillipa Hedley have analysed financial data from DairyBase for 80 contract milkers over four consecutive financial years looking at the returns made over and above a farm management wage.

Because contract milkers employ the staff to operate the farm and take on additional risks and responsibilities compared with a farm manager their contract rate is expected to be set to recognise and compensate them for those additional risks and responsibilities.

“But what we’ve found is that 27% of contract milkers would actually be better off financially if they were managing.

“Most of that 27% were in fact worse off – their premium was negative and, in a few cases, substantially negative.

“If we lift the cut-off point to $10,000/ year (premium over wages) then we’re talking about a third of the contract milkers we looked at who were no better off than if they were managing the farm.

“There’s no return to them to cover

Paul Bird: ‘This season we’ve seen very big lifts in some costs .’

‘WHAT WE’VE FOUND IS THAT 27% OF CONTRACT MILKERS WOULD ACTUALLY BE BETTER OFF FINANCIALLY IF THEY WERE MANAGING.’

CALCULATOR Find and download the DairyNZ contract milker premium calculator: www.dairynz.co.nz/business/setting-up-for-success/do-yourhomework/sharemilking-and-contract-milking-arrangements

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

things like taking on the responsibility of employing labour or production and other risks,” Paul says.

Receiving a fair return for contract milking helps provide stability from year to year so good people remain onfarm and, in the longer term allows them to grow their wealth so they can become the farm owners of the future, he says.

DairyNZ has been working with Federated Farmers in developing the contract milker premium calculator and are promoting it with rural professionals.

Paul says the analysis using the calculator was carried out on budgets from 2018 to 2021 and while the premium has fluctuated from year to year this season it’s likely to come under particular pressure from the rapid rise of onfarm cost inflation.

“This season we’ve seen very big lifts in some costs, especially labour, so it’s

25

CHECK LIST

Contractor milker premium per season 2018-2021 (Premium equals the differenece between contract milkers incomes and manager income)

40 30 20

important for all contract milkers and farm owners to review their budgets to ensure the premium is there.”

While the median contract milker premium has been $26,000/year the results of the analysis show a wide variation with some contract milkers earning a premium of more than $80,000/year and a small number more than $140,000.

Larger contract milking jobs do tend to have higher contract milker premiums but the data analysis found some largescale jobs with small premiums and some average size jobs (of about 500 cows) with larger premiums.

“It’s not our job to set a specific premium level – what we want to do with the calculator is shine a light for contract milkers and farm owners on the real return premium the operator of the farm is receiving.

“By making the contract milker premium transparent both the contract milker and farm owner can then make their own judgements on whether it’s at the right level.”

The calculator, while simple to use in terms of inputting data, has complex calculations sitting behind it to account for factors such as the tax benefits of being a business owner. It also allows for the contract milker’s full budget with all associated costs to be inputted.

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> $150,000

$140,000, $150,000

$125,000, $140,000

$80,000, $95,000

$65,000, $80,000

$50,000, $65,000

$35,000, $50,000

$20,000, $35,000

$5,000, $20,000

- $10,000, -$5,000

- $40,000, -$25,000

- $25,000, -$10,000

- $55,000, -$40,000

- $70,000, -$55,000

- $85,000, -$70,000

- $100,000, -$85,000

< $100,000

0

$110,000, $125,000

10

$95,000, $110,000

Number of contract milkers

50

“The terms of contracts can vary quite significantly – some will include costs others don’t, and farms can have situations specific to them.

“The calculator creates a kind of agenda for a discussion between farm owner and contract milker and possibly a third party, rural professional, so nothing gets missed – benefits or costs.”

Paul says there’s usually two main reasons why a contract milker isn’t receiving a premium over farm management wages.

“One is that the contract rate is set too low to cover the costs the contract milker is expected to cover.

“The other is that the contract milker isn’t achieving the production expected in the contract.

“That could be because the contract milker doesn’t have the farming skills and they would in fact be better off going back to managing and sharpening their pasture management skills for example.”

Paul also advises both contract milkers and farm owners to take a careful look at the numbers going into the budget.

“Look at it line by line and get updated costs for everything.

“We do see costs rising over time so it’s always a good idea to review the budget carefully every year but this year – even



To help ensure that contract milking rates are set fairly when developing contracts, contract milkers and farmers should: • Carefully review the contract expectations and figures and get independent advice if required – this is particularly important for contract milkers who are new to the role or who aren’t strong on financial management.

• With inflationary costs changing quickly check that the contract is based on current figures and not out of date numbers.

• Ensure that the contract makes allowances for further cost increases and is set up to ensure that contract milkers aren’t penalised for this – for example many contracts provide an opportunity for contract variations. Some contracts also provide additional rewards to contract milkers in high payout years.

• Use DairyNZ’s contract milker premium calculator to assess the contract milker return based on current costs.

• If contract rates have been set too low for the current season – then both parties should discuss the situation as a first step. Involving professional advisors can also be useful. You may be able to identify opportunities to review contract conditions or to agree on how cost increases can be managed.

over the last few months, we’ve seen costs really take off.”

It’s possible that a contract signed early this year could now leave a contract milker with little to no premium over farm manager wages by the end of the season.

While farm owners may be looking at a high payout, contract milkers’ rates are fixed but contracts can include additional payments during high payout years.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

BUSINESS FUTURE FARMING

Farmers must be in the driver’s seat Words by: Anne Lee

a significant role. The decree has since ri Lanka’s disastrous organic been abandoned. Will says any change for farming experience should serve the agricultural sector in NZ, particularly as a warning to New Zealand when it comes to government or local farmers that they must body regulatory change, must be have a strong voice when based on a well-informed strategy it comes to regulation and and driven by farmers from primary sector strategies, behind the farm gate.

Ngai Tahu farming and Farmers know the realities of forestry general manager Will farming and those realities need Burrett says. to be considered to inform change While an extreme example, within a solid strategy that then Will Burrett. he says it shows what can happen leads to better value. with uninformed change.

“We can’t forget our first principles of Will was speaking at a future agriculture. We are marginal-cost farmers. focused forum Dairy 2032 hosted We need to maintain our cost structures. by agritech company Halter at Ngai “We are in a really inflated commodities Tahu’s 6757-hectare Te Whenua Hou market at the moment which is really farming operation at Eyrewell, north of exciting but we have to stay true to our Christchurch. core.”

Will told about 100 farmers that As to where the world is headed in the watching events unfold in Sri Lanka had next 10 years Will pointed to indications been an “aha” moment. The economic for shifts in consumer preferences. and social impacts of a poorly informed The somewhat controversial EATand sudden move by the government to Lancet report in 2019 suggested stop importing fertiliser and ban the use that to improve human health and of pesticides has been swift and brutal, he environmental outcomes by 2050 says. people in many developed countries in The decreed, whole-of-country shift to particular needed to move to eating a lot organic agriculture was reportedly carried less red meat (up to 50% reduction) and out with little input from mainstream dairy while doubling the consumption farmers and the country’s agricultural of wholegrains, vegetables, nuts and science sector. legumes.

Its aim, in part, was to improve But what does that kind of shift mean Sri Lanka’s balance of payments by for those behind the farm gate? increasing the value of food exports and There’s more talk of a farm mosaic cutting fertiliser imports at a time when compared with the current situation the country was already suffering the where 90% of total income is derived Covid-19 related collapse of the tourism through one product or channel such as sector. milk.

Instead, yields of tea and rice rapidly “What could that look like by 2032? slumped and the country has quickly “Do we have the same number of swung from being a net exporter of cows on our farms? Are we ascribing products such as rice to becoming a more areas to crop and a different protein net importer as it fights to feed the revenue?” population.

Technology such as Halter with its While it’s not the only factor in the ability to direct cows to different areas of country’s spiralling economic collapse the farm or areas within paddocks may and social unrest it has arguably played make such mosaics easier to manage.

S

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

Consumer preferences around diet, animal health and welfare and environmental concerns all needed to be considered when challenging thinking on farm system design.

“If we have a bucket of capital in our business – how are we going to allocate that capital to get a return?

“Granted some of the money we are going to spend will be on our licence to operate our current systems but there are certainly going to be other things that will provide channels of new revenue.

“We all need to be on the same page as to what that looks like and be confident the consumer will be willing to pay.”

Farmers must also be the drivers of the strategies on how to get there.

REPORTS AND FURTHER READING The EAT-Lancet report: • eatforum.org/content/ uploads/2019/07/EATLancet_Commission_ Summary_Report.pdf Not everyone was happy with the report: • italiarappginevra.esteri. it/rappginevra/en/ ambasciata/news/dallambasciata/2019/03/ comunicato-stampa-sullancio-del.html Sri Lanka: • www.nytimes. com/2021/12/07/world/ asia/sri-lanka-organicfarming-fertilizer.html

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BUSINESS DAIRY 2032

WHEN THE WORLD MAKES SENSE Ten years of working in an audited environment is paying off for Canterbury farmers, Anne Lee writes.

T

MC Scotty Stevenson and the panel – from left Charlotte Glass, Scott McDougall and Peter Morgan.

echnology and data will be an integral part of dairying in the next decade with the insights they provide used to design farm systems, to tell our farming stories to consumers and to certify our our quality assurance.

That’s the view from a three-person panel at Dairy 2032 – an event hosted in Canterbury recently by agritech company Halter.

Veterinarian and animal health researcher Scott McDougall, Canterbury environmental consultant Charlotte Glass and Waikato dairy farmer Peter Morgan joined a panel discussion led by host Scotty Stephenson.

Charlotte told the audience of about 100 farmers the sector must move its thinking beyond compliance

alone, shifting towards customised strategies for individual farms that deal with both the current and foreseeable environmental issues.

“The nice thing is that when you get 10 years ahead of compliance and you look back, you’re considering emissions and sequestration, changed climate and water quality and then you start to realise the mitigations you should be doing work for all of those things and the world starts to make sense.”

Canterbury had a head start on most regions and has been working in an audited environment for almost 10 years. While the goal posts – in terms of rules - aren’t shifting, necessarily, they can be confusing and there are a lot of them, she says.

“What we do to cope with that – we try and get it ahead of it by 10 years – build a strategy and then you can choose the bits you want to fight and the bits you don’t want to.

“The more you have to provide

Welcome to continuous transparency Think of yourself as a Formula One driver with a crew chief in your ear, explaining what’s going on and a whole team of engineers, probably working remotely, monitoring and evaluating data and the environment you’re working in and the performance of your operation.

That’s the analogy Lincoln University Professor Hamish Gow uses to explain farming into the next decade where data and insights from it will inform and certify the business. He says the sector is about to undergo a series of “flips.”

“We’re moving from a world that was

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regulated and compliance-based to a world that’s certified and going to be driven by the conscious consumer.

“We’re moving from a world that’s ‘tick the boxes,’ to one which has continuous transparency driven by digital passports.”

Farmers will go from jack of all trades to running high-performance teams, moving from tacit knowledge to having codified, digitised and artificial intelligence (AI) enabled data so all the players in the high-performance team can engage.

“Telling the story isn’t enough anymore it has to be validated.”

Conscious, high-value consumers in Europe were already demanding products with digital passports for items such as textiles and electric cars and it was just a matter of time before that included food.

“We are at the point of systems change.

“We don’t know exactly what it will look like but we know it’s coming.

“The government has already put its flag in the sand with its Fit for a Better World strategy.”

It’s not something to fear though. New

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evidence the more you question the logic and the more you do that the more you ask questions of research and you get on to the front foot.

“There’s a big change in direction towards understanding environmental aspects, and rightly so – we probably overpushed things a wee bit and whilst we turn the big old Thames truck around - which is the strategy for the country - it takes us a bit of time to inform the logic.

“But NZ farmers are the best in the world at innovating and that’s because they like to understand things from first principles.”

The rules at present relate to water quality but the rules in terms of greenhouse gas emissions are coming and it will take a different kind of thinking to find farm systems solutions for them.

“We’ll have to think about biogenic emissions differently - we can’t produce our way out of this one.

“Even if we get mitigations, they won’t be free, they’ll come at a cost.”

Peter says 10 years isn’t very long in a farming time horizon.

“It’s the day after tomorrow.”

“We’re going to have to be better connected – connecting staff with pastures, with animal management and our farm system so staff not only understand how the farm works but also how they contribute to it. “Farmers must stay in control, contributing as reasonable people to the discussions with government and regional councils, taking our consumers along with us so they understand we’re

Zealand farmers have done it before, he says.

Halter chief executive Craig Piggott agrees.

“Change can be really exciting and building a better business is super exciting.

“We’ve got to lean into this.

“You won’t be in the machine running it all the time, you’ll be working on it.

“You, as the farmer, become the decision maker, critical thinker you’re strategising about how to make trade-offs.”

Farmers will become the pilots in their business and insights from data will provide them with information to make the best decisions as well as tools to help them execute their management decisions.

human and they understand our story.”

He and wife Ann own a 265-hectare farm running 630 cows all fitted with Halter technology. Two of their farm team are career changers who aren’t that driven by technology, he says.

“But that can be ideal because they don’t want to ‘play’ with toys.

“They want to create outcomes - how do I optimise my time, my animal movements, my grazing management?”

The data collected by the solar-powered collars is also giving the team an extra layer of insight into the “secret lives of cows”, he says.

Cows can be so staunch sometimes they don’t show signs they’re unwell early on, he says. The data will be imperative to prove to consumers that cows are happy and healthy, Scott says.

“If we don’t have social license, we ain’t got an industry.”

Having the swathe of data collar technology such as Halter can provide is one thing, but it will be vital that smart algorithms then monitor and analyse that data to create dashboards and management options for farmers.

We also need robust science on how that data tells us cows are happy - what defines a happy cow?

“What does good rumination actually look like, for instance?”

Then we’ll be able to tell overseas consumers, hand-on-heart, that our cows are happy and healthy and we have the data to prove it, he says.

SETTING THE BENCHMARK Welcome to the next generation of in-bail automatic teat sprayers.

Fully automated and ready to integrate into any rotary system, the iSPRAY4 makes milking easier and hits its target each and every time. Ensuring full coverage of teat spray to each milking quarter, it’s your herds’ best asset in the fight against mastitis.

Automate your milking routine: GEA.com/new-zealand

Professor Hamish Gow and Craig Piggott.

WATCH VIDEO: www.youtube.com/watch?v=Ct1EbjnT0bY

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

29

BUSINESS GOVERNANCE

Two terms later…

A governance development programme saw Donna Smit climb the ranks in boardrooms.

By Claire Ashton.

D

onna Smit’s governance resume reads like a who’s who of the primary industry sector; Dairy Women’s’ Network trustee, and directorships of EastPack, Ballance Agri-Nutrients, Primary ITO, Eastern Bay Energy Trust, and until November 2022, farmer-elected board director at Fonterra.

Her path to such a pivotal governance role began when she saw an advertisement in a rural magazine for the Governance Development Programme with Fonterra which was established in 2006 to help address dairy industry and rural sector succession needs, and boost regional governance.

She had been a company administrator at Eastpack for 24 years, where they took it from a small co-op to the largest supplier of Gold Kiwifruit to Zespri.

Eastpack was close to home, family, and thier Bay of Plenty farms. However, Donna had a bit of a wake-up call driving home, yet again late for dinner, and decided it was time for a change and applied successfully to the governance development programme.

Donna took part in the Fonterra governance programme for two years while wrapping up work at EastPack. The programme was intensive at times, and involved week-long training sessions, book reviews, personality tests and coaching.

Persistence and her stellar resume saw Donna’s applications to director positions on Fonterra and Ballance boards be accepted simultaneously, however, with a clash of meeting times, Donna opted for the Fonterra role in August 2017. She had previously applied and been ‘first loser’, however, perseverance pays. She wanted to be on the team to take the co-op back to its core values.

“You could see there were issues at Fonterra, and you could see that the place could be so much 30

better when you see how other boards operate.

There was a dominant leadership culture in that board at the time, and that’s not how highly effective boards run - you need to run the full skills of the whole team. Alongside that, Fonterra’s strategy to be globally relevant wasn’t working.

“The whole strategy was at odds with our competitive advantage, quality, highly nutritious pasture-based milk,” Donna says, and the strategy to focus on New Zealand milk resonates well with farmers.

“To me, no matter what board you are on, you have to work out; how does this business create value and then how do you go after that value?”

The Fonterra Board, during Donna’s time, has had three different chairmen; John Wilson, John Monaghan and now, Peter McBride, two chief executives, and two chief financial officers. The previous 12-member board was reduced to 11, with nine out of the 11 having a tenure of six years or less, only Leonie Guiney and Clinton Dines have been on the board longer.

This relatively new board has seen major changes in strategy, purpose, risk settings, culture and capital structure. Donna would also like to compliment the openness and transparency CFO Marc Rivers has brought to both the reported financials and the board packs.

“It’s really important we understand what creates value in a global business of this scale and transparent financials go a long way in understanding the drivers. “ Now, after six years as an elected director on the Fonterra board, Donna steps down come

‘THERE WAS A DOMINANT LEADERSHIP CULTURE IN THAT BOARD AT THE TIME, AND THAT’S NOT HOW HIGHLY EFFECTIVE BOARDS RUN - YOU NEED TO RUN THE FULL SKILLS OF THE WHOLE TEAM.’

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Donna Smit:‘

‘NO MATTER WHAT BOARD YOU ARE ON, YOU HAVE TO WORK OUT; HOW DOES THIS BUSINESS CREATE VALUE AND THEN HOW DO YOU GO AFTER THAT VALUE?’

November from her two terms, a period over which the co-op has has seen a see-saw in prices from the highest forecast farm gate milk price (2021-22 forecast midpoint $9.30/kgms ) to in 2019, the worst reported net loss after tax in Fonterra’s history (a $605 million loss, due to a $826m write down and one-off accounting adjustments to DPA Brazil, Fonterra Brands NZ and China Farms.)

“It feels good what we as a board achieved. I really encourage farmers to stay engaged, this is the strength of the co-op. A lot has been done but there is still a lot to do.”

Peter McBride is chairman and on behalf of the co-operative’s farmers, thanked Donna for her contribution.

“Donna has been a valued member of our board at a critical juncture for the co-op as we have overseen the reset of the co-op’s culture, long-term strategy, governance and risk settings, and our capital structure.”

At the time of the business reset it was incredibly challenging, and Donna reflects that, “It was a very necessary thing, a very cleansing thing, sometimes there is nothing like a crisis to create change. I remember thinking; ‘We are going out to talk to farmers with the worst financial results in Fonterra’s history, but as we were coming out with openness and transparency, farmers were very appreciative of this.’

“A big challenge of being on the Fonterra board is the enormity of the decisions and how it affects the livelihoods of 9500 farmers. I mean you just cannot please everyone. The decision to change to a flexible capital structure is the right decision but was highly impactful - we have affected our shareholders’ balance sheets with the strategy to improve them for the future.”

Donna lists examples of what she perceives is the value of a company. For example, with Primary ITO its assets are people and their ability to train and teach a curriculum. EastPack is a post-harvest provider in a highly competitive market, so they need to pack efficiently at a low cost and ensure any investment in automation and technology not only gives a return on investment but also looks after the grower’s fruit. That is how they create value.

“At Fonterra we have many competitive advantages: • We are world leaders at efficiently producing whole milk powder through scale dryers that operate to the grass curve (ie: produce milk when the grass is there).

• Our scale allows us to produce the right product and to sell to the best customer as market dynamics change, an example of this was during the China Covid lockdown, we changed the

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

product mix from food service to ingredients and maintained profit.

• We have over 150 years of investment in dairy innovation, and we are very good at meeting our customers needs with the right formulation.

• Our scale allows us to load whole ships, and this was useful during the Covid supply chain disruptions.

• NZ is the best place in the world to keep a cow from a sustainability lens it will take investment to ensure we stay ahead.

Donna sees we can add value with our sustainability credentials and meet the demands of the most discerning consumer, and governors must ensure farmers get a premium for this.

“When I arrived on the board six years ago, sustainability was about fencing waterways and riparian planting. It is so much more today. Climate change has become a major focus for governments, producers and supply chains globally. The need for sustainable products is now customer led.”

Every business is considering how it can be more sustainable and farming is no different.

“I know it is unpalatable to many, but we only have to look to the Netherlands to see the demands being placed on Dutch farmers in the south to cut nitrous oxide and GHGs to understand the power of the consumer.”

Onfarm with Donna Donna is chartered accountant for Corona Farms: the family owns two dairy farms in the North Island and two in the South, another two have been sold, one to each of the Smits’ sons as they work through a succession plan. They also have support blocks, kiwifruit orchards, a beef farm, and forestry.

Corona farms have never used a lot of nitrogen and it is easy to come in under the 190kg N/ha limit, particularly in the North Island, but also achievable on the South Island farms.

A way they looked at practising sustainability on the South Island farms was to switch from border dyke irrigation to pivots.

“In the early 2000s we thought borders were elegant as they didn’t use electricity, but we now know that they leach nitrogen and use a lot of water, so have undertaken a programme of capital development and now have all our farms under spray irrigation.”

Family time will be a priority after she steps down, as there hasn’t been much of that in the past, and Donna alludes to a couple of projects – as well as looking forward to being able to sleep - there was never much of that the night before a board meeting even though the board papers were always well presented and an interesting read.

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BUSINESS PROFITABILITY

PELLETS AND PAKIHI A Takaka Valley farm is consistently at the top of the region’s operations for profitability, Anne Hardie writes.

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F

or the past five years, Rosser Holdings in Golden Bay has consistently been one of the most profitable dairy farms in the Top of the South’s DairyBase data, reaching $3449/hectare last year compared with the average of $2319/ha.

On a cold July day, the Rossers were one of two farms in the bay to open their gates for a field day to explain how they balanced production and costs to lift profit for their business which is owned and managed by Roger and Shirley Rosser, with their son Robert and his wife, Cindy.

The business near the top of the Takaka Valley encompasses a 165ha milking platform and an adjoining 85ha support block where the cows winter for six weeks. Between 530 and 535 cows are milked through the season which is close to 3.1 stock units per hectare. The herd consistently produces about 220,000kg milksolids (MS) through efficient grass utilisation and also up to 380 tonnes of pellets fed in the dairy.

The most recent data was evaluated from the 2020-21 season which showed the Rosser family produced an operating profit of $2.56/ kg MS compared with the benchmark of

$2.29/kgMS to give an operating profit margin of 31.4% compared with the benchmark of 28.9%. Operating expenses for that season on the farm was $5.59/kg MS compared with the benchmark of $5.63/kg MS. During that season, the farm harvested 12.4t DM/ha compared with the benchmark of 11.1t DM/ha and pasture made up 76% of the cows’ diet.

The barley-based pellets have been a consistent addition to the cows’ diet on the Rossers’ farm and despite the cost of the imported feed, it is part of the equation to successfully achieve high profit. The cost keeps going up though and Robert acknowledges the sight of a truckload of pellets showing up at the farm scares him sometimes because he knows how much that truckload costs.

Freight alone costs $117/t for the truckload so he reckons you might as well buy a good pellet. That said, the price for pellets has risen by 30% in the past year to $670/t which makes budgeting difficult. If more Canterbury farmers switch from palm kernel to barley, he expects the price to continue to rise. But he likes the barley pellets and they have worked well for cow nutrition as well as cow flow.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

“Pellets are lollies. We had to put rubber mats down because they want to get in there. Some cows will back off and try to jump on again – they get quite cunning.”

He starts feeding high-energy pellets to the springers from July 20 and keeps feeding them through to the end of mating, when the rocket-fuel variety are swapped for a cheaper, basic pellet for the rest of the season.

The herd gets 2kg/cow of the pellets daily for most of the season and can be fed up to 4kg a day in September to get the cows humming.

Every year the cows are fed the same amount regardless of the milk payout.

Minerals are fed separately through a dosatron dispenser, using a mix that was made up by the Rural Service Centre years ago. This is Left: Three pivots are part of the high capital costs for the farm. Below: Barley-based pellets have been a consistent addition on Robert Rosser’s family farm.

about to change though, with a mineral pellet feeding system being installed in the dairy to replace the dosatron system. Robert says that will guarantee each animal receives the correct dose of minerals daily as dosatron does not serve every paddock and cow intake can vary.

Pellets are fed in the 50-bail rotary dairy which is part of the higher capital costs on the farm, including pivot irrigation and machinery, but also one of the reasons the farm can run more efficiently.

Two staff members work alongside Robert on the farm and the dairy is a one-person operation at milking. That frees up time for one of the employees to do other jobs around the farm instead of helping with milking. During spring, employees get to sleep in twice a week because they aren’t both needed in the dairy.

Anyway, Robert likes morning milkings.

“I like milking cows in the morning because

‘PELLETS ARE LOLLIES. WE HAD TO PUT RUBBER MATS DOWN BECAUSE THEY WANT TO GET IN THERE. SOME COWS WILL BACK OFF AND TRY TO JUMP ON AGAIN – THEY GET QUITE CUNNING.’

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

FARM FACTS • Farm owners: Roger and Shirley Rosser, with their son Robert and his wife, Cindy • Location: Upper Takaka, Golden Bay • Milking platform: 165ha • Support land: 85ha • Herd: 530-535 crossbred cows • Imported feed: 2kg/cow barley-based pellets through season and up to 4kg in spring • Production: 220,000kg MS • Profitability: $3449/ha last year compared with the average of $2319/ha

no-one annoys me and I get a good look at the cows.”

Money is spent on machinery for mowing, balage and spraying, but Robert says it enables them to make big savings by being able to carry out those jobs themselves. Plus, it makes good use of the staff they employ. Keeping up with repairs and maintenance is a key aspect of the business.

“I try to buy new gear all the time because I hate old gear breaking down.”

Most years they try to make balage and will take a paddock out of the round for three to four weeks to make quality balage straight out of the round, then have it back in the 24-day round they follow throughout the season. Balage and hay are also made on the neighbouring support block which means it is not far to carry it to the milking platform where balage is fed through summer and also autumn to slow the round down. Light balage gets chopped so the cows eat it better and they will often get a second or even third cut off a paddock.

Having their own equipment means they can get good use out of nitrogen in the form of N-Protect by spreading it behind the cows at 50kg/ha when the weather allows through spring and that keeps the grass growing for the higher stocking rate. On the irrigated land they apply 160-170kg/ha/year and on the unirrigated paddocks about 100kgs/ha.

The three pivots are part of the high capital costs for the farm, but integral to keeping pasture growing through dry summers on river flats and terraces. Soils over three terraces go from gravel to silts to pakihi on the hill block and the bottom part of the farm is 30% more productive than the hills. Adding irrigation to the productive soils keeps the grass ticking along nicely.

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Pakihi soils cover the hills above the river flats and lower terrace.

COST CONTROL CRITICAL Five years of data in the Top of the South shows it doesn’t matter whether farms have a low or high-input system to achieve high profit, but rather the ability to control costs.

Nearly 40 farms in the Tasman and Marlborough region now provide data for DairyNZ’s DairyBase and 28 of those for at least three years.

Profitability varied on farms over the years, though top-profit farms consistently ranked in the top five farms and proved that every system can be profitable, whether it is system 2 or system 5.

In line with national data, the data confirmed a strong and consistent relationship between the amount of pasture and crop eaten per hectare and operating profit per hectare.

Though there was no relationship between purchased nitrogen and profit.

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Water consents from the Takaka River don’t guarantee water though. It depends on whether or not the Cobb Power Station is generating power. When it is really dry, the water can be turned off two to three times a day which means it is not possible to run three pivots at once.

When westerly winds whip down the valley, the pivots can struggle to keep up with the loss of moisture from the soil. The pivots cover 70ha, with another 40ha irrigated via K-line. A TracMap unit on the bike has made it easier to move the K-line irrigation and Robert says they are growing more grass in those areas now.

Cows are split into two herds for the entire season, with mature cows milked twice a day on the irrigated pasture and the younger cows milked once a day from Christmas on the unirrigated land. The latter have the furthest to walk to the dairy and get topped up with balage when it gets dry, plus pellets in the shed.

No summer crops are grown and likewise no winter crops. Running a higher stocking rate makes it difficult to take too many paddocks out of the system for resowing and an alternative is undersowing damaged paddocks to top up pasture. When they do regrass a paddock, they spray it out and sow it themselves which means they have flexibility to get it done when they want.

Some of the pastures are 20 years old and Robert says lack of longevity is one of the problems with many of the newer pasture species.

The older pastures can get a bit clumpy though and need to be topped regularly through the season to control quality. Key to the business is keeping everything simple and staying consistent with fertiliser, feed and cow numbers to ensure the success of the following season.

Part of keeping it simple is a laid back approach to mating. After years of breeding the original Ayrshire herd toward crossbred using both Friesian and Jersey genetics, the farm now uses

crossbred straws for mating and only uses artificial insemination (AI) for three weeks, with the bulls put with heifers the same day they begin AI. “The technician turns up and whatever cow is on the platform gets a straw. Easy, simple.”

Six-week in-calf rates and submission rates are only slightly above average and mating continues for 9.5 weeks. But for the past three seasons the empty rate has been between eight and nine percent, without cidrs, vet checks or basically anything and the goal is to continue to keep it under 10%. The lower empty rate ensures they get about 110 replacements each year and hence there is no need for sexed semen. Instead, they have heifers to sell. Cows have longevity in the herd and Robert is quite serious when he says they try not to keep cows beyond 11 or 12 years old. Calving kicks off from August 5 these days because irrigation gives them the ability to grow more grass through summer and didn’t have to rely on more days in milk to compensate for the dry. The breeding value (BW) for the herd is 137 and production value (PW) 187, with Robert conceding some cows dip into negative values, but that is no concern to him. As long as a cow is proving herself with milk into the vat, he is happy. On average, cows produce about 410kg MS to 420kg MS. Though the business is production-focused, with higher stocking rate utilising the pasture they can produce, Robert says they don’t chase production and that’s another reason for keeping the system consistent. The focus now is on tweaking some areas such as grass management to produce a bit more milk and shopping around for products to cut costs where possible.

Hanging over the farm and several others in the area is the Te Waikoropupu Springs water conservation order that recently went to the Environment Court. The issue has been around the source of nitrates in the springs and whether they are natural or due to human activity.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

THE RISKS ARE LESS RISKY WHEN WE’RE PART OF THE PICTURE.

Moving ahead means making changes. And that usually comes with a few risks along the way. But with us as your partner, you can progress with more confidence. That’s because FMG offers the kind of specialised advice and knowledge that only comes from working alongside rural New Zealand for generations. To find out more, ask around about us. Better still, give us a call on 0800 366 466 or go to fmg.co.nz. FMG, your partners in progress.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

35

BUSINESS PROFITABILITY

Farming among the rocks The Chubbs stick to grass for the cows on their Golden Bay farm.

By Anne Hardie.

FARM FACTS • Owners: Rob and Cherrie Chubb • Location: Takaka, Golden Bay • Milking platform: 56ha • Support area: 26ha • Herd: 150 Friesiancross cows • Production: 65,000kg MS • System: grass only, including balage and hay • Operating profit: $3768/ha

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R

ob and Cherrie Chubb run a simple, grassbased system on their small Golden Bay farm and consistently rank in the top five farms for profitability in the Top of the South. Their 56-hectare milking platform near Takaka milks 150 Friesian-cross cows that put about 65,000kg milksolids (MS) into the vat consistently each year and in the 2020-21 season, the latest available data, returned an operating profit of $3768/ha or $3.22/ kg MS. The farm nudges into the top of a valley and sits on stony soils that are great for warming the soil up in early spring but are lethal to machinery. Rob describes rock gathering as a family tradition for Cherrie’s family that has farmed the land for about 70 years.

“We call them icebergs because you see a small stone on the surface and it’s just the tip.”

Years of rock gathering enables them to mow 90% of their paddocks now which means they can make balage to feed out during dry periods of summer or autumn, plus hay to fill the cows up in winter.

It’s the only supplement the cows get through the year, mown from either the milking platform or the adjoining 12ha support block or the 14ha lease block just down the road.

“The cheapest thing you can grow is grass so we just grow the most grass we can with the cheapest method. I don’t get to eat lollies and chocolates, so I’m hard on my cows and they don’t get them either.

We try to make them a nice boring life of eating the grass.”

They trialled maize one autumn and found the cost ruled out any gains. They also trialled palm kernel and got sick of lame cows, the wastage and dustiness of the feed. It required infrastructure and that was a cost. So they returned to grass and it is profitable. Cows head off to the support and lease block for winter and spend seven weeks there on saved pasture, balage and hay. The stony ground rules out winter crops even if they wanted them. Robb says the finance on the support and lease blocks is cheaper than sending the cows away on a truck for grazing.

A reliance on grass means they have to do it well. Thanks to a relative who was a surveyor, the farm is split into even-sized paddocks which makes rounds easy and also shifting the K-line irrigation. Then Rob came along with a civil engineering background and wanted to have more than just eye appraisal to help with pasture production.

“I bought a platemeter – maths and science - so I could see how much grass grew in every paddock every day. Then I got older and wiser and now I can just look at the grass.”

Residual is everything, he says, and by running a set round on similar-sized paddocks and achieving quality pasture, they know what their cows are eating. Total feed eaten for the farm during the 2020-21 season was 14.1 tonnes/ha and that same season the cows turned that into 1172kg MS/ha which averaged 446kg MS/cow. The whole operation, including young stock, consumed 15.9t DM/ha and 76% of that was pasture on the milking platform. Another 11% was grazing replacement stock on the support and leased areas, plus 9% for wintering the cows off the milking platform and 4% was supplements made on those support blocks and brought to the milking platform. To rely on pasture, they need irrigation and the Chubbs put down a well 11 years ago as they have no direct river access. They priced a pivot for irrigation, but they would have needed to remove most of the totara trees scattered around the farm and still require K-line in the corners of the paddocks. The regularity of the paddocks makes it easy to shift the K-line and Rob says it only takes an hour and 20 minutes a day.

“You have to have something to do.

Otherwise you’d have to be at the beach swimming.”

Like many Golden Bay farms, their pasture is cursed with giant buttercup and it is a constant battle to keep it under control. Rob says they can hit it hard with Preside or its equivalent and that keeps the weed at bay for about 18 months and they need to be careful Dairy Exporter | www.nzfarmlife.co.nz | August 2022

not to pug ground or the buttercup will take advantage of the broken ground.

Tordon’s PastureBoss “certainly killed buttercup but also killed everything known to man”.

Targeting the yellow-flowering weed with herbicide takes its toll on clover though and it is always a balancing act deciding whether to spray or not.

Hitting buttercup with herbicide is such an ongoing job that they have their own sprayer and do the job themselves.

Topping the weed hard is another option when they have a year of major grass growth. Pasture is everything and Rob and Cherrie focus on protecting the soils so they can grow good pasture. Gateways are fenced off to protect the ground and springers are moved at least twice a day to reduce damage. For the past eight years they haven’t resown any paddocks because they have avoided damage. Prior to that, the entire farm was resown over four years. Keeping it simple on the farm means they don’t require much machinery which is why their current tractor replaced a 1973 model they had used for decades.

Being efficient means ignoring salespeople

and only buying what is necessary.

Rob says they do spend money on animal health, though good breeding over 40 years has resulted in healthy, structurally sound cows suited to the grass-only system. The herd comes from a predominantly Friesian base and they have moved to crossbreds for hybrid vigour, a smaller cow and to improve fertility. Initially they used Friesian and Jersey genetics to produce crossbred cows, then switched to a combination of Friesian, Jersey and crossbred semen a couple of years ago.

Mating is a DIY job where they carefully select each bull for each mating to maximise the genetic gain for each individual. After three weeks of artificial insemination (AI), Angus bulls go into the herd. When they were transitioning the herd from its Friesian base to crossbred cows, Rob says there was an obvious difference between the black and white cows waiting for their feed and the crossbred spread out around the paddock with their heads down.

Cows are milked twice-a-day through the 16-aside herringbone dairy until the

Cherrie and Rob have a grass-based system that ranks in the top five for profitability.

middle of January when the Chubbs switch to once-a-day to reduce heat stress in the animals. Rob says the cows can hold their milk so it seemed a no-brainer to milk just once a day and they keep to that milking frequency through to the end of May. Their son, Oscar, joins them on the farm between April and October and Rob concedes they are labour inefficient. It means they “only work half the time but do it every day”.

“A good day on our farm is getting up, milking the cows, putting them in the paddock and walking away.”

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

37

SYSTEMS SOUTHERN DAIRY HUB

OUT TO G GRASS The Southern Dairy Hub has been experimenting with grass and balage, for wintering.

Story and photos by Karen Trebilcock.

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rass and balage wintering, tried for the first time this winter at the Southern Dairy Hub, was not the good look more than 100 visitors at the July 6 field day were expecting to see.

On the dry day, cows were resorting to lying on balage only hours after they had been given the new break.

General manager of farm operations Louise Cook said they had been told by other Southland farmers who were wintering on grass and balage to “make sure the grass was short so it was in an active growing state”.

The grass paddock shown at the field day not only had a low cover but the grass structure was open. Those there were getting their gumboots stuck in the areas yet to be grazed.

The Hub had found balage hard to come by due to the extended summer dry experienced by the region and she would not say how much bales had cost but, as they were of different weights and quality, it had been difficult to do feed budgets.

However, the Hub had estimated the cows were getting 12kg drymatter (DM) from the balage and “any guess” from the grass. Bales were set out 100 per hectare.

A breakout had resulted in the death of a cow after it ate the plastic wrap when trying to get to the balage.

“We asked the staff whether they found it easier to shift the cows on fodder beet, kale, swedes or the grass and balage and they all said the grass and balage.”

Louise showed two film clips at the field day she had taken during a wet spell in June at the Hub which showed cows standing in water in crop.

“When we sowed the crop paddocks we decided to have areas of Italian in each paddock that we could let them on if the weather turned bad but these areas, when it rained in June, went under water.”

Instead, bales of straw were dropped over the fence from the laneway and rolled out for the cows to stand on.

Back fences were also taken out so the cows had more area to find places to rest.

“We’re feeding crop into the weather this winter and the driest areas are always the crop face but the weather can push the animals away from it.

“We’re finding we need a plan B, C, D and even E and F when it rains.”

Results from a winter crop cultivation study

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

‘WE ASKED THE STAFF WHETHER THEY FOUND IT EASIER TO SHIFT THE COWS ON FODDER BEET, KALE, SWEDES OR THE GRASS AND BALAGE AND THEY ALL SAID THE GRASS AND BALAGE.’

Wood chips, NUMAT double stud 23mm interlocking rubber mating (left) and 50mm shredding rubber pour in place surface with NUMAT Cow carpet glued on top.

by the Hedgehope-Makarewa Catchment Group and the Hub showed mixed results with yields suffering when crops were direct drilled compared with those sown with conventional tillage.

“We have a lot of raw data from 10 commercial farms plus the Hub, we had an army of volunteers collecting it, and we’re still looking at it all,” DairyNZ senior scientist Dawn Dalley said.

“Although no-till options were more environmentally sustainable from a carbon and soil structure perspective, an unintended consequence was the increased need for chemical weed and insect control to achieve a more sustainable yield in the winter crop and also when returning the area to permanent pasture.”

Weeds and debris left behind after spraying proved a haven for insects and there was poor plant survival due to insect damage and competition from weeds.

Water also pooled on areas which had been direct drilled which lessened cows’ lying times when they were fed the crop but there was less pugging. Dawn said the study showed it was the daily management of grazing stock which had the greatest impact on soil damage, rather than soil type or crop establishment methods.

“It highlights having a winter grazing plan, with well-planned crop husbandry and stock management supported the best wintering success,” she said.

“Farmers who carefully assessed their own situation, adapted what they did as conditions changed, and had good systems in place, had the best outcomes.”

Planning at the hub was continuing for the building of an off-paddock wintering area for next year.

Testing of possible surfaces had started with three trials at Paul and Dani Hardegger’s dairy farm at Isla Bank, half an hour away. (see story pg42, Dairy Exporter July 2022).

Although wood chips have long proved to be preferred by cows, the Hub was also looking at NUMAT interlocking rubber matting and two types of rubber chip with NUMAT Cow Carpet glued on top.

How soft the materials were, whether the cows found them slippery, how easy they were to clean and whether they harboured bacteria would all be looked at as well as affordability.

“We want to look at these surfaces because if everyone in Southland chooses wood chips there would be supply issues.”

The wintering barn at the Hub would have two designs, Dawn said. One would be using woodchips and have a roof as well as a smart gate which stopped cows returning to the woodchipped area to reduce the amount of effluent on it.

Left: Mud, mud and more mud – cows lie on expensive balage at the Southern Dairy Hub’s trial of grass-only wintering.

39

SYSTEMS VIRTUAL FENCES

LOOK

no fences Technology has allowed the introduction of virtual fencing on farms with a range of resulting benefits.

By Pete Morgan.

Without the constraints of fences, Pete Morgan says his cows can be just cows.

W

Pete Morgan and his farm pooch are reflecting on the advantages and flow-on effects of having no fences.

40

e have so much new tech and data to sort through and try to understand.

Feeding pasture and moving animals is still the basic thing we do. It keeps the routines happening and maintains the base production driven by forages in New Zealand.

It’s worth just looking at virtual fencing by itself as a concept and what it might mean to pasture farming in NZ. The concept has been explored for a while and now reliably works, but what does it mean to how we could farm? Any changes to our systems still need to do a better job of the fundamental parts of farming, not complicate them. We have flexible tools that easily allow us to optimise our feeding and managing animals.

We are now in our second season of fully virtually fencing and moving of all animals. It’s been an amazing experience. It has uncovered a good challenge.

If you could manage your feed and animals without limitations, what is it you really want?

The reliability of our standard paddock and temporary fencing and the need for us to move animals ourselves have meant I always accepted my system as being as efficient as I could get it. Having a season to allow our farm to find a new optimum has come up with some unexpected findings and meant I’ve slowly let go of many of the ways I had.

Time. We’re all pressed for it and as we rightly

give our more staff healthy and reasonable hours we have managed to reduce them by 20%. Also, because we’ve taken out so much of the operational time we now have a higher proportion of time being more productive and learning. We now spend more quality time with the cows checking them, their behaviour, the pasture residuals and planning the tuning of the allocations rather than stuck behind them while moving them. Likewise, we spend more time measuring feed and planning the rotation rather than putting up fences.

Animals. We joke that the cows get to ‘be cows’ now. It’s nice to walk through them and have them largely oblivious to us. We are removed from having to push them everywhere and always being between them and the next feed. They have chilled out and have tightened their own social structure. This results in them moving more calmly while maintaining their pecking order that we would normally disrupt by forcing the quieter ones at the back through the more dominant ones not moving at the front. And like traffic management on the motorway, it looks like you’re going slower but good flow means everyone gets there faster.

Mobs. We run more mobs when we need to and less when we don’t. Any time that a group or individual will benefit from being grazed separately we don’t give it a second thought. Conversely by being able to hold up on any area and move to feed as the last cow reaches the paddock we can create even opportunities for all of them by enabling larger mobs typically after calving has finished.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

Accounting for where animals are and being able to take action in any events will be important to the credibility and relevance of NZ dairy’s products.

Feed. If our profitability is primarily driven by our ability to grow and utilise high quality feed, this has always meant we need to allocate accurately and maintain good, even residuals. This is an area of management that our handbrake

has completely come off. As a break is drawn on the app the number of cows and area are shown and we can get it right every time. The lines don’t need to be straight and can merge with the contour and account for any sensitive areas. We have multiple breaks in the day accounting for quality (graze the lower quality feed first), contour (control the slopes and seedhead) waterways (alter the distance according to rainfall), supplements (prefeed on higher NDF pasture before maize silage) and fertility (graze high fertility areas hard and have the stock camp on the lower fertility areas). Cropping will feature more for us in the future as we can grow and feed it however we want with bigger paddocks and using any strip feeding shape we want. I don’t miss fencing turnips.

Paddocks. Have we taken all the fences out then? No. In fact I encourage farmers to leave them in unless it is in the way of you farming how you want. However, paddock size does limit our options to allocate the right amount of feed and have more choice. We have taken a third of ours out - all the triangles, small and unnecessary paddocks. The materials have been reused for our planting and repairing work. Ultimately we will take more out and end up with 12 ‘blocks’ of 10ha per farm, each bordered by the boundary, race and waterways or wetlands. What we have opened up so far does look amazing.

Environment. Pugging, proximity to waterways, sensitive contours and extreme rainfall events are now managed with simple plans that move mobs any

time of the day or night to eliminate or minimize our impact. Outputs from tracking will be important to managing fertility, welfare and impact on soils. We can accumulate hours spent on areas of the farm represented in a heat map, where colours represent higher accumulated time by the stock.

Welfare. There is no doubt that our ability to demonstrate optimal care for our animals 24/7 is going to be scrutinized more but also has huge opportunities for adding value to our products and maintaining our credibility and relevance in the world. Most cow tech will help move our practices to improve this but accounting for where animals are and being able to take action in any events will be important. Extremes of wet, hot, cold and stress will require plans and evidence of action to show our delivery on the needs of stock. We move all mobs in sync at dawn and have moved many troughs to mean breaks can involve as many as possible.We have been amazed how our young team have taken to our changes. They have the capacity to take full responsibility for all these above areas and incorporate them in every break or move they action and value getting out to measure feed and walk through the cows to make better decisions. Ultimately these are just tools and we need to still be smart about how we use them.

The discussion around where we want our industry to go and what outcomes are necessary are challenging but healthy and should stimulate solutions for everyone to benefit from.

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SPECIAL REPORT

COUNTING ON COWS What’s the outlook for cow values and can you still bank on them?

44

CASHING IN ON COWS

50

A WIDENING QUALITY GAP

52

ELIMINATING BOBBIES: A PAN-INDUSTRY REQUIREMENT

55

COW VALUES: IS THE DREAM RUN OVER?

58

SURPLUS CALF VALUES SET TO CRASH

Cashing in on cows SPECIAL REPORT

Despite a late start and bumps along the way, the O’Malley’s have achieved farm ownership in their target West Coast district. By Anne Hardie.

EVERY FENCE POST, TREE, CLOD OF dirt and shed on Christopher and Siobhan O’Malley’s 80-hectare farm near Hokitika belongs to them after successfully reaching their goal of farm ownership. The city-born couple who were late starters on a career path in the dairy industry have got there through scrimping, saving and selling, with no financial help.

The thermometer goal chart on their fridge shows the gradual climb in savings that was needed to get them over the line with the bank for financing their farm purchase.

Their three kids knew the importance of that thermometer and helped colour it in as it grew toward a target of $300,000 cash in the bank to bolster the equity built up in a liquorice-allsorts herd of cows.

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Farm facts Owners: Christopher and Siobhan O’Malley Location: Kokatahi, West Coast Milking Platform: 80ha Herd: 180 liquorice allsorts Budgeted production: 70,000kg MS Dairy: 22-aside herringbone

When they first began to dream about farm ownership - and Christopher confesses they are big dreamers - the idea of spending millions of dollars was beyond their comprehension and even beyond their conversation. So they forced themselves to talk about big numbers to build their awareness and confidence.

“We just struggled to even talk about big numbers because our life experiences didn’t have numbers of that scale,” Siobhan says.

“We started to talk about a $3 million farm even when we only had $20,000 in equity so we weren’t intimidated.”

“If you are too scared to talk about it, you can’t do it,” Christopher adds.

The O’Malleys are well known in the industry after winning the Sharefarmer of the Dairy Exporter | www.nzfarmlife.co.nz | August 2022

Year title in the 2017 New Zealand Dairy Industry Awards and also for their innovation. Siobhan is a co-founder of the Meat the Need charity where farmers donate livestock and more recently milk to be processed, packed and delivered to city missions and food banks around the country.

More recently she has teamed up with Merino farmer, Paul Ensor, and sales and marketing powerhouse, Harriet Bell, to produce a merino-hemp yarn called Hemprino. It has meant travelling to China on an Agmardt grant to complete research and development with a yarn manufacturer to combine the two fibres for the startup.

Both began careers far removed from dairying.

Siobhan followed her passion when she left school and gained a degree in Classics, including Latin, and though she says it taught her to think and analyse things, job pathways were scarce. Consequently, she added teaching qualifications and became a secondary school teacher.

“I was told to study what I enjoy and a career would sort itself out - which is a misleading statement in Classics.”

Christopher headed into adventure tourism and spent several years having a wonderful time in places such as the Abel Tasman National Park, guiding kayak trips and then Ireland when they spent time there on their big OE. But it wasn’t leading to a career.

Returning from Ireland in 2009, Christopher got a job as “the boy” for his brother, Ant, who had a lower-order sharemilking contract on a Canterbury farm. He had some inkling about dairying – or at least milking – after spending holidays on his grandparents’ small dairy farm at Kokatahi inland from Hokitika where they milked 40 cows. His grandparents had a ballot farm just a stone’s throw from where Christopher and Siobhan now live on their own farm and he says it is a bit like returning to his turangawaewae.

“I feel like I’m where I should be.”

Pushing for progression Starting later hasn’t held them back in the industry and Siobhan says it was in some ways a gift because it meant they had no preconceived ideas about dairying and they followed their own path.

Progressing their career in dairying has meant moving constantly, often between regions and Siobhan says those working in the industry sacrifice their connections with communities when they Dairy Exporter | www.nzfarmlife.co.nz | August 2022

move to other farm jobs and it isn’t easy. It is one of the reasons they aspired to farm ownership where they could have a permanent home for their children, Finnian, 10, Aisling, 8, and Ruairi, 6.

Siobhan has an Irish background from generations back and the Irish names are a family tradition.

“I was lucky enough to find someone with an Irish surname!”

Between that first Canterbury job and farm ownership, they have had five sharemilking contracts between Canterbury, North Otago and the West Coast. Along the way they entered the Dairy Industry Awards three times which culminated with winning the national title. The first time they entered in 2013, they were variable-order sharemilkers in the West Coast’s Grey Valley. That first entry was all about finding out about the awards and using it as a learning experience. They won a couple of prizes and learnt a lot.

Left: Christopher and Siobhan O’Malley with Ruairi and Aisling.

Above: A supplier number that belongs to them.

45

When they entered again in 2015 when they were variable-order sharemilkers in North Otago, they admit their entry was a train wreck. They were trying to juggle their entry and all that entailed at the same time they were looking for a new job before the farm they were on was sold. Travelling to job interviews around the South Island took precedence over the awards.

They moved on and in 2017 as herd-owning sharemilkers and with three young children, they spent months working on their entry after the kids were in bed and were confident by the time they presented their business to the judges.

“It became a bit of an obsession,” Siobhan admits. “But through that process we thought there was no bloody way we were going to be able to buy a farm.”

Back in 2013 when they were lower-order sharemilkers they discussed the goal of buying a farm on the West Coast, but their accountant initially laughed at their idea of the timeline to get there. But they hadn’t given up on the idea.

Then they won the sharefarmer of the year award and were offered some opportunities to become equity partners. But when they sat down and worked through it, they realised they just didn’t have the money to do it and they didn’t want to be a long-term minority player in a partnership.

Disenchanted about their goal for farm ownership and burnt out from years of chasing the goal, they quit the industry.

A new direction took them to Motueka for something completely different - managing a small hop garden and beef operation. It was an interesting

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‘We just struggled to even talk about big numbers because our life experiences didn’t have numbers of that scale.’

position at the local secondary school so they would have a history of regular off-farm income to help tick the boxes with the bank. To buy the farm, they sold more than 200 cows and took the leftovers with them, confident that feeding them right and looking after them will produce results in the vat.

“We knew if we fed them well we could do well because we knew our skill set,” Siobhan says.

Counter cyclical with cows Left: Aisling with the thermometer goal chart that the kids coloured.

Above: A farm walk over their own paddocks.

interlude and they learnt about a different industry, but it wasn’t what they were after.

In 2019 when they were still working with hops, they went to the West Coast to be judges for the regional awards and returned home fizzing. It made them acknowledge their love for dairy farming and they wanted to get back into it. Not just anywhere though - they wanted to be on the West Coast where they could settle into a long-term community.

And they wanted to chase that goal again of farm ownership and this time make it happen.

Two years ago and back on the Coast with a sharemilking contract, they had a herd of 400 cows and $100,000 in the bank which wasn’t enough to buy a farm and they had spied the farm they wanted just by the Kokatahi-Kowhitirangi School.

West Coast farms were sitting on the market for a long time after years of Westland Milk Products’ low payouts before Yili bought the former cooperative.

The bank required them to have $300,000 in savings and in the past two years they have managed to add another $200,000 and the thermometer goal chart shows that progress.

Last year Siobhan took on a full-time teaching

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

Throughout their dairying career, they have been making equity gains by buying the cheapest herds, then looking after them so they could resell the herd when prices peaked. Christopher says banks don’t grade cows, so whether it is a top BW cow or one with three teats, it is all the same to the bank when it comes to equity and for sharemilkers striving to buy their first farm, it is all about equity.

“We had 400 cows including some empties and sold the best. That left us with old girls, three titters, unwanted and a smattering of half-recorded cows which left us with a ragtag crew to take us through this year. But the bank value is the same as the cows we just sold, so that’s your equity.”

Twice in the past they have sold A2 cows from herds they have purchased and replaced them with other lines of cows at a lower price so they could put money in the bank. The first time they sold A2 cows was during the 2015-16 season which was their first year as 50:50 sharemilkers and the payout plummeted to $3.80/kg milksolids (MS).

Siobhan says they still have post-traumatic stress from that year and many sharemilkers were lost from the industry. They traded about $200,000 in stock that year and between trading and milk 47

production they ended up with a profit of $10,000 for the year instead of debt.

They have always paid low prices for their cows.

The first herd they put together was cheap at an average of $1175 per cow and their latest herd of fully recorded cows cost them on average $1050 per head landed. They bought the herd in late May when herds are traditionally cheapest because people are desperate to find a new home for them. In a poor year, cow prices are up to about $1500 and in a top year they can be up to $2200. Buying cheap has enabled them to carry less debt and make the most gain. When they sell cows, they sell them before Christmas when most buyers are wanting certainty about their herd for the following season and will pay a premium to secure cows. The 200 they sold to buy the farm were sold before Christmas but stayed in the herd through to the end of the season. They had previously bought them in May, so there was a good margin when sold, even if they did not get the highest price in the market. Christopher says you have to be prepared to take a risk when you don’t buy your herd until May. But buying herds late in the season has worked for them.

“We’re counter-cyclical investors.”

“It sounds risky, but it’s downside mitigation,” Siobhan says. “We would pay up to $1500 for a cow and once paid $1600 which was outrageous for us. As herd owner/sharemilkers we were obsessed with cow prices and what buyers were looking at for breed and BW and PW.” “You are always thinking about selling your herd, because you have to sell,” Christopher adds.

They also synchronised their heifers last year, used sexed semen and calved slightly earlier than their neighbours so they could sell the cows to a wider market of buyers.

Reaping rewards of perseverance Getting to the finish line, they moved on to their own farm on June 1 and Christopher says he is 48

immensely proud about farm ownership.

“You can sometimes shoot for the stars and miss,” he reflects. “You work really hard to get there and if you are always going to be sharemilking, you never have that security and that is what we were after.”

“That’s why people choose equity partnerships,” Siobhan says. “It allows them to choose a piece of a farm and settle there. But that would have started to annoy us and we would rather be milking on a small farm for ourselves. That was just our personality. We really wanted this.

“We’ve been sprinting and really focused on this for a really long time. So it’s nice to go on to the next thing which is to pay it off.”

The Kokatahi-Kowhitirangi School is right next door to their farm and the kids know this is home and they won’t be moving any time soon.

“There’s a sense of relief,” Christopher says. “Not just for us, but also the kids. Now they have a home that is theirs. Because you are really renting homes when sharemilking.”

The kids knew the goal as Siobhan and Christopher talked about it openly in front of them, including the money they needed to save to make it happen. It has meant living frugally to keep debt down and save pennies – apart from one year when they splurged on a holiday to Australia.

“Five years ago they knew Dad had to milk the cows to put milk in the vat for the tanker to come for Fonterra to take milk and pay us so we could go to Australia.”

West Coast of opportunity Apart from family history and community, the Coast was the logical region to buy a farm. Land prices between $20,000 to $25,000 per hectare are half Canterbury prices, yet the farms produce more than half the production per hectare of those Canterbury farms which makes for better cash flow.

“We had to learn how to farm in the climate and how to manage the animals and land in this climate Dairy Exporter | www.nzfarmlife.co.nz | August 2022

and so we were sharemilking here before we bought,” Christopher says.

Before buying the farm they also talked with the farm’s owner and neighbouring farmer who had lived there for 50 years and was able to provide information that will help them through their first season.

This spring, they are milking 180 cows in their very own dairy – a 22-aside herringbone. Young stock are grazed off and most of the cows were also grazed off through winter. They are budgeting on 70,000kg milksolids (MS) and plan to feed about 400kg DM of palm kernel to the cows, mostly through spring to Christmas. Then they will reassess and may cull some cows rather than buy-in more feed.

They will focus on keeping a lid on costs and any surplus will be used to “smash the debt”.

Siobhan continues to be involved with Meat the Need on a voluntary basis and the Hemprino brand as a business venture. If that wasn’t enough, the pair also want to be involved in the direction of the dairy industry. This year Siobhan starts a new role with Muka Tangata: Workforce Development Council for food and fibre sector and Christopher is chair of the West Coast Focus Farm Trust.

Left: The O’Malleys bought cheap herds and sold the best cows to make equity gains. Above: Ruairi and Aisling.

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49

A widening quality gap SPECIAL REPORT

The value difference between the good cow and the not-so-good is set to grow. Anne Lee reports.

Phil Journeaux.

THE VALUE GAP BETWEEN GOOD quality and poorer quality cows is likely to widen as environmental regulations begin to bite, the national herd heads towards a possible contraction and live exports cease. That could bring challenges but also opportunities to how cows are viewed as an asset.

Dairy cow numbers peaked at about five million in 2014 with numbers dropping

ANGUS

but hovering about 4.9m since.

AgFirst agricultural economist Phil Journeaux says there’s now downward pressure on cow numbers as farmers look to farm systems solutions that enable reductions in nitrogen surpluses and greenhouse gas emissions.

“I don’t think we’ll see any crash in dairy cow prices but what we may see is the value of poor quality cows dropping

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IRD Herd Scheme Values 2000 2001 Dairy Cows $862 $1,313 Friesian and related breeds:

2002 $1,225

2003 $835

2004 $817

2005 $862

2006 $1,187

away and a greater differentiation in price,” he says.

High breeding worth (BW) and production worth (PW) cows will maintain their current value and may even see a lift as they become more desirable because of greater efficiency.

“We know from the work we’ve been doing on GHG modelling and farm systems options that a highly productive cow is going to be more desirable in terms of both financial return and not creating as many GHG emissions compared with a less efficient one.

“That’s going to be especially true after 2025 when GHG pricing mechanisms start biting.

“Work we’ve done shows that if you drop cow numbers by about 10% and lift the production of remaining cows – without increasing total feed inputs – GHG emissions drop by about 5% but the profitability of the farm business can be maintained.

“If you don’t lift the productivity of the remaining animals, farm profitability goes down very quickly.

Nitrogen and phosphorus regulations are ramping up too but can also be addressed in part by having fewer, more-efficient animals.

“If you can make the same amount of money by milking fewer cows, that’s going to solve a fair few environmental issues at the same time.”

“The main driver of cow values over the years has been the profitability of dairy farming but it’s also been influenced by other factors like demand for cows during those conversion years.

“Profitability will continue to be that fundamental driver but the factors that create price variations are changing.”

AgFirst managing director and agribusiness consultant James Allen says the cost of rearing a heifer to first calving will also continue to underpin cow prices. Over the last 20 years cow values have fluctuated but have trended upward. (See figure 1) The issue has been, for those going into herd owning sharemilking as a pathway to farm ownership, that the lift in land values has far outstripped any increase in cow values.

“In 1992 it took 14 cows to buy a hectare of land, in 2016 it took 22 cows and now – at $1700/cow and $52,000/ha for land it would take 30 cows. You need more than twice the number of cows now as you did 30 years ago.

“Cows and herd ownership as an asset, especially for young people have been and still are a good asset base to get into.

“They provide a good return on investment and they can be bought in manageable lots.”

A widening gap in cow prices could mean opportunities – a lower cost of entry for some and a higher value herd for others.

DairyNZ system specialist Paul Bird says a third of contract milkers in DairyBase have an income derived from stock with

2007 $1,245

2008 $2,150

2009 $1,312

2010 $1,378

2011 $1,766

2012 $2,155

2013 $1,873

Figure 1. Dairy cow values

their average net stock income $12,000/year. In 2021 the average herd owning sharemilker based on return on asset owned 500 cows and earned $93,000 in net livestock revenue.

The top 10% earned $142,000 in net livestock revenue which was about 12% of their total revenue. Generating income from stock sales can be an important part of sharemilker income as an add-on to profitably producing milk.

Return on assets from sharemilking have been difficult to beat and over recent years, with strong payouts, they have been particularly high.

“We’ve seen sharemilkers generating the value of their cows as revenue each year,” Paul says.

Extreme volatility during some periods has seen that return also fluctuate wildly.

There are risks that come with sharemilking in terms of milk price but also in the fact the job itself may not be secure, James says.

“It is also more difficult to secure larger sharemilking jobs.

“As well as a decrease in the number of farms we’re seeing a drop in the percentage of farms sharemilked.”

Over the last 10 years the percentage of 50/50 sharemilking jobs has dropped from 18.8% to 16.6% and the number of total herds milked in New Zealand drop from 13,892 in 2000/01 to 11,034 in 2020/21. The total number of 50/50 sharemilking jobs has dropped by 387 over that period.

“But stock are still a great means to get your foot on the progression ladder – as a contract manager or sharemilker,” James says.

‘I don’t think we’ll see any crash in dairy cow prices but what we may see is the value of poor quality cows dropping away and a greater differentiation in price.’

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

51

2014 $1,963

SPECIAL REPORT

Eliminating bobbies: A pan-industry requirement Getting rid of bobby calves from the dairy system could provide an opportunity for both dairy and beef industries. Anne Lee reports.

BOOSTING STOCK SALE RETURNS and eliminating bobby calves for the dairying system is likely to mean a shift to all artificial insemination using high genetic merit bulls but it’s also going to take a pan industry approach.

AgFirst farm consultant Bob Thomson has a stark warning – cutting bobbies out of the system could mean dairy farmers paying beef finishers to take poorer quality dairy beef cross animals off their hands.

He’s carried out a number of reports for Beef + Lamb New Zealand on the Dairy Beef Progeny Test (see story page 75) and has worked with both beef farmers and in the meat processor sector. Dairy farmers’ concerns over calving ease can be better addressed by using proven progeny tested bulls identified in the Dairy Beef Progeny Test.

“Ultimately it would be great to see a Dairy Beef Value Index for calves, based on the right recording systems, to determine the value of a dairy beef calf for rearing and finishing,” he says.

In the meantime, he’s developed a basic model which categorises calves based on their potential value as beef finishing animals. A steer

Bob Thomson.

calf with a Kiwicross mother and a beef sire with unknown genetics for instance would be classed B – medium value for calf rearing through to finished, whereas a steer calf with a Kiwicross mother and beef sire with above average genetics would be classed as an A. (Table one.)

The classifications are based on animal growth rates using the same pasture feed supply taking the animals from weaner calves through to finished. His modelling took the highest quality calf and assumed it was bought for $500 by the finisher. He then adjusted the purchase price of the lesser-quality animals to ensure the finisher received the same gross margin.

On that basis a category C heifer calf would have to be discounted so much that the finisher would need the dairy farmer to pay them $120.

(Table two.) The increased use of cow collar technology should make an all-AI mating easier and more acceptable to dairy farmers.

Bob says an ideal option in the future would be for sexed dairy semen to be used across the highest BW cows to give dairy replacements with the highest Dairy Beef Value Index semen, that could also be sexed semen to produce

Table 2: The Relative Value of a Dairy-Beef Weaner (benchmarked between Sex, to Bull Category A October purchase) $500 $400 $300 $200 $100 $0 -$100 -$200

52

Bull CAT A

Bull CAT B

Bull CAT C

Steer CAT A

Steer CAT B

Steer CAT C

Heifer CAT A

Heifer CAT B

Heifer CAT C

October

$500

$416.50

$321

$218

$140

-$106

-$37

-$49

-$120

November

$494

$430.50

$316.50

$238.50

$168

-$57.50

$31

-$17

-$71

December

$468.50

$416

$323.50

$210

$141

-$51

$46

-$10

-$71

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

Table 1: Matrix of Calf Breed Categories A-D Dam Breed

Dairy Sire Breed Calf Sex

Friesian

Kiwi

Jersey

Beef Sire Breed

Jersey

Kiwi

Friesian

NoG

AvG

G+

Male

C

B

A

B

B

A

Female

D

C

B

B

B

A

Male

D

C

B

B

B

A

Female

D

C

C

C

C

B

Male

D

C

C

C

C

B

Female

D

D

D

D

C

C

males, used across remaining cows. The Dairy Beef Index for beef sires would not only include the value for beef finishing but also the value for calving ease and gestation length for the dairy farmer.

DNA testing of progeny would determine parentage giving dairy farmers confidence in identifying sires and getting around issues of calves’ markings, he says.

That confidence would also transfer to the beef finisher who would know the calves would perform despite their colour markings. Buyers need to move away from only looking for those perfectly marked calves and discounting or not buying

others. That’s not objective enough and rearers end up missing out on animals that could give them rapid growth rates and dairy farmers are out of pocket and have wasted their efforts, he says.

“The fact is to get away from bobbies we’re going to have to find homes for 2.1 million calves.

“We’re going to need 550,000ha to stand them on if we take them through one winter – which is a system we’ve got to start considering.

“If we don’t and dairy farmers have to carry calves and rear them themselves we’re looking at dropping one million

Legend A = High value calf for rearing to finish B = Medium value calf for rearing to finish C= Low value calf for rearing to finish D = Little or no calf value NoG = Beef Sire with unknown genetics AvG = Beef Sire with average genetics G+ = Beef Sire proven with above average genetics and probably AI

dairy cows to accommodate them.”

The system requires a pan-farming sector approach, linking dairy farmers, rearers, finishers and meat companies right through to consumers.

The technologies exist now to streamline and set up systems to enable what some may call a revolutionary shift.

While it’s the dairy sector’s risk, with the right thinking and actions it could also be an opportunity for both the dairy and beef sectors and New Zealand as a whole given there are also opportunities to reduce biogenic greenhouse gas (GHG) emissions.

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

Cow value: is the dream run over?

SPECIAL REPORT

A shrinking dairy herd and the end of live cattle exports is likely to bring and end to record dairy cow values. By Elaine Fisher.

FEWER NEW DAIRY FARM conversions and the ban on live exports, which comes into force in April next year, are predicted to result in a drop in dairy cow values.

Greg Collins, founder of Progressive Livestock of Timaru, says despite the fact that current prices are up, his gut feeling is that values could drop by $200 to $300 a head.

“Cow prices are now as high as they have been in the last five to six years,” he says.

“In the past two years dairy cow prices have been not far away from record prices. The selling season to the end of June this year saw an increase from last year in cow prices of $100 to $200. In-calf heifers increased by $100, and the yearling value increased by $50.

This was on the back of increases the year before.”

Greg doesn’t see those prices holding.

“Supply and demand are a stronger factor than milk price in influencing cow prices. In the Dairy Exporter | www.nzfarmlife.co.nz | August 2022

‘New Zealand is one of the few countries in the world where banks will take animals as security for a loan, which is one of the reasons the sharemilking pathway to farm ownership works so well here.’

past three to four years between 120,000 and 150,000 dairy heifers have been sent offshore each year, but once that stops it will have a big impact on demand for cows so prices will drop.

“There has also been a big slowdown in dairy conversions in the past two years. At the peak of conversions, cows were selling for around $2500 each. Now overall, the dairy herd is shrinking in numbers.”

Despite his predictions of a drop in the value of dairy cows, Greg remains optimistic about the future of the dairy industry and in pathways to farm ownership for sharemilkers.

“For farmers who take the long-term view, there are still pathways to ownership, and I thoroughly endorse the dairy industry as a great one to invest in. However, the brutal facts are that challenges are looming.”

Farm systems specialist for DairyNZ Paul Bird agrees the future is not all gloom and doom.

His advice to sharemilkers feeling nervous about the possible drop in cow values and how 55

Coral Phillips, chartered accountant and director of long-established Waikato rural accounting firm CooperAitken.

that may impact on their equity, is to take the long-term view.

“No doubt if someone is just starting out and only has, say, a three-year timeline to sell a herd, then the risks of selling for less than the purchase price go way up. Like the share market, it’s too hard to predict what will happen in the short term. However, for those who are looking at a 10-year horizon, volatility is less important.”

A longer timeframe also brings the chance to improve herd performance and production.

“There is the opportunity to improve breeding worth which will be reflected in the value of cows.”

The dairy industry is a good business to be in, he says.

“In the last few years, the return on assets for 50/50 sharemilkers has been around 10%. The figures jump around a bit but overall are well above a 10% return which is a good business to be in with the numbers to back it up.

“The 10-year average for 50/50 sharemilker return on assets was 11.8%. Most seasons the return has been above 10% with only one year producing a negative return of -6.5% return.

The last two seasons the return has been between 18% and 19%.”

Paul says banks understand the volatility and generally take a conservative position when lending on livestock.

“New Zealand is one of the few countries in the world where banks will take animals as security for a loan, which is one of the reasons

the sharemilking pathway to farm ownership works so well here.”

Decisions around farm ownership can come with sacrifices, including buying a smaller, more isolated property on marginal land as a step towards the ultimate dairy farm. Equity partnerships are another option, he says.

Despite its volatility and some uncertainty around future trends, Paul says excellent opportunities exist within dairying right now.

Coral Phillips, a former dairy farmer and now chartered accountant and director of long-established Waikato rural accounting firm CooperAitken, says the traditional pathway to farm ownership, for 50/50 sharemilkers relying on herd equity, is getting harder.

“At CooperAitken, we have been tracking stock prices with payout since the 1980s, using the Herd Scheme values and Fonterra payout.

In the past, stock prices followed the payout, but this has changed in the last few years.

“Demand for stock has decreased as stocking rates are decreasing due to environmental and regulatory pressures. In the past, South Island dairy conversions and the China live export trade pushed up prices, but that influence has gone now.”

If cow prices drop, it could make it easier for sharemilkers to buy more cows. However, Coral says the traditional method of selling off cows to raise the deposit for a farm is no longer easy to achieve because land prices have increased so much more in comparison to stock values.

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“Some sharemilkers still do it, but it is pretty hard. They have to be totally focused, absolutely driven to every last cent and prepared to sacrifice a lot to get there. Now they are needing to find alternate means of getting the equity the banks require.

“Occasionally an existing owner is prepared to sell to their existing sharemilker, and will give a leg up to do it. This could be in the form of vendor finance.”

Equity partnerships are another pathway to ownership, which Coral says appears to be increasing in popularity due to the ability to build more equity. “Not only will they own the cows, but they have an opportunity to buy into the farm operation on a percentage basis.”

But Coral says these need to be entered into carefully, as they can be fraught with problems. “Traditionally people go farming because they want to do their own thing and be autonomous in their decision-making.

An equity partnership requires a different mindset.

“Due diligence is vital, and the partners need to be aligned in their goals. There needs to be regular management reporting and good communication. If all goes wrong, exiting can be quite difficult if this hasn’t been well thought out and legally documented in the beginning.”

Selling cows to buy urban real estate is another method some farmers use to increase equity towards farm ownership Coral says.

However, the cost of the Brightline tax needs to be taken into account.

Whatever aspect of the dairy industry people are involved in, from contract milking to sharemilking to farm ownership, Coral says surrounding themselves with trusted professionals, including rural accountants, is important.

“At CooperAitken, we are a large rural firm with a lot of farming clients at all levels and we are constantly communicating with banks and lawyers, so we know what banks are thinking and use that knowledge to help our clients.

“We believe in working as a team with our clients. I prefer not to be an accountant who just does the annual accounts at the end of the year.

“It is much better if we work with clients through the year, including budgeting, doing the GST and regular reporting which keeps everything up to date. That way we have an open communication channel and clients are more likely to bounce ideas off us. This makes it easier for us to help, and if necessary, bring in other advisors to assist.”

Coral says every farming situation is different.

Those sharemilkers who have family support behind them, such as the ability to act as guarantors or a succession plan to ownership of the family farm, the situation is easier than for those going it alone.

“The trick is to think outside the square and be open to alternate ways to build the required equity.”

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57

SPECIAL REPORT

Surplus calf values set to crash The upcoming ban on live cattle exports is set to make life hard for calf rearers. Story by Karen Trebilcock.

THE VALUE OF SURPLUS FRIESIAN heifer calves will crash when live exports to China end early next year, managing director of Waikato-based live export company Genetic Development said.

“They’re making a big premium over the local market – 50 to 100% more.”

Demand was strong for the animals but the cut-off date of April 30, 2023, would make it hard for rearers.

“Spring 2022-born calves will have to have a top rearing programme to reach the required export weights by then.”

Chinese importers were frustrated by the impending ban and they saw it as a breach of the two countries’ Free Trade Agreement.

“The New Zealand industry supplies breeding stock by sea to China to very high standards with top results so to replace this trade will be difficult.

“There is a shortage of cattle in Australia and although Uruguay and Chile can supply some dairy stock, the sea voyage is twice as long from these countries so the risks for the animals increases.”

Despite the Government’s signalling of a transition period “to wind down the trade” following its announcement of the ban last year, shipments of live cattle from NZ to China have since increased.

Ministry for Primary Industries (MPI) figures show in 2021, 134,722 cattle, worth about $500 million, were exported 58

Cattle loading for export.

either from Napier, New Plymouth or Timaru ports to China compared with 109,921 the year before.

That year included the temporary suspension of shipments after the loss of Gulf Livestock 1 in a cyclone in the East China Sea with the loss of 43 crew and 5867 cattle.

For the five years before then, 2015 to 2019, the highest number of cattle in any year was 40,221 which was in 2016.

Destinations then also included the Philippines, Mexico and Vietnam as well as China.

Voyages have taken between 14 and 22 days. Deaths have decreased on shipments with this year the figure at 0.04% of all cattle exported, compared with last year’s 0.07% and 2020’s 0.12%.

Some shipments in the past three years have recorded no deaths.

Until the end of July this year, 61,658 cattle have left for China in 10 different shipments with more likely, a MPI spokesperson said. Southern Australian International Livestock Services (SAILS) managing director Andy Ingle said China’s need for cattle would continue.

“It will be replaced by other exporting countries including Australia and some South American countries currently exporting and possibly new countries for supply will be opened by China to ensure their requirements are able to continue to be met,” he said.

The live animal export business exports from Australia, NZ, Uruguay, United Statesand Chile to markets including China, Russia and other CIS countries, Mexico, Japan, Turkey and Israel.

“The demand certainly looks to remain strong from China moving forward for the medium term in our view.”

Although NZ and Australia were leaders in animal welfare standards for livestock exports, South American countries currently supplying China did not adhere to the same codes.

“Therefore, it really comes back to the individual exporting companies operating from those markets and their own internal quality control standards in particular with regards to vessel transportation.”

LIC chief executive David Chin said the company was not prepared to fill the gap caused by the ban of live cattle exports.

“We don’t have a distributor in China and we don’t have any plans to export our genetics there.”

LIC’s dairy genetics were not in demand there due to the country’s import regulations and their different farming systems. “Our international business is focused on markets that are more suited to our pasture-based genetics and which will deliver a good return back to our farmer shareholders in New Zealand, such as South America and Europe.”

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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59

ENVIRONMENT BALLANCE AWARDS

W WINTERING

better

A change of systems to wintering barns has proved a winner in Southland. Words and photos

by Karen Trebilcock.

60

ith the spotlight on wintering, especially in the south, it was timely a dairy wintering operation was the regional supreme winner in the Southland Ballance Farm Environmental Awards this year.

Kevin Hall’s Hollyvale Farm, in Waimahaka, winters his 670 mixed-age cows under cover and further 255 R2s and 245 R1s plus about 80 beefies on grass and balage.

“It was very special to win,” Kevin said, “and a real thrill to see what we’re doing recognised.

“After years of wintering on crop, we knew something had to be done to winter better. We knew change was inevitable so we thought it was better to go ahead and do it and then we would feel a lot more comfortable.”

When he bought the farm in 2008, the 400 hectares were running sheep and beef. He sold 150ha that was on the other side of the road and built two wintering barns.

“There were one or two Redpath sheds around then, but we were on our own designing a wintering and effluent system that worked for us.”

With two nearby dairy farms of cows and young stock to winter, the decision was made to build barns. Two were built the first year and three years later he built the third, making refinements along the way.

“It took a bit of capital, but the wintering barns mean we have a guaranteed cow condition in the spring, regardless of the winter weather, which flows into the rest of the season meaning better cow health and better milk production.”

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

As well, the farm’s soils are not damaged and the nutrients from the barns are stored in a clay-lined two million litre effluent pond ready to be spread on silage paddocks in December.

“It’s not just the barns you’re building, but the effluent ponds and the silage bunker so it’s a whole system.

“The barns were the easy bit, it was the effluent system to collect the nutrients that pushed us. We’ve done a weeping wall with the third barn and that’s worked a lot better.

“We’re trying not to lose anything. Everything we collect from the barns during the winter goes out during the summer on the grass. Our soil tests show we still have to put on phosphate and sulphur on the pasture but that’s it.”

The cows are kept content on a woodchip bedding which is spread on paddocks again when the weather is kinder, again returning nutrients from the winter to pastures.

The woodchips drain into the effluent system and the concrete area where the cows stand on the edges of the barns to eat the silage is scraped once a day with a tractor.

“I’ve seen some barns where the concrete the cows stand on to eat the feed is not covered but then the rain gets on it. It means even more effluent so I think we made the right choice covering it.”

Instead, the rainwater is collected from the roof and fed into tanks for drinking water for the cows.

The first two barns are three bays of 7.5 metres but the third barn he decided to make wider and is three 9m bays. There are no stalls so animals are free to socialise. And with no sides, except for some wind cloth, the plastic starts at 3m so there is plenty of ventilation.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

The 60ha of native bush was one of the first in the country to be placed in the QEII National Trust.

“We’ve had snow on them and they were fine. The first two barns we’ve replaced the plastic because we had to replace the strop system which it’s attached to. The third barn, which is 10 years old now, the plastic on it is still fine.”

The cows were always happy to go in the barns at the end of May but were keen to stretch their legs when they left about July 20 to be trucked back to the two farms in time for calving.

The R3s are kept separately in the barns, the most at risk age group on the farm, so they get preferential feeding and with the silage tested, Kevin knows exactly how much his cows are getting.

“Through June, the mixed age cows are getting 11kg drymatter

61

The afternoon ration of silage is fed from the wagon.

(DM) per day which is 105 MJ ME, and allowing for some wastage, with that we’re hoping to put on half a condition score.

“We’ve got scales in the feed wagon and they get three loads in the morning and one load in the afternoon. As well there’s a bale of barley straw in the barns all the time.

Out on the paddocks, the R2s and R1s are moved daily on autumn-saved 3000 DM/ha covers with balage made from either grass, oats or barley.

The R2s have 7.5 sq m allocated each a day with the aim to reduce mud so a crop can be sown as soon as possible behind them.

It’s a two-year rotation for the paddocks with the young stock eating autumn saved grass then barley is planted under sown with an annual rye grass. The barley is harvested as wholecrop in the summer.

The follow year oats go in which is baled around Christmas and the paddock returned to permanent pasture.

The oats are planted in early September, if ground conditions are good enough although some years it’s not until mid-October.

“It gets challenging. By mid-October it’s almost too late to capture the nutrients from the wintering stock and then we have to apply 150kg/ha of DAP to get it growing.

“The September-sown oats don’t need any fert at sowing.”

The R2s are back fenced and portable water troughs are used, although they’re problematic to de-ice in a frost.

The 60ha of the farm in QEII National Trust provide plenty of shelter.

The predominantly matai bush was placed in one of the country’s first QEII National Trust covenants by then owner Bill Holms in 1982.

About four years ago regional council Environment Southland extensively trapped possums throughout it and now return every year for monitoring. Kevin has filled in gaps with natives of his own.

He’s also planted 5ha of radiata pines on the steeper, south-facing slopes on the farm hoping for an alternative income stream.

“I was a recent climate change ambassador and I gained a lot of knowledge about greenhouse gases.

“We have about 80 beef cattle on the farm and the trees could replace them in the future on the balance sheet. We’ll just see how it goes.”

Growing up on a town supply farm on the outskirts of Invercargill, he’s the only one of his three siblings who has gone farming. His own three children have chosen different paths as well.

“You have got to be passionate about farming, or you’d get sick of it pretty quickly. You’ve got to have farming in your DNA to enjoy it.”

‘IT TOOK A BIT OF CAPITAL, BUT THE WINTERING BARNS MEAN WE HAVE A GUARANTEED COW CONDITION IN THE SPRING, REGARDLESS OF THE WINTER WEATHER, WHICH FLOWS INTO THE REST OF THE SEASON MEANING BETTER COW HEALTH AND BETTER MILK PRODUCTION.’

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

ENVIRONMENT WINTERING

Wintering WELL SETS UP CALVING Words by: Justin Kitto

K

eeping up good winter grazing standards can help reduce stress for both animals and people onfarm, as many head into the midst of calving.

Greg Mitchell farms in Hawke’s Bay and winters 1600 cows on his 520 hectare dairy farm. At this time of year Greg and his team are focused on ensuring they check the weather forecast, paddock and cow condition daily.

“Our team check the cows every day to make sure they are in good condition, and are eating well,” he says.

Daily checks help identify any issues so they can be managed and corrected before calving. In bad weather, the team can shift stock off crops to sheltered paddocks. Greg

has also identified which paddocks have good shelter and are best for calving.

While winter has so far been mild, a wet autumn has meant grazing needs to be managed carefully to avoid mud becoming a problem.

To reduce trampling, the team stand cows off crops after feeding for a couple of hours and keep mob sizes small. Steeper paddocks aren’t used for winter cropping, and they graze any sloped paddocks from the top downwards to reduce mud.

The cows graze on fodder beet, oats and grass. Greg and his team have planted oats as a catch crop after wintering to help utilise any available nitrogen for plant growth. Winter grazing hasn’t been a focus for some North Island farmers in previous years, but new wintering regulations will apply to all farmers across New Zealand in

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2023. All farms need to have a wintering plan and will need to plan ahead to assess whether they will need to apply for a consent. Greg says the first step to setting yourself up for winter is to start planning your approach well ahead of time.

“Go and look around your farm to figure out which paddocks would be best for winter crops and for calving on. Every farm is different but you can often find practical solutions which work well for your team and your animals.”

Greg is already choosing his winter cropping paddocks for next winter and has started soil testing to assess nutrient levels in different paddocks.

• Wintering resources: dairynz.co.nz/wintering • Justin Kitto is DairyNZ solutions and development lead adviser (wintering).

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63

STOCK VET VOICE

PRIORITISING

colostrum

MANAGEMENT Words by: Lisa Whitfield

Lisa Whitfield

Superior quality colostrum measured using a Brix refractometer

Good quality colostrum measured with a Brix refractometer

Poor quality colostrum measured with a Brix refractometer

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A

s many of you know, the first feed a calf gets after it is born is one of the most important meals of its life.

Calves are born with very little in the way of an immune system, and so rely on the transfer and absorption of antibodies from their dam through the first milk. This process reduces the susceptibility of the calf to diseases such as calf scours and navel ill, while its own immune system develops over the first few months of life.

Two important factors determine whether the transfer of antibodies from the dam to the calf are successful.

1. The calf needs to take in a sufficient volume of gold colostrum within six to 12 hours of birth.

2. The quality of gold colostrum needs to be good – i.e containing a high level of antibodies.

Most people realise the importance of the timeframe between when a calf is born and when it needs to have received its first feed of gold colostrum - in a nutshell, calves absorb antibodies from colostrum through their gut wall, and the ability to do this declines from birth, until it can no longer be absorbed at 24 hours old. There is a sharp drop off in how well antibodies can be absorbed at around six to eight hours after birth.

What many don’t realise however, is that from the moment a cow begins to actively calve, her colostrum quality begins to decrease – think about the impact of this in your calving and calf rearing system – is the colostrum your calves receive good quality?

When we take calves away from their dams, we need to ensure we are not compromising calf health by feeding them poor quality colostrum.

Measuring colostrum quality is an incredibly simple test – and it allows us to direct the absolute highest quality colostrum to the youngest calves.

A Brix refractometer is an essential piece of equipment for the dairy shed, and its use is the place where a calving system and calf rearing system need to meet and work together.

Measuring the Brix level of gold colostrum gives

Newborn calves feeding.

us an indirect measure of antibody concentration in colostrum. In order to test colostrum quality, all you need to do is take a squirt of colostrum from a fresh cow, place a drop of it on the face of the refractometer, close the flap, and read the scale. It’s an instant result and it takes only seconds per cow to perform.

If the reading measures above 25% it is superior quality, above 21% it is good quality, and below 21% is poor quality. The highest reading we have had from a fresh cow was 33%.

You might wonder what the numbers mean - it roughly reads like this: • A calf needs to receive 125g of antibody within six hours of birth in order to absorb enough antibody into its body • A Brix reading of 22% correlates to ~50g/L of antibody • This means a calf needs to drink ~2.5L of gold colostrum with a Brix reading of 22% in the first six hours of life in order to achieve the transfer of good immunity.

A lot of rearing systems rely on pooling colostrum to feed to the calves – but if you add in a Brix test, you can then pool colostrum strategically – pool the top quality colostrum together, and pool the low quality colostrum separately.

We use a system of coloured buckets to Dairy Exporter | www.nzfarmlife.co.nz | August 2022

WHAT MANY DON’T REALISE HOWEVER, IS THAT FROM THE MOMENT A COW BEGINS TO ACTIVELY CALVE, HER COLOSTRUM QUALITY BEGINS TO DECREASE. keep our colostrum pooling system simple. Each fresh cow is milked into a test bucket and her colostrum is tested before we pool it. Colostrum measuring over 25% goes into orange buckets, colostrum measuring over 21% goes into white buckets, and low quality colostrum goes into green buckets. This way, no matter who is doing the calf rearing, they know which bucket to reach for to feed the newborn calves. If there is a shortage of top quality colostrum, then we will prioritise the best quality available to heifer replacements. The reality is that you can’t spend all day

bringing in freshly calved cows and milking them, and many calves will receive their first feed of gold colostrum by suckling their dam.

However, if we are taking a newborn calf away from its dam before its first feed, it is critical that we don’t compromise the health of the calf by doing a poor job of providing it with passive immunity.

A Brix test is a simple, cow-side test which can allow you to step up your game when it comes to rearing healthy, well prepared calves.

• Lisa Whitfield is a Manawatu production animal veterinarian.

A Brix refractometer – this one only cost $59 – a cheap investment in calf health.

Coloured buckets used to pool colostrum so we can keep track of the highest quality gold colostrum.

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65

STOCK CALF REARING

THE IMPORTANCE OF colostrum Colostrum is the essential ingredient for newborn calves to survive and thrive, Paul Muir writes.

F

ailure of calves to get sufficient colostrum and acquire early immunity is a worldwide problem.

New Zealand studies have shown 25% of one-dayold calves have had no colostrum and up to 40% have not consumed enough colostrum.

It is critical that a calf gets high-quality colostrum within the first 24 hours and, preferably, within the first 12 hours.

Calves with inadequate immunity from colostrum are four times more likely to die and those that survive have lower weight gains, poorer feed conversion efficiency and a higher incidence of scouring than calves with good levels of immunity gained by drinking good quality colostrum in their first 24 hours.

Calves are born with a very immature immune system and immunity is obtained from the cow through immunoglobulins in her colostrum. These immunoglobulins are large protein molecules which can only be absorbed and move through the calf’s intestinal wall for the first 24 hours after birth.

By this point the wall of the small intestine has matured to the point that these large immunoglobulins can no longer pass through. In addition, the secretion of digestive enzymes starts 12 hours after birth, these enzymes digest and break down immunoglobulins rendering them useless.

The young calf is born with no resistance to diseases like E. coli and salmonella, so it’s only protection in these first few days is from colostrum (this is called passive immunity).

A calf with no immunity can get sick when challenged with just 500 salmonella bacteria, whereas one that has received a good level of passive immunity can withstand 10 billion salmonella bacteria.

By the end of the first week the calf is starting to build its own immune system and produce its own antibodies in response to pathogen challenges. Within a few weeks the calf is well on its way to being able to fight off disease.

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Why do calves miss out on colostrum from their mothers?

While many calves get colostrum from their mothers, a lot don’t. The practice of removing calves from dairy cows for generations has undoubtedly reduced the cow’s mothering instinct. Some dairy cows are apt to wander off soon after calving. Calves can go under hot wires and selection for milk production means that some udders are low and difficult for calves to access.

Six hours after birth, around 25-30% of dairy calves will not have suckled and 20% still will not have not suckled within 18 hours. Daily calf collection (if not twice daily collection) is the right thing to do – however, do not assume that the calf has had enough colostrum from its mother before you pick them up. New arrivals to the calf shed need to be fed colostrum unless you are sure they have had colostrum from their mother.

Waiting until the next day when they will be “hungry” is too late. If necessary, the calf should be tube fed although this reduces the efficiency of absorption of the antibodies.

The amount of protection a calf obtains from colostrum is determined by the amount of antibodies ingested and the amount that is absorbed. The amount ingested is affected by the volume of colostrum consumed and the concentration of the antibodies in the colostrum. The calf should get 5-6% of its bodyweight as colostrum in the first six hours and the same amount 12 hours after birth to ensure that at least 100g of antibodies are consumed. This equates to about 2 litres of colostrum per feed for a 40kg calf.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

THE YO U CALF IS NG BORN WITH N RESISTA O NCE TO DISEAS ES LIKE E. COLI AND SALMO NELLA, SO IT’S ON PROTEC LY TION IN THES E FIRST F EW DAYS IS FR COLOST OM RUM.

Graph 1. Development of passive and active immunity in the calf

Antibody concentration

Passive immunity (Colostrum)

Active immunity (Immune system)

High risk period

1d

Time

14d

Factors affecting the quality of colostrum Antibody levels are highest in the first milk produced after calving and then drop rapidly so colostrum fed to calves in the first 24 hours should be first milking colostrum only (see graph 1).

Antibody concentration varies between cows with a DairyNZ study showing an average of 48g/litre but with a range from 20 to 100g/l. Ideally, a calf should be fed first milking colostrum from a mixed age range of cows — to give the

calf a wider range of antibodies. Cows which have been vaccinated (e.g. against rotavirus) will produce more antibodies to the pathogen they have been vaccinated against. Cow breed, age, her exposure to pathogens and nutrition all affect the quality and volume of antibodies.

Feeding energy-deficient diets prior to calving reduces both production and quality of colostrum. Generally, dairy breeds produce more total

immunoglobulins than beef breeds and older cows produce more immunoglobulins than heifers as they have been exposed to more diseases.

In another study, we bled calves on arrival from 9 dairy farms to look at colostrum status. GGT less than 50 indicated no colostrum and GGT levels between 50 and 200 indicated marginal colostrum. About 22% of calves had nil to

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Table 1: Colostrum status of calves sourced from 9 dairy farms GGT range <50

50-199

200-499

200-499

Average GGT (U/I)

28.1

121.9

353.8

1099.0

% of calves

10.2

11.9

26.0

51.9

13

11.1

4.3

3.6

% to sick pen

14.8

9.5

5.8

6.5

% scouring

51.9

41.3

39.9

40.4

Age sick (days)

9.5

7.9

12.6

13.8

% deaths

marginal colostrum. Death rates were higher in the no colostrum group (13%) and the “inadequate colostrum group (11.1%) than in the “good” colostrum groups (4%). (see table 1).

There was variation between source farms in apparent colostrum intake, with a range in mean GGT (colostrum) levels of 360 up to 942 U/l. Calf mortality ranged from 1.2% up to 12%.

The farms with the lowest colostrum intake had the most calves in the sick pen and the highest mortality.

When we looked at colostrum level by arrival batch, it was clear colostrum level was declined as the season progressed. Calf rearers often experience having more sick calves as the season progresses.

This has generally been put down to a build-up of bugs through the season as the shed gets dirtier and the weather warms. Yet here is evidence that declines in calf colostrum status may increase the risk of calves getting sick. Presumably, this is due to a decline in standards on the dairy farm as the season progresses.

Sick calves Most problems occur in very young calves and by the time calves are two to three weeks old and eating pellets the incidence of problems drops dramatically. An early indicator of a problem is often scouring. There are three possible causes – stress, nutritional (both management issues) and infectious agents. There may be more than one causative agent and identification of the actual cause is often difficult. The number and timing of calves scouring is often a clue as to the cause.

• More than 40% calves scouring: Often an indication of a problem with the milk. May not be curding, the concentration may have been mixed wrongly or too much is being fed.

• Between 5% and 40% calves scouring: Often an indication of cryptosporidia infection. This is caused by a protozoa which is widespread in calf sheds. It particularly affects young calves up to 10 days of age. The infection builds over a few days and can affect a significant proportion of calves in the shed. The treatment is to remove from milk and feed electrolytes for a day.

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• Less than 5% calves scouring: A few scouring individuals is often the sign of something more sinister – particularly if they go down very quickly. Consult your veterinarian. Potential culprits are rotavirus and salmonella. Isolate and treat with electrolytes. Salmonella is caused by a bacterium and can be treated with antibiotics. If a recurring problem on the property then young calves can be vaccinated. Often rotavirus and salmonella are secondary to a cryptosporidia infection which makes treatment more difficult.

Stress scours. Can be caused by difficult birth, bad or sudden change in weather, transport, environment (e.g. over-crowding, cold, damp, draughty or humid conditions inside calf sheds).

Even changes in staff and hygiene can increase the likelihood of scours. The stress of transporting calves from the sale yards or from one farm to another may be sufficient to cause scours if calves are offered milk on arrival. Newly arrived calves should be fed an electrolyte.

Nutritional scours. Often caused by overfeeding or by a rapid change from colostrum/milk regime to a milk powder regime. The initial digestion of milk occurs in the abomasum (or fourth stomach) and then in the intestines. Nutritional scours is due to inadequate milk digestion in the abomasum. This means the milk leaves the abomasum too early and overloads the intestine with lactose. This results in a watery scour and the fluid loss results in a very dehydrated calf.

Infectious scours. Caused by a range of pathogens including cryptosporidia, coccidia, salmonella, E coli and rotavirus. But generally, the better the immunity obtained from colostrum, the better the calf copes with disease challenges. In a calf that has had inadequate colostrum as few as 500 salmonella bacteria can result in a sick calf while a similar calf with an adequate colostrum intake can cope with as many as 10 billion bacteria before it gets sick to the same degree.

• For more information www.on-farmresearch.co.nz or facebook – NZ Calf Rearing Discussion • Paul Muir and fellow researchers from On-Farm Research, Poukawa, Hawke’s Bay have been researching the calf rearing market and strategies since 1996.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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STOCK ROTAVIRUS

Rotavirus: A CALF-KILLER Rotavirus is a major hazard for calf rearers and their charges, Paul Muir writes.

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F

rom our calf rearer surveys, we know rotavirus is the biggest animal health issue facing calf rearers with some reporting death rates as high as 30%. We also battled with rotavirus twice and it doubled our calf mortality - from less than 3% to 6.7% and 5.4% in the two years when we had rotavirus outbreaks.

Rotavirus is devastating and demoralising – for both calves and rearers. Since it is a virus, antibiotics are ineffective. Treatment with large volumes of electrolytes is labourintensive and time-consuming, and not always effective. Even if the animals do recover, they will still shed large numbers of virus particles into the environment, potentially infecting healthy calves.

Recovered calves grow slower and are more susceptible to other diseases, and calves can become reinfected. It is persistent in the environment, and can remain infectious for many months at room temperature. It can withstand low temperatures and high humidity on non-porous surfaces like plastic and concrete.

What is it and how does it kill calves?

Rotavirus infects and destroys mature cells on the tip of the ‘villi’. Villi are the tiny, finger-like projections on the surface of the small intestine that help absorb nutrients from the digestive tract.

Damage to these cells not only reduces absorption of nutrients

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

ating and demoralising – for both calves and rearers. Since it is a virus, ective. Treatment with large volumes of electrolytes is labour-intensive g, and not always effective. Even if the animals do recover, they will still s of virus particles into the environment, potentially infecting healthy

row slower and are more susceptible to other diseases, and calves can It is persistent in the environment, and can remain infectious for many mperature. It can withstand low temperatures and high humidity on s like plastic and concrete.

milk and electrolytes, but results • Hanging back from the feeder/ w does it killfrom calves? in fluid loss from the intestine, further reluctance to come in and feed d destroys mature cells on the tip of the ‘villi’. Villi are the tiny, finger-like compounding the level of dehydration.

• Reluctance to drink, fussing with teat, surface of the This small intestine that help absorb nutrientscoming from off theteat dehydration kills calves. Rotavirus mage to these increases cells notthe only reduces absorption from and concentration of calcium of nutrients • Wet tail, palemilk yellow scour – can sults in fluid loss from the intestine, further compounding the level of in the intestinal cells which acts like a sometimes be watery/and bloody ehydration killstoxin calves.

Rotavirus the concentration of calcium and results in the increases pale yellow scour Most calves that die of rotavirus, die associated with rotavirus. from loss of water and electrolytes, rather s which acts like a toxin and results in the pale yellow scour associated

How is it spread and what are the signs?

Rotavirus affects calves up to three weeks of age and is spread primarily by calves ingesting faecal matter containing virus particles, but it can also be inhaled, particularly if the shed is highly contaminated.

Infected animals shed large quantities of the virus into the surrounding environment, contaminating the shed area and increasing the risk of other animals being infected. The rate of spread depends on the level of environmental challenge the calf is exposed to but typically between 24-48 hours after infection.

The most obvious sign of Rotavirus in calves is a pale yellow scour, often rancid smelling, this leads to rapid fluid and electrolyte loss and, therefore, dehydration. Rotavirus initially needs to be confirmed with a lab diagnosis but rearers who have already experienced it are likely to identify the presence of rotavirus very quickly.

The key is to identify infected calves very fast, isolate at the start and treat promptly with electrolytes. Make sure you have good hygiene to reduce the rate of spread. At every feed it is important to cast an eye over each calf to identify any potential signs of illness. These may include:

than the direct action of rotavirus. Rapid treatment with electrolytes is critical.

Scouring continues until the villi inside the small intestine are again covered with mature cells that allow the resumption of normal digestive-absorptive processes.

Don’t stop feeding milk but don’t mix electrolytes and milk at a single feed.

It is important to keep the calf’s energy levels up, as well as continuing to provide the calf with antibodies with which to fight the virus.

Many electrolytes contain sodium bicarbonate that alter the pH in the digestive tract and adversely affect milk absorption, so milk and electrolytes should be fed at least two hours apart.

Animals may continue to shed the virus in their faeces while not showing clinical signs. Calves do not become “immune to rotavirus” and they can get re-infected.

However, the second infection is usually a lot less severe.

Electrolytes provide energy but no protein and removing milk for any length of time reduces the ability of the calf to fight infection. If milk is withheld for longer than two days the epithelial cells in the gut become dysfunctional and when milk is introduced, the milk itself can cause scouring as it cannot be digested.

Scouring calves can lose up to five litres of fluid each day including mineral salts essential for normal body function which is why it is usually the dehydration and acidosis that kills the calf.

Recommendations are to feed milk and electrolytes separately - with at least two hours between the two. If the electrolytes and milk are mixed or fed too close together the milk will not curd and this will increase the level of scouring.

Therefore, the electrolytes needed to be administered as extra feeds. This also means that the calf is getting fluids on a more regular basis maximising the potential absorption of the poorly functioning gut.

While electrolytes can be tube fed, it is much better if the calf will drink the milk so that the milk bypasses the rumen via the oesophageal groove.

ROTAVIRUS AFFECTS CALVES UP TO THREE WEEKS OF AGE AND IS SPREAD PRIMARILY BY CALVES INGESTING FAECAL MATTER CONTAINING VIRUS AIT CAN ALSO BE INHALED.

Treatment of scouring Feeding of electrolytes to scouring calves is labour intensive but it is critical to maintain fluid levels. Calves which are scouring and dehydrated need to have the lost fluid from scouring replaced as well as their normal fluid intake. If a 40kg calf has lost 10% of fluid it will need 4 litres just to replace the water it has lost.

While the recommendation to stop milk feeding for 24 to 48 hours remains true for nutritional scours, the recommendations for infectious scours has changed in recent years. Now the belief is that it is important to keep feeding at least some milk to calves especially if they will still drink.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

How do we prevent it?

There is no silver bullet although vaccinating cows against rotavirus and then feeding calves with colostrum and milk from these cows in the first 24 hours helps. This provides the calf with some passive immunity against rotavirus.

Unfortunately, the passive immunity declines in the days after birth and there is a risk period before the calves’ own immune system is functioning properly and often the peak incidence of rotavirus infection during this period between five and 14 days of age. Nevertheless, the more rotavirus antibodies a calf gets from colostrum and the older it is before it is challenged by rotavirus, the more likely it is to survive.

Antibodies in colostrum/milk can

71

continue to provide limited local middle of a rotavirus outbreak). If calves immunity in the gut (even though they are coming from a number of sources, pen can’t be absorbed through the calf’s gut) calves from the same farms together and so feeding milk from vaccinated cows group calves according to age. will also help prevent the development of rotavirus.

Our experience Hygiene reduces the environmental Our own experience with rotavirus started contamination. Your shed needs to be on August 13 when we had 435 calves in thoroughly cleaned out at the end of the shed. They ranged in age from new each season and sprayed with a virucide arrivals up to calves which had been in the solution. Since the whole idea is to keep shed for 21 days. the amount of virus contamination Within three days of the first case to a minimum, spray your shed every rotavirus being diagnosed, it had spread three-four days with a virucide solution through the shed, with some calves in each throughout the risk period (i.e. until the pen affected. Younger calves were hit the youngest calves are two weeks of age). hardest but even the oldest calves were Many solutions are suitable for spraying affected. However, the older the calf the over calves. greater its chance of surviving and we had Maintain a high standard of cleanliness no deaths in the calves over two weeks of in the shed and thoroughly clean and age. In total, 46% of the calves we reared disinfect equipment such as feeders, were affected and at the peak it was all especially equipment used in the sick pen. hands to the pumps and we were treating A bucket of virucide can be kept handy to over 80 calves. The shed was obviously soak bottles and teats in so contaminated that when not in use. it was not practical Minimise equipment or worthwhile to For more information (including gumboots) isolate calves so we www.on-farmresearch.co.nz and movement between stopped trying and or facebook – NZ Calf Rearing pens with sick animals concentrated on Discussion and uninfected pens dealing with the especially at the start problem. of an outbreak- once the outbreak is in Most calves were on a once-a-day milk full flight the shed is contaminated so feeding system and we continued to feed less important. Initially, try to isolate milk in the mornings. Any calf that we sick calves away from healthy calves to had any reservations about got a blue neck avoid contamination- this also helps with band so that we knew to monitor it. managing the extra feeds of electrolytes.

Any calf that had a wet tail got a pink Keep a close eye on who is coming band and was fed electrolytes in the into the calf sheds and try to avoid evening. Where the majority of the pen contamination from other farms (apart had pink bands, it was just as easy to feed from people feeding the calves, minimise electrolytes to all the calves in those pens the number of visitors to your shed in the as chances are the other calves were going 72

to need it soon anyway. Any calf that was wobbly, wouldn’t feed or was down got a red band and was taken to the sick pen.

In total, 8% of calves were taken to the sick pen and 44% of the sick pen calves subsequently died. Overall, shed mortality was 5.4%. Calves in the sick pen were fed milk in the mornings and electrolytes at midday and evening (either by tube or bottle). As a general rule, calves in the sick pen need as much electrolytes as you have time to get into them.

Within 10 days, we had worked our way through the worst of the outbreak but any new calves which were brought into the shed went down within 48 hours in spite of regular spraying of the shed. We felt that we had a very high level of contamination within the shed which was even swamping the good healthy colostrum-fed calves. The only solution was to put new calves into a completely different shed. It is worth noting that we also had three outbreaks of salmonella in the shed. Yet this was quickly recognised as being different, the affected pens were treated with antibiotics and no calf died from salmonella.

Because we had rotavirus problems the previous year, we had sourced our calves from supposedly vaccinated herds. This probably made us over-confident. The pens were clean, calves were happy and we weren’t as diligent as we should have been with the early virucide spraying of the shed. This probably led to the buildup of contamination to the level where it became a major problem.

• Paul Muir and fellow researchers from On-Farm Research, Poukawa, Hawke’s Bay, have been researching the calf rearing market and strategies since 1996.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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Dairy Exporter | www.nzfarmlife.co.nz | August 2022

STOCK DAIRY BEEF

FINISHERS AND DAIRY FARMERS BENEFIT FROM

superior beef genetics

D

airy farmers are being encouraged to consider using genetically superior beef bulls across their herds this spring to help create greater value along the value chain.

This is based on a recent report summarising the findings of the Beef + Lamb New Zealand Genetics’ Dairy Beef Progeny Trial.

Written by farm consultant Bob Thomson, the report summarises the findings of a whole-farm modelling process, where the progeny of the highest ranked beef bulls from the Dairy Beef Progeny Trial (DBPT) were compared with the progeny of average bulls.

These showed a 15% growth advantage at 400 and 600-days compared to the average bulls. This would improve gross margin returns by between $172 and $211/ha and improve feed conversion efficiency by 10%. This in turn would reduce greenhouse gas emissions.

The modelling demonstrated that when the top 10-15% DBPT bulls for marbling

(intramuscular fat) were compared with the average DBPT bulls there was a 20% improvement. This correlated with an increase in the strike rate with beef quality supply programmes, although with a price premium of 30c/kg carcase weight, this only increased the gross margin by another $22/ha.

The modelling also compared one and two winter finishing policies and highlighted clear advantages and disadvantages to both. The ranking of DBPT bulls did not change between the two policies. Compared to the two-winter, the one-winter system occupied onethird less land area with 15% more feed conversion efficiencies.

The disadvantage was in lighter carcase weights (160-220kg CW) when processed between November and February. These weights were outside targeted beef grading and associated payment schedules.

Building a connection between dairy farmer and finisher The report noted a disconnect between

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

dairy farmers and beef finishers and the advantages for both parties to address this. Working with a dairy farmer who is investing in superior beef genetics gives the finisher the opportunity to benefit from significantly improved growth rates and carcase attributes.

The report states that this disconnect has come about because finishers tend to prefer to buy dairy-beef spring-born weaners in autumn rather than rear them over summer. In drought years, when this is most apparent, there is little difference in the price between autumn and spring calves.

Dairy farmers producing high quality calves often felt frustrated with variable and inconsistent demand from beef finishers irrespective of whether they are four to five-day old weaners or 100-kilogram weaners.

“Once the calves leave the dairy farm the connection back to their genetic merit is usually lost. This leaves the beef finisher to judge calves on their coat colour and condition,” Thomson says.

75

‘ONCE THE CALVES LEAVE THE DAIRY FARM THE CONNECTION BACK TO THEIR GENETIC MERIT IS USUALLY LOST. THIS LEAVES THE BEEF FINISHER TO JUDGE CALVES ON THEIR COAT COLOUR AND CONDITION.’

Bobby calf policies- a reason to change Dairy farmers will likely be faced with a no bobby calf kill policy within the next few years and will either have to produce calves that have value as a beef finishing animal or reduce cow numbers to accommodate the rearing of surplus calves.

“Either way, the value of the surplus calves can be raised significantly by dairy farmers utilising high genetic merit beef bulls over the dairy cows which are not required to generate their dairy replacements,” he says.

The high genetic merit beef bulls identified in the DBPT are proven performers and their genetics are only available in commercial quantities

through artificial insemination.

Analysis has shown that the actual cost of beef AI in dairy herds is slightly less than natural mating and generated many more advantages. These included shorter gestation length, proven easy calving and calves which will grow faster and to heavier weights for finishers.

There was also better biosecurity and work safety associated with AI.

Dairy beef progeny test The purpose of the DBPT, which began in 2015, was to identify high genetic merit beef bulls that would benefit both dairy and beef farmers. Over the course of the programme, detailed and comprehensive phenotypic data has and continues to be collected, analysed and reported for a range of traits including gestation length,

calving ease, growth rates, carcase weight and carcase quality.

The trial includes a number of beef breeds with around 20 new bulls being progeny tested every year. The most upto-date report showed the top five bulls ranked on carcase weight represented by five different breeds.

“These results highlight the fact that between breed analysis is important and no one breed dominates the beef breeding opportunities for NZ farmers.”

All of the cattle in the progeny test are born on Pāmu’s Renown farm at Wairakei Estate and reared and finished under commercial conditions at Pāmu’s Orakonui farm, also at Wairakei Estate.

The weights of all the calves are recorded at 200, 400 and 600 days.

Calves are run in four groups after weaning (two groups of heifers and two groups of steers) for finishing and are DNA-verified to Progeny Test sires.

In 2019, B+LNZ entered into partnership with LIC (which helps fund the test) to ensure dairy farmers have access to the best bulls coming through the progeny test.

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STOCK DAIRY BEEF

Beefing

UP THE CALF CROP

What traits and EBVs should dairy farmers be looking for?

Words by: Dr Jason Archer

A

s a dairy farmer, why would you take the time to select beef genetics to produce calves with growth and carcase traits that someone else will benefit from?

It’s a good question, but enhancing the quality of this country’s dairy beef has the potential to create greater value right along the value chain and importantly, using superior beef genetics will also reduce the number of bobby calves being processed in line with public sentiment.

I agree that our systems do not always reward the breeder (dairy farmer) for breeding genetically superior dairy beef calves, but we need to make a start. Producing calves that generate greater value for the finisher will have finishers seeking out calves that they are prepared to pay a premium for.

A closer connection between dairy farmers and finishers would certainly help create this value.

The advent of sexed semen has created an opportunity for using quality beef sires, a trend we are seeing around the world, for example in Ireland, Europe and the United States. In the latter, I’ve been involved in creating breeding indexes to identify Angus bulls for use in their dairy systems.

Many myths about using beef bulls over dairy cows have been dispelled and dairy farmers can now use the appropriate beef genetics with confidence that they will not create calving problems or longer gestation periods.

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The calf to be born without assistance or damaging the heifer or cow Select the EBV for calving ease - direct. This incorporates birthweight and gestation length into its prediction. You don’t need to look for calving ease maternal EBV unless the female calves are being retained as beef breeding cows.

The calf to be born early to increase the days in milk and when born at the end of the season, to shorten the calving span Select on gestation length, a negative EBV is better (shorter gestation).

A calf that is resilient, gets up and going quickly and achieves weaning weight as quickly as possible Don’t go too low in birth weight EBV, while still maintaining calving ease. While there are no real tools to select for resilience to disease or vigour, a moderate birth weight gives the calf a head-start to achieving a weaning weight in a shorter time frame.

A calf that grows well in the growing and finishing phase Look for good 400 and 600-day weight EBVs. A calf that expresses muscle well and has a good dressing-out percentage. Ultimately, a calf that yields the maximum amount of saleable meat. Look for eye muscle area EBV. This is expressed at a standard carcase weight so gives an indication of overall muscling.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

A calf that has adequate finish (fat cover) and finishes quickly Look at EBVs for fat (rib and rump). It’s difficult to set a target unless you know how the calves are performing in a finishing system relative to the breed and genetics being used.

Finishing animals require a minimum 3mm of subcutaneous fat cover and preferably 6mm at slaughter for optimal meat quality. Bear in mind, dairy genetics tend to deposit more fat internally rather than externally, but beef cross animals need to have a decent fat cover. Start by selecting bulls having fat depth EBVs which are slightly above average for the breed being considered and adjust from there based on experience.

Carcase quality (the ability to target premiums is often based on marbling) Consider a high value IMF% (intramuscular fat) EBV when targeting a high-value markets paying a premium for eating quality. The pH of the carcase is also important and this can be influenced by temperament in beef cattle (with EBVs for docility). This is not usually a problem in dairy cross beef animals due to the influence of their rearing systems.

Comparing apples with apples It is important to remember that unlike dairy EBVs which are compared across breeds, beef EBVs are within their breed only. This means Angus bulls can only be compared with other Angus bulls and not

Genetics specialist Jason Archer believes enhancing the quality of this country’s dairy beef has the potential to create greater value right along the value chain.

Hereford or Charolais, for example. This means the emphasis on the traits listed above might change depending on the beef breed being considered. This is why it is not possible to give ranges of numbers to look for, as they differ between different breeds.

Consider the cow Does the bull selection matter depending on the breed of cow? In the US, the American Angus Association created different indexes to use over a Holstein versus a Jersey cow. For Holstein, the emphasis was on marbling and less on growth and avoided the very tall bulls as processing plants were reporting issues with the very large frame US Holsteins.

We don’t have a height EBV available in NZ for beef bulls, but because cows are a more moderate size with smaller carcase weights there is not the same need.

For Jersey, the emphasis was more on muscling (eye muscle area) and growth, as these were the two attributes that needed enhancing when producing beef cross calves. Similar principles would apply in NZ depending on cow type and breed mix. But both major dairy breeds have a natural tendency to produce good levels of marbling, so the potential to produce high eating quality in the beef dairy cross carcase is already there.

• Dr Jason Archer is Genetics Specialist with Beef + Lamb New Zealand Genetics.

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Far left: Delwyn Tuanui started off delivering blue cod around Melbourne by hand.

Left: Chatham Island blue cod.

‘I CALL MYSELF A FISHMONGER’ With uncertainty threatening farmers on his island home, Delwyn Tuanui was inspired to set up his Chatham Island food exporting company. By Rebecca Greaves.

R

unning around Melbourne in his early 20s with a chilly bin full of Chatham Island blue cod, knocking on the doors of the city’s top chefs, Delwyn Tuanui knew he had a special product.

Chatham Islanders have long known how good their blue cod is, and now Delwyn and his wife Gigi have built a business that supplies high-end restaurants and delivers direct to your door, all from a remote island with a population of about 600 people.

Their hard work and dedication were recognised on a bigger stage when Chatham Island Food Co took the top honours at the Outstanding New Zealand Food Producers Awards for 2022. They won the supreme award with their Pure Pāua Mince - the first Maori producers to win the top accolade. Delwyn’s family has a long history on the island, he is a seventh-generation Chatham Islander with a background in farming and seafood. As well as the farm, his father had pāua quota, and Delwyn was diving for pāua from the age of 12. Initially, however, it was with red 80

meat rather than fish where he thought his future lay. A pivotal moment came in his early 20s, when returning home to help his dad on the farm he could see the uncertain future of farming. The downturn meant it was costing more than it was worth to get their livestock to market. They had to make the heart-breaking decision to cull sheep instead.

“Dad was pretty upset, like a lot of farmers he loves what he does and takes a lot of pride in his animals. I had this vision of myself 10 years down the track doing the same thing, and I was like ‘this is not for me’. Out of any dark moment there’s always that light you can choose to see and take, and it was a life-changing moment for me.

“I decided I’m going to go out to the world and I’m going to do something about this because I love my island, I love the people here and I can see this huge amount of potential here, but we have to change things, because this is not working.”

He knew a change was needed, and decided to head back to university to study at Marcus Oldham agricultural college in

Victoria, Australia, to upskill in marketing and business.

It was here he met his future wife, Gigi, and that he had a lightbulb moment about Chatham Island blue cod. Invited to a backyard barbecue one day, he took some kaimoana, blue cod, with him. When his friends ate the fish, he realised there was something unique in the product, and its story. The rest is history.

“Their response triggered a bit of a lightbulb moment and I started a pretty close relationship with the Chatham Island blue cod,” he says.

“I call myself a fishmonger, we essentially buy fish off local fishermen who catch it and we have infrastructure on the island that allows us to break that fish down. We package it and present it in a way that’s ready for our customers in New Zealand and around the world to eat.”

They specialise in Chatham Blue (blue cod) which is their champion fish, as well as kina and pāua.

“The number one thing is isolation. We are one of the most isolated communities in the world, 800km from the east coast of the South Island. Growing up, living and working in a really remote place creates a certain type of person and you develop certain skills and traits.”

Delwyn’s passion for his island, and the draw he felt to return, is evident when he speaks.

“You’re on a rock in the middle of the ocean and you’re submersed in your environment. I guess being so submersed in the land and the sea, you create a real connection to it.

“Deep down within me there was always that pull to come back. That epiphany with the sheep is what inspired me to start Chatham Island Food Co.”

From the Ground Up is a series of conversations with young Kiwis building their business in the primary industries.

You can hear more of Delwyn’s inspiring story at: nzfarmlife.co.nz/podcasts-2

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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RESEARCH WRAP NARF

Future Dairy Farm systems for Northland Words by: Delwyn Dickey

T

he results are in for the first year of a four-year trial at the Northland Agricultural Research Farm (NARF) at Dargaville, looking at three future farming systems as the north warms up and becomes more prone to droughts.

The three different farming systems are looking at performance using alternative pastures, reducing emissions on a traditional ryegrass-based farm, and the farming system recently highlighted in their previous trial as being the most profitable, being used as the control.

Run by the Northland Dairy Development Trust (NDDT) the research farm is split into three 28-hectare farmlets, with milk from the different farms collected separately.

• The current/control farm - uses ryegrass and kikuyu pasture, with imported feed - palm kernel expeller (PKE) to fill feed deficits before milk fat evaluation index (FEI) limits are reached, with a stocking rate of three cows per hectare, with up to 190kg of applied nitrogen per hectare.

Research from the previous four-year research showed this system was the most profitable.

• The alternative pastures farm has at least 75% of fescue, cocksfoot, legumes and herbs pasture, and also uses palm kernel to make up feed deficits. Stocking rates are also three cows per hectare and up to 190kg of applied nitrogen per hectare.

• Fonterra is providing funding to monitor 82

if there is a difference in milk quality and composition.

• The low emissions farm: This system uses existing ryegrass and kikuyu farm pasture and targeted a 25% reduction in methane emissions and a 50% reduction in nitrous oxide emissions (compared to the current farm). The stocking rate was dropped to 2.1 cows per hectare, with no nitrogen application.

Low emissions farm Using the Overseer model, the low emissions farm reduced methane compared to the current farm by 33% and nitrous oxide by 47%. There was also an 84% reduction in input CO2, and 9% CO2 reduction per kilogram of milk solids.

There was little feed quality difference in this farm compared to the current farm and there were some unexpected gains with pasture growth not down as much as expected despite no applied nitrogen, likely because of the high nitrogen-fixing clover counts in the pasture, and relatively longer grazing rotation with a somewhat too conservative stocking rate. This also had knock-on effect with some of the results including seeing more silage able to be made, eliminating the need for imported supplements.

Northland Agricultural Research Farm (NARF) manager Kelvin Horton with Northland Dairy Development Trustee Kim Robinson discussing the four year trial which investigated three future farming systems.

Crude protein levels were lower during late winter/spring and saw lower milk production at this time compared to other farms.

Clover was almost twice as high on this farm – between 40% and 50% of pasture during spring compared to the current farm.

Mating results were similar between

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

farms although this farm had a 3% empty rate compared to 11% on the current farm.

But overall, the farm had the lowest milk production on the three farms at 794kg milksolids (MS)/ha or 370kg MS/cow compared to the highest on the current farm with 1284kg MS/ha or 409kg/cow.

Financial analysis using the $9.30/kg MS milk price, with the low milk production saw this farm significantly dropping profit, with an operation profit of $3021/ha compared to the current farm at $5040/ha.

The milk price would have to drop to about $5.00/kg MS before this farm stopped being the least profitable.

Even if the significantly higher cost of nitrogen at the moment remained at $1340/tonne delivered, this farm would still be significantly less profitable than the other two.

The cost of reducing emissions through reducing stocking rate and removing nitrogen application and imported supplements was significant.

The pricing mechanism to encourage farmers to reduce emission has yet to be confirmed, however it is unlikely the emissions pricing will be high enough to compensate for the significant loss in profit shown in this study, researchers found.

Alternative pastures farm Many farmers in the north are turning to tall fescue and cocksfoot pasture as ryegrass struggles to persist in the dry and heat of the warmer months. Alternative pastures also strongly resists kikuyu reinvasion compared to the three years currently seen with kikuyu and ryegrass pasture.

To get this farm up and running by the trial start in June 2021, 9ha was sown in May 2020 with combinations of fescue, or fescue and cocksfoot, with white, red and Persian clover.

Another 11.6ha was sown in March 2021 with either fescue, or fescue and cocksfoot, or cocksfoot with white clover, red clover, and 1kg/ha chicory.

While the pastures sown in 2020 established very well, establishment on the pastures sown in 2021 was varied and in some areas poor. This was mainly due to competition from poa annua. As a result, 4.2ha was resown in autumn 2022.

In some respects this puts the alternative farm at a disadvantage as the kikuyu and Italian ryegrass pasture on the other two farms is mature and well established.

Pasture feed quality was higher for the alternative farm through the year except for spring. This is likely down to chicory in the pasture becoming dominant over

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

summer and autumn. The chicory is also likely behind the highest levels of protein seen in this trial over these seasons.

Pasture cover for this farm was significantly down from late spring to autumn.

About 800kg DM/cow of supplement was used by both this farm and the current farm.

Milk production was somewhat down compared to the current farm at 1213kg MS/ha and 397kg/cow but well above the low emissions farm.

Financial analysis also saw the farm slightly behind the current farm at $4780/ ha operating profit.

Emissions were slightly down on this farm compared to the current farm but methane emissions were about a third higher than the low emission farm and nitrous oxide twice as much.

Results from next year once the alternative pasture has established better may well give a better representation of performance, particularly compared to the current farm.

Current farm This farm kept its position as having the highest milk production at 1284kg MS/ha as well as being the most profitable with $5040 operating profit/ha.

It has 70% kikuyu with mulching each autumn and drilled with Italian ryegrass.

The 190 kg allowance of nitrogen/ha saw 1376kg DM/ha more than the low emission farm. With three more years of this study to run, the farming systems will be tested over different climatic conditions and will show if any of these effects – like the presence of clover - compound over time.

Stocking rates on the Low Emissions farm will increase by 0.15 cows/ha in this coming season.

Full results can be found at www.nddt.nz under current trials Future Farm Systems Financial Results year 1.

The project is funded by DairyNZ, MPI (Sustainable Farming Fund) and Hine Rangi Trust.

83

WELLBEING HEALTH AND SAFETY

Yarns that save lives Harriet Bremner makes an Aussie connection with a life-saving focus.

D Harriet and Alex Thomas.

84

uring the lockdown in 2020, I was lucky enough to work alongside Australian social entrepreneur Alex Thomas as we launched her #Plantaseedforsafety rural social change initiative platform into New Zealand.

We gathered some wonderful women and shared their stories so they could sit alongside their Aussie counterparts - because let’s face it, women care and think about things differently to their other half, their children and even their parents.

Being involved in this launch for me was proof that we do need to do something about the state of health and safety in agriculture in NZ and we still have a long way to go.

Alex believes rural women are the door that provides the opening to changing our attitudes towards health and safety in agriculture. She knows it is men who are more likely to die in an accident and farmers, in general, are eight times more likely to die at work.

Women, as we know, care. Care about our loved ones coming home at the end of the day. Often women are the ones either at home waiting for ‘him’ to get back, knowing he is working with machinery or in a remote area and having that feeling inside you when you aren’t sure if they are okay or not, is downright awful. I have been there as I imagine countless others of you have been too.

Others of us are farming alongside our male coworkers, partners, sons and more and see first-hand how differently we think about getting the job done. We tend to stop and think about how best to do the job, not just throw ourselves at it with the ‘she’ll be right’ attitude. This keeps us safe and it can be so frustrating watching those around you do things on a daily basis that they only get away with by good luck, not good management.

Alex knows women have been planting the

seed when it comes to health and safety in rural communities and she is on a mission to engage men in this part of their lives by adopting the #SaveALifeListenToYourWife slogan.

Her personal story of her disabled dad and former farmer, who continues to fight for his life from a multitude of health issues is where Alex gets her drive to help others.

Her dad was a farmer who, like so many blokes, was relentlessly committed to providing for his family, and getting the job done, at all costs.

He didn’t take holidays, breaks or eat properly, go to the doctor etc - he just burnt the midnight oil....

Health and safety aren’t always things that have an instant impact on us - think chemical handling and gaining cancer down the track or hearing loss from years on a post driver with no ear muffs.

When we cannot see instant backlash from our actions, we carry on without thinking about how it could affect us and our lives..

What I would love readers to gain from this column is knowledge. Head to the #PlantASeedForSafety website plantaseedforsafety.com/about/ - and you will see a multitude of stories that have been shared by women in agriculture both in Australia and NZ. They offer advice and tips on what has worked for them in their farming practice. These are practical tools that can help you with your own health and safety on the farm.

You might even want to share your story about what you do so that you too, can help others and save a life.

I thank Alex for her incredible leadership in this space. Without people like this we would continue to face unnecessary tragedy in our rural communities. Instead, let’s focus on making changes that can and will save a life because the aim is to get the people we love home at the end of every single day.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

THE ALL-ROUNDER

Simmental bulls are definitely the all rounder’s when it comes to making money.

In the latest LIC and Beef and Lamb dairy beef Progeny test report Simmental bulls, ended up in the top 20% of most traits, making them the perfect bull option for you.

First cross Simmentals gain weight rapidly and finish heavier than other breeds, earlier.

Simmentals greatest traits: $ More calves $ Heavier calves $ Market flexibility $ Shorter gestation length $ Earlier weaning age Then let Simmental show you the money.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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85

DAIRY 101 BRANDING

THAT SIGN AT TH E GATE

Passers by are familiar with the dairy company signs on the gates of New Zealand dairy farms. But there’s more. Story and photos by Karen Trebilcock.

D

on’t think you have a brand for your farm? Don’t think you need one? Think again.

Everyone driving past your gateway knows you’re a dairy farmer when they see your supply number whether it’s Fonterra’s, Open Country’s or one of the others.

They can look across the fence and see your paddocks, whether you have irrigation or not, a modern dairy or a falling-down herringbone.

If your cows are by the road fence they’ll see if they’re fat or skinny, if they are on lush grass or deep in mud.

If you’re on your quad bike they’ll notice if you’re wearing a helmet, if you have passengers, if it looks unsafe.

All of that is branding. It’s creating a perception of a company and its products in the customer’s mind.

It might not be by using logos and names such as Apple and Nike do. That person driving past will not know your mission statement, even if it is written down somewhere, but they will be forming an opinion about your business 86

and that is what’s important.

It’s something other sectors in agriculture are very aware of.

For a brief few years we had a very small (very, very small) Merino flock. Our wool broker said we needed a high country farm name to sell the wool under so we became briefly Walnut Flat Station, all 2.4ha (which included two large walnut trees) of it. The wool sold.

So if you’re grumpy about the perception of dairy farmers, and who isn’t, there is a lot you can do.

And it’s not that hard. For starters, you probably already have a brand name.

Most dairy operations work as companies which means you have a company name and company names must be unique.

Under the Companies Act 1993, a name can’t be used if it is “identical or almost identical” to that of another registered New Zealand company.

Cows, Cows and Me, Cows

with Milk, Happy Cows and Love Cows are already taken, sorry, along with More Cows, Fat Cows Farming, Hooked on Cows and the clever Heard of Cows.

Your company name can be more than simply what the accountant and bank manager see. It can be on your farm gate, it can be on the overalls of your farm staff and the name of your social media page.

And it’s a name you should be proud of – that when people say it, it makes you and them smile for the right reasons.

Your kid wants a hat with the Nike tick logo, your contractor wants to come and make your balage because they know you pay on time and a waratah won’t got through their tractor tyre while they’re doing the job.

But it can be much more than that.

A branding strategy, such as what Nike uses, is a long-term plan to reach your goals resulting in your identification by the consumer.

And as a dairy farmer whose product goes into a paper bag with the words Made in New Zealand and Whole Milk Powder on it, that’s a lot of consumers. Think about what is important to you – grade-free milk, cows fed the best they can be, staff who don’t

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

want to leave. Transfer that into something consumers can understand – the best dairy produce, happy cows, committed staff.

Add it to your farm road sign and then everyone driving past will remember it, as will your staff, your contractors, the tanker driver. And you.

You will have to uphold to that branding and always work to maintain it or someone will be quick to point it out.

Lake Hawea Station caused a small storm in the local newspaper about a year before it made an even bigger one on Country Calendar. Someone had driven past and seen on the side of the road a sign declaring the farm as carbon neutral. How could that be, the letter to the editor had asked, as the station looked like every other farm on the road?

A furore developed over what carbon neutral meant, whether climate change

was even a thing and what vodka makers were doing trying to farm.

But the owners stood up to their claim, explained it, and got the credit they deserved. If you are going to put a stake in the ground, or a farm sign, make sure you can live by it.

And if anything, the people who thought up 42 Below Vodka know a lot about branding. Those farms that have won Ballance Farm Environment Awards should have it on a sign at their gate, as should the Dairy Industry Award winners.

Imagine if you could proudly display how many times your staff have won the trainee and manager’s awards.

That branding would show you were a great employer. Or that you have QEII land in trust, or that you actively trap pests, or your waterways are planted, the water is clean and you know it because you test it

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

and how many native trees you’ve planted.

All dairy farmers are doing these things but how many people who drive past our farms know it?

And, just as Nike do, you can make a stand when there is something happening in the wider farming world that you’re not happy about.

There are lots of signs along rural roads about vaccination and Three Waters but none of them are really about dairying, or what is happening with dairying. How about a comment on the current laws on employing overseas workers (just how short is our workforce on dairy farms?), or the EU not letting us use the word feta to describe the great cheese we make or something about the pollution of urban waterways. Make your stand and be proud of it. Own it.

Or as Nike says – just do it.

87

What’s

NEW?

SOLUTIONS REPLACERS

McFadzean Cruizy Calve Angus bulls hit the market

T MaxCare extends calf feed range

T

hree new products have j been added to the MaxCare infant animal range exclusively available in New Zealand through PGG Wrightson stores.

MaxCare NZ sales manager Philip Spies the company wants to be “the preferred partner and the company that people turn to for all their infant animal needs”.

MaxCare was established around a core business of milk replacers for infant animals, primarily calves reared in dairy systems.

Since launching here in 2018, the brand has developed national distribution through exclusive partners PGG Wrightson and responded to demand for a more extensive range of products to service a broader market with MaxCare products.

MaxCare’s three new products were added from the start of August 2022 and the company has a commitment to continue adding new products in coming years.

“We are really excited about this next phase in our business.

This will allow us to offer our existing customers a wider range of product solutions and open up new opportunities with farms who traditionally haven’t used milk replacers.”

Spies says MaxCare had worked closely with its technical supply partners across Australia, North America and Europe to develop the new product range.

1. MaxCare Electrolyte PREMIUM is a scientifically formulated electrolyte with comprehensive hydration properties and buffering capacity.

2. MaxCare Probiotic Paste PREMIUM is a supplement for calves, offering a scientifically formulated probiotic containing a source of viable, naturally occurring microorganisms to support gut health.

3. MaxCare Whole Milk Additive PREMIUM is a comprehensive blend of vitamins, minerals, probiotics and in feed solutions to bolster the performance of animals fed with whole milk.

88

his year’s annual McFadzean Cattle Company yearling bull sale on September 8 will include the first offering of low-birthweight, short gestation, calving ease yearling bulls from its recently acquired herd.

Stud master Johnie McFadzean manages the company’s Meatmaker and Super Angus breeding programs plus the new Cruizy Calve Angus herd on the family’s property west of Carterton in Wairarapa.

He says the 35 Cruizy Calve yearling bulls being offered at next month’s sale will be ideal for mating heifers in either dairy or beef herds.

Their search last year for a source of genuine low birthweight Angus cows to establish a top breeding herd led them to buying females from the DavieMartin family’s Puketi Angus Stud at Waiotira, Northland.

“They have been producing one of New Zealand’s leading low birthweight calving ease herds with good growth rates for a number of years so when we heard they had some females for sale, we had to take a look,” Johnie says.

“We were really impressed with the cows. Craig and Don let us go pick for pick through their herd, so we ended up with 100 females including many trait leaders for calving ease. We also bought another 20 top females from Meadowslea in the South Island.”

The McFadzean Family calve 1500 beef cows and mate 450 heifers annually.

“The Cruizy Calve cows have been here on Glenbrae for the past 12 months, running on steep hills with the commercial cows. I’m really impressed with how docile and cruisy they are to manage and to calve.”

“At calving they are behind a wire because I have to catch, tag and weigh each calf, but they have great temperament so that’s an easy job. They calve within 30 minutes of starting and I haven’t had to help any of them.”

2022 calving has hit the ground running with calves being born between 5-23 days before their due date, weighing a healthy 25-32kg.

The sale venue is Glenbrae, 216 Wiltons Road, Carterton, and it starts with the Meat Maker and Super Angus yearling bulls followed by the low-birthweight Cruizy Calve Angus yearling bulls.

• For more information, visit mcfadzeancattlecompany. co.nz or phone Johnie McFadzean, 06 379 7401.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

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89

OUR STORY 50 YEARS AGO IN NZ DAIRY EXPORTER

50 years ago in the Dairy Exporter August As NZ Dairy Exporter counts down to its centenary in 2025, we look back at the issues of earlier decades. 50 Years Ago – August 1972.

A WOMAN’S PLACE IS IN THE SHED

Does it take a woman to understand the female of the species?

To many men, who have failed to fathom the ways of those strange creatures, “women”, it surely seems that only a female can understand a female.

This attitude is paying off in the milking shed where some dairy farmers consider that women are far more effective at improving cow performance than the majority of men.

Indeed, one progressive young Waikato dairy farmer envisages times when women may be employed for milking and light duties about the farm and men employed for heavier work.

“They’ve shown a human concern for every cow, the ability to give individual attention and to understand each cow,” Mr Frank Drummond, 29, said, who has employed four women at different periods.

“Women are far more maternal and handle cows quietly and easily.”

The result - contented cows, improved milk letdown, better production . . . and a happier boss.

LIVESTOCK IDEAS FIRMING

The idea of a national Livestock Improvement Organisation is gaining substance as talks continue and the Dairy Board becomes involved in beef progeny testing and aspects of weight recording.

The proposed livestock organisation has been talked about for approximately the past two years but, since last August, the discussions among producer boards’ representatives and the Department of Agriculture have become more definite on the broad outline of what the organisation 90

should do and how it might be established.

In general, the thinking is that the organisation should coordinate work being done to improve genetic and other qualities in dairy and beef cattle, in sheep and possibly in pigs, as well as providing and autonomous body to oversee farm livestock improvement on a national basis.

The most recent suggestions are that beef and sheep improvement councils could be set up alongside the Herd Improvement Council of the dairy industry.

WOMEN’S HAIR DYE THE KEY TO NEW STOCK MARKER

Common hair dyes and bleaches have triggered a new cow marking system that is visible at long range and which may be commercially available before Christmas.

The developers expect the system will have widespread application and will help overcome the world-wide difficulty of marking cattle easily and cheaply with symbols that can be seen from both long and short ranges.

Identifying numbers or symbols can be “finger painted” a foot or more high on a cow’s flank with either the peroxide bleach or a black dye. They stand out with marked clarity and can be readily seen across a paddock.

ACID VAT WATERS STOCK

Plastic is being used for so many things these days that Dave Greenwood of Northland reckoned it could be ideal for stock watering troughs.

“I tried to get one,” says this overseer on the Lands and Survey’s Te Paki Station,

Cover photo: Looking into a herringbone milking shed on a Waikato dairyfarm at Frankton (National Publicity Studio).

“but there was nothing around.”

“Eventually I came across this old vat. I think it’d been an old acid vat but it was too high.”

Cut down to trough height, it’s now had two years of trial and proved highly satisfactory, he said.

Made of black, low density polythene, the trough is light and easy to clean. No break down has occurred due to ultraviolet light.

SILENCE IS GOLDEN

My three young sons and I spent the May school holidays in a dear wee seaside cottage without the luxury of a radio, TV or telephone.

Oh! The sheer joy of a noiseless 11 days, except for the occasional chatter of the lads.

This modern space age world is so noisy and confusing that utter silence is like balm to the soul.

We came home firmly resolved to repeat this type of holiday next year. I’m sure the very quietness gave us all time to collect our thoughts and realise that the material things of life are of little consequence.

• Thanks to the Hocken Library, Dunedin.

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

Check out our latest episode on Wintering - not just a Southland issue

Dairy Exporter | www.nzfarmlife.co.nz | August 2022

91

COMMITTED TO NEW ZEALAND. COMMITTED TO YOU.

We’re here for NZ farmers for the long haul. We’re Boehringer Ingelheim, the name behind the brands trusted by farmers.

Season after season, brands like ECLIPSE®, EPRINEX®, MATRIX® and BIONIC® have been trusted on farm to deliver exceptional health and production outcomes for farmers. Boehringer Ingelheim is the name behind these brands that continues to invest in NZ agriculture by developing and manufacturing these products right here in NZ, ensuring kiwi farmers maximise production - not just this season, but for many, many more to come.

92

PROUDLY AVAILABLE FROM YOUR LOCAL PARTICIPATING VETERINARY CLINIC. Boehringer Ingelheim Animal Health New Zealand Limited. Level 3, 2 Osterley Way, Manukau, Auckland, New Zealand. MARKS-MIN®, EPRINEX®, ECLIPSE®, MATRIX®, and BIONIC® are registered trade marks of Boehringer Ingelheim Vetmedica GmbH, used under license.

Registered pursuant to the ACVM Act 1997, No. A011687, A007191, A009270, A011151, A009390, A011825. See product label for full claim details and directions for use. © Copyright 2022 Boehringer Ingelheim Animal Health New Zealand Limited. All rights reserved. NZ-BOV-0009-2022.

Dairy Exporter | www.nzfarmlife.co.nz | August

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