Dairy Exporter January 2021

Learn, grow, excel

January 2021 How to get

MORE SLEEP Avoiding PHOTOSENSITIVITY

Explaining fixed milk price

FLEXIBLE MILKING $12

JANUARY 2021

$12 incl GST

Less milking, more freedom MON 5am/3pm

TUE 11am

in

WED

10 7

THU

FRI

SUN

5am/3pm

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

SAT

11am

OAD

5am/3pm

5am/3pm

11am

24 REPEAT

05:00 15:00 DAY1

32 IN

11:00 DAY 2

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Dairy Exporter | www.nzfarmlife.co.nz | January 2021

38 EN ROUTE TO FARM OWNERSHIP

CONTENTS MILKING PLATFORM 10 Alex Lond is a convert to Max T 11 Carla Staples considers the highs and lows of 2020’s

second half

12 Anne-Marie Wells believes good bosses breed good workers 13 Niall McKenzie gets a doctor’s check-up

22 CASH FLOWS FOLLOWING YILI PURCHASE

UPFRONT 14 Capital gains tax: Tackling the speculators 18 Market view: Dairy in good spirits 20 Global Dairy: Clues to UK’s post-Brexit dairy future emerge

BUSINESS 22 West Coast: Cash flows following Yili purchase 26 Lending flexibility needed 27 CO Diary: Check on your employment agreement 28 Fixing milk price

SYSTEMS 30 Exploring the potential of bananas 66 COUNTING DOWN WITH MASTITIS

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

34 E350 Farming’s new generation leaders

3

TF

TOW AND Fert

REDUCING THEIR NITROGEN Align Farms drops under the 190 Units N/Ha limitation one year before they need to.

Rhys Roberts, CEO of Align Farms, knew they needed to change their nutrient programme. He and his team changed to foliar application, using a Tow and Fert across the company’s five dairy farms. They reduced their Nitrogen inputs, grew more grass, and produced more milk one year before the government regulations kick in.

LEARN HOW ALIGN FARMS ACHIEVED THE FOLLOWING:

  

Reduced their ‘N’ inputs across their farms by up to 33% Went from a farm average of 246 units ‘N’ per ha to 173 units ‘N’ per ha Reduced their milk urea from 20 to 25mg/dl to between 3 and 5mg/dl

Read the FULL Case Study.

“The Tow and Fert system is versatile, pragmatic and does everything that we need it to do”.

Rhys Roberts CEO, Align Farms

Or watch the videos www.towandfert.co.nz/align

N, P, K

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TOW AND FERT: THERE IS ONE FOR YOUR FARM CALL 0800 337 747 FOR A FREE ON-FARM DEMO

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4

www.towandfert.co.nz

CALL 0800 337 747 orExporter email| us at dairy@towandfarm.co.nz Dairy www.nzfarmlife.co.nz | January 2021

SPECIAL REPORT MON 5am/3pm

FLEXIBLE MILKING

Less milking, more freedom

TUE 11am

WED 5am/3pm

10 7in

THU

FRI

SUN

5am/3pm

SAT

11am

5am/3pm

11am

OAD 24 REPEAT

05:00 15:00 DAY1

SPECIAL REPORT: FLEXIBLE MILKING

32 IN

11:00

38 En route to farm ownership

DAY 2

43 Milking evolution

38 Enroute to farm ownership 43 Milking evolution

45 Times to attract new staff

45 Flexible milking times to attract staff 48 Flexible milking Q&A

48 Common questions farmers ask

49 Udder intervals explained 50 Making the system fit

49 Udder intervals explained 50 Making the system fit

ENVIRONMENT 58 Know your GHG numbers 60 Freshwater: Ministers get regulations advice 62 Environment plans driving change Dairy Exporter | www.nzfarmlife.co.nz | January 2021

37

64 Emissions: The climate neutrality question

STOCK 66

Counting down with mastitis

70

Technology: Ears to the ground

73

Vet Voice: Summer and photosensitivity

WELLBEING 74 Sleep: Combat the voice inside your head 76 The development trap 58 KNOW YOUR GHG NUMBERS

RESEARCH WRAP 77 No sign of SARA

DAIRY 101 78 Are supplements right for your farm?

SOLUTIONS 80 Collars mean connected cows 81 Start-up aims to create export opportunities

OUR STORY 82 The Dairy Exporter in 1971 70 EARS TO THE GROUND

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

5

DAIRY DIARY January 26-28 – The New Zealand Dairy Event is being held at Manfeild Agri-Centre in Feilding. The PGG Wrightson Summer Sensation Sale will also feature again. More? visit www.nzdairyevent.com

February 17 – A body-condition scoring workshop is being held on the Hauraki Plains.

To find out more and to register visit https:// www.dwn.co.nz/events/hauraki-plains-bodycondition-scoring/

January 27 – Canterbury’s winners of the Ballance Farm Environment Awards, Tony Coltman and Dana Carver who own Canlac Holdings, have a field day on their property.

Details about their win can be found at https:// www.nzfeatrust.org.nz and for more information about the field day contact Kaylene Fenton on 021 02871318.

February 21 – Entries close for the Fonterra Dairy Woman of the Year 2021 award. To make a nomination visit https://www.dwn.co.nz/ fonterra-dairy-woman-of-the-year/

February 4 – Lincoln University Dairy Farm focus day on the farm between 10am and 1pm.

More? visit www.siddc.org.nz February 10 – A workshop, Your Farm Business Future, is being held in Gore.

The Dairy Women’s Network workshop in partnership with ASB and NZ CA Ltd focuses on succession planning and preparing the next generation into farming and farm ownership.

The three-hour workshop runs from 9am to 1pm. Other dates/locations: February 15, Northland; February 16, Tararua; February 17, Bay of Plenty; February 18, East Waikato; February 24, North Otago. More? visit https:// www.dwn.co.nz/events/ February 10 – The 2021 Farmed Landscapes Research Centre (FLRC) workshop will be run as a one-day live Zoom webinar between 10am and 6pm. Participants can attend face to face or online. The programme will focus on how to get the most from farm environmental plans.

To register visit http://flrc.massey.ac.nz/.

February 25 – Greater Wellington winners of the Ballance Farm Environment Awards, Kaiwaiwai Dairies, has a field day on the South Wairarapa property. For details about their business visit https://www.nzfeatrust.org.nz and for more details about the field day contact Georgie Cranswick on 021 02356192.

DIA COVERAGE FOR 2021 Regional awards for the 2021 Dairy Industry Awards, with dinner: Central Plateau: March 2, Rotorua Bay of Plenty: March 4, Awakeri Waikato: March 6, Karapiro Northland: March 9, Whangarei Auckland/Hauraki: March 11, Karaka Canterbury/North Otago: March 16, Wigram West Coast/TOS: March 18, Greymouth Southland: March 20, Invercargill Manawatu: March 24, Palmerston North Wairarapa/Hawkes Bay: March 25, Masterton Taranaki: March 27, Hawera For more information visit www. dairyindustryawards.co.nz/regions/

March 4-6 – Northland Field Days are held near Dargaville and has the latest in farming innovations plus lots more. More? Visit https:// northlandfielddays.co.nz.

March 18-20 – Central District Field Days at Manfeild, Feilding has everything from the National Excavator Operator Competition to the latest mobile app technology, plus the latest developments in rural innovation. More?

Visit https://www.cdfielddays.co.nz March 23-24 – MobileTECH AG is being held at the Distinction Hotel in Rotorua. The annual event brings together technology leaders, innovative developers, early adopters and the next generation of primary industry operators.

It showcases digital technologies transforming the agricultural, horticultural and forestry sectors. To find out more and to register visit https://mobiletech.events/.

March 24-26 – South Island Agricultural Field Days at Kirwee in Canterbury are one of the oldest and largest agricultural events in the South Island. The event provides opportunities to view machines at work and attracts up to 25,000 people each year. For more information visit https://www.siafd.co.nz/.

March 31 – Entries close for the 2021 Dairy Business of the Year. Entrants undertake a high-level analysis of the KPIs within their business that drive profitability, resilience and sustainability, while benchmarking themselves against their counterparts. To enter, visit https://www.dboy.co.nz.

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Editor’s note

Sleep, glorious sleep

E

verything about life seems easier when you get enough sleep!

There is a reason that sleep deprivation was a torture technique used in many wars over past centuries. The body needs sleep to survive - to repair itself and perform essential biological functions - without enough sleep cognitive function suffers and the immune system gets stressed so you get sick more often.

It is one thing remembering the brain fog of sleep deprivation from having a baby in the house and a whole other thing to try and sleep and not be able to. Whether it is caused by underlying stress or anxiety about something that’s going on - it is one of the most frustrating things to be lying there and your brain whirring away not being able to relax and nod off.

Harriet Bremner has some great tips in our Wellbeing column this month of strategies to help you settle into a good sleep at night.

As she says, fatigue and good decision making don’t go hand in hand and when you are really tired things can go wrong very quickly, because your brain is elsewhere and very busy.

So if you have been having trouble sleeping, settle down with a glass of warm milk - or a handful of almonds (it’s the protein), after a hot bath and have a read of this one (pg74).

Recognising the importance of everyone getting more sleep is one reason many farmers across the country have embraced flexible milking routines, and there are lots of other reasons too.

We drill down into the practice in the

Building a sharemilking business with embryo transfer calves and top producing cows: Donovan and Sophie Croot, and Thomas the cool dude!

special report this month, and find it’s been revolutionary for some farmers - with many all over the country combining different milking frequency regimes through a season to better capture efficiencies of labour, farm logistics and time management and having equal benefits for the people - with stable weekends and more sleep-ins, meaning it is easier to attract and retain staff.

Farm Wise consultant Brent Boyce says it’s about specifically targeting the frequency of milk harvests per day to coincide with the quantity of milk being produced so that the same total amount of milksolids can be harvested through the season (pg43).

There has been a seismic shift over the past 10 years as the options and research has evolved.

Of course there are pros and cons for all the different regimes and we answer a few FAQS on page 48.

Change is never easy but if you can harvest almost as much milk with fewer milkings and lower costs in the shed, better for cow condition and for staffing and staff wellbeing, maybe 2021 is the year to have a look at making a change?

New Years resolution 2021: Get more sleep!

NZ Dairy Exporter @YoungDairyED @DairyExporterNZ @nzdairyexporter

Sneak peek FEBRUARY 2021 ISSUE

• Special report: Climate change: how are you counting the GHG numbers and preparing yourself and your farm?

• Global Dairy: What’s happening onfarm in Brazil?

• Dairy 101: Feeding out your hay and silage

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

7

NEW ZEALAND

NZ Dairy Exporter is published

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

NEW ZEALAND

Dairy Exporter Editor Jackie Harrigan P: 06 280 3165, M: 027 359 7781 jackie.harrigan@nzfarmlife.co.nz

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

Lead sub-editor: Andy Maciver, P: 06 280 3166 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: 03 489 8083 ak.trebilcock@xtra.co.nz

DAIRY DIVERSIFICATION AT MT SOMERS STATION

FIELD-TESTING REGEN AG

Andrew Swallow, P: 021 745 183 andrew@falveyfarm.co.nz Chris Neill, P: 027 249 1186 waipuvian@gmail.com Phil Edmonds phil.edmonds@gmail.com

We visited David and Kate Acland at Mt Somers Station where diversification is embedded in their intergenerational business vision. Dairy, beef, deer, sheep and honey, lambswool blankets, two country stores and a winery exporting to 17 countries. The 850-cow dairy conversion has been a key factor in making it all happen adding value without risking the overall business and land.

We visited Rhys and Kiri Roberts at Align farms to see the farm-scale trials they are running on regen ag vs. conventional dairying. They are collecting data on financial, physical, social and animal health metrics to make informed decisions and share with other farmers on the regen farming system.

Check out the Align Farms video on YouTube ‘Dairy Exporter’ channel.

PODCASTS: For all Dairy Banter Podcasts visit www.nzfarmlife.co.nz/tag/dairy-banter

www.youtube.com/watch?v=Km-83gw3Al0

MILK PAYOUT TRACKER: 7

Series 2, Podcast 2 In this podcast, Okoroire farmer Floyd Smit joins CRV’s Jenna O’Sullivan and Rosanna Dickson to talk about breeding with Polled genetics. www.crv4all.co.nz/podcast/series2-episode2/ Series 2 podcast 1 Join Rosanna Dickson as she chats with Dr Ky Pohler from Texas A&M University about his findings and how New Zealand farmers can ensure they are mating their cows at the right time. www.crv4all.co.nz/series2-episode1/ 8

7.00 6.70

$/kg MS

Series 2 Podcast 3 Determining the pregnancy status of your herd via milk can be done as part of your CRV herd test.

Listen to DairyNZ animal and feed developer, Sam Tennent, and CRV herd testing manager Mark Redgate to find out more. www.crv4all.co.nz/podcast/series2-episode3/

Average $6.93/kg MS

2020/2021 Fonterra forecast price 6.80

7.16

7.00

7.00

6

5

Anne-Marie Case-Miller P: 021 210 4778 annieproppy@gmail.com Design and Production: Jo Hannam jo.hannam@nzfarmlife.co.nz Emily Rees emily.rees@nzfarmlife.co.nz Social Media: Charlie Pearson, P: 06 280 3169 Partnerships Managers: Janine Aish Auckland, Waikato, Bay of Plenty P: 027 890 0015 janine.aish@nzfarmlife.co.nz Tony Leggett Lower North Island P: 027 474 6093 tony.leggett@nzfarmlife.co.nz David Paterson South Island P: 027 289 2326 david.paterson@nzfarmlife.co.nz

4

CONNECT WITH US ONLINE: www

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Elaine Fisher, P: 021 061 0847 elainefisher@xtra.co.nz

www.nzfarmlife.co.nz NZ Dairy Exporter @DairyExporterNZ

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Dairy Exporter | www.nzfarmlife.co.nz | January 2021

9

MILKING PLATFORM WAIKATO

I have also never (knowingly) had a problem with staff not enjoying milking, and the cows always seem chilled and happy in and out of the shed.

So, don’t fix what isn’t broke, right?

Shine a light on Max T She had heard about it before, but passed it up.

Now Alex Lond is a convert to the Max T method.

E

verybody’s talking about it – and I just couldn’t get my head around it. The Max T (maximum milking time) method is becoming more and more popular in and around the Waikato, and I wanted to know why?

After hearing about it from a friend after he won Sharemilker of the Year back in 2018, I somewhat dismissed it as an idea only needed by farmers who didn’t enjoy milking their cows. However, after attending a discussion group last week with a focus on executing the Max T method in herringbone sheds, I have seen it in a whole new light.

I have always enjoyed milking, seeing it as an opportunity to plan my day in 10

the mornings (in my head) and as the final job for the day (most of the time). I am fortunate that milking is not a long, drawn-out affair on my farm. I milk 350 cows through a 29ASHB shed, with recently installed in-shed feeding meaning that the cow flow is always excellent, both in and out of the shed, and the longest milking time this season has been 3 ½ hours from cups-on to taking my boots off for breakfast.

I have also never (knowingly) had a problem with staff not enjoying milking, and the cows always seem chilled and happy in and out of the shed. So, don’t fix what isn’t broke, right?

But then who doesn’t want to milk as

efficiently as they can? Before attending, I thought Max T meant not milking out your slow milkers, in an attempt to ‘train’ them to milk out as fast as the quickest cow in the herd. So, I thought that once you’ve finished cupping one row, you’d go back to the front and if the first cow was finished, you’d start cupping the next row and not stop for any slow milkers on the way.

Well, it is in fact much more complicated and well thought out than this.

Max T means everything has a set rhythm that can be implemented from the start of milking and is the same for all staff: you literally set a timer at the beginning of each row, cupping all the way down without stopping but then not starting the next row until your ‘time’ is up, with any spare time being used for more efficient teat spraying/hosing.

The argument is that you are saving time by keeping this regular rhythm rather than waiting on slow milkers and the cows are much happier because just like us humans, they love regularity.

Some of my frustrations with new staff or relief milkers are often unnecessary, pernickety things that only I really notice, so I repeatedly just let it bubble inside of me rather than scare them away with my pickiness.

With the Max T method, most of these things would disappear: you could introduce all the facts from the start on how the shed runs, and everyone will be doing it the same way because that’s how it must be done for Max T to be effective.

So am I a convert? Not just yet, but watch this space. In an ever-changing industry with new challenges presented to us every day it’s great to see so many farmers willing to adapt so that they can further improve the lives of both their staff and their cows.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

MILKING PLATFORM WESTLAND

The highs and lows of the Staples’ river through spring flooding.

Sowing the seeds of success for the future 2020 has been a year of ups and downs for the whole country. Carla Staples looks at some of the highs and lows of the second half of the year.

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ell, there has been a bit going on since our last column. Covid is still affecting the country, Labour won the election by a landslide, and here on the farm we finished calving early October and have just finished mating.

After a strong start to the season in August and September the weather took a turn for the worse during the end of September into October.

Although it was very wet it was also warm, so as long as we could keep the cows on top of the ground and some fertiliser going on (when the conditions allowed), we just managed to keep the growth rates high enough to meet demand. The new grass we managed to get sown in mid-September was a bit of a failure and

has had to be re-sown. We tried our best to meet the new freshwater legislation target date for pasture sowing post-winter cropping, but this season it was not possible. In our area we are not aware of many, if any, farmers who managed to get their grass successfully sown before 1 October.

This is something the bureaucrats in Wellington really must reassess; we all want to get our paddocks sown as soon as possible, but on the coast, we really are at the mercy of the weather and over the past two seasons we have struggled to get a window of good weather to get a tractor on the paddock before the middle of December.

Now the PM has declared a climate emergency in New Zealand we’re sure next spring the weather will be amazing, and

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

we’ll all have our paddocks back in grass well before the first of October! Sounds like the next Tui billboard.

Mating went really well for us this season, it was one of the best matings we’ve had since we’ve been farming. We ended up with a submission rate of 88%, which was a couple of percent shy of our target, but it was the first season we hadn’t used CIDRs. There are still areas we are constantly trying to improve, but overall we are very happy with how mating went.

The bulls will stay in until New Year’s Eve and then we will have to wait until scanning in February to see how well it really went, but the signs are very good at this stage.

As far as milk production goes, the girls are going slightly better than this time last year and we are around 6% ahead of last season. The payout is also looking very good at the moment. Hopefully it keeps tracking the way it has been throughout the rest of the season, although the strong New Zealand dollar is a bit of a concern.

We are still waiting for the predicted La Nina weather event to arrive to dry the ground out and get the grass really pumping.

Fingers crossed we have another fantastic summer and autumn to get our winter crops growing well and get some silage in the pit. We will also be subsoiling as much of the farm as possible; this was something we wanted to get done last autumn but ran out of time. We have managed to get seven paddocks done recently and it has made a massive difference to those paddocks already, with them drying out almost immediately after rain with no water sitting on the surface. These paddocks will also be topped up with some extra grass seed post-subsoiling just to fill in the gaps left from the wet weather. This was something we trialled last summer and has worked very well so far.

We hope you all had a great Christmas and New Year and managed to get time away from the farm to spend with family and friends.

11

MILKING PLATFORM OTAGO

Team work makes a great workplace.

Good bosses breed good workers Employment is a two-way street. Anne-Marie Wells gives some advice on how workers and bosses can improve staff relations.

O

ver the past year, I have seen many articles on the need for dairy farmers to be good employers, and I have to admit to being torn about how I feel with the “be a good boss” campaign. When I think about why it bothers me, I realise it’s the accusation of the statement, the suggestion that I am not a good boss – that none of us is.

I am in no doubt that people should do their best to be good employers – after all, in the same way animal welfare is so important to our business, having a good team is right up there. So why are there so many articles on this subject? Are there an equal number of articles telling employees to “be a good worker”?

As an industry, are we really such bad employers it justifies this many initiatives telling us to sort ourselves out? I hope not.

On our farm we try our best to create a 12

good work environment and to review and learn as we go. I know we are not unique and there are plenty of people doing it better than us.

That said, when we were last recruiting, I was surprised to hear accounts of unreasonable rosters, having to work rostered days off, late wages, and of one manager who simply didn’t show up if it was raining, so not everyone is getting it right.

I find it hard to believe the majority of dairy employers are like this; surely there wouldn’t be anyone left in the industry if they were.

Which brings me to wonder if these articles are the result of a lack of new interest in dairying careers? In which case, the focus could move to reviewing what is putting those people off; early mornings, working weekends, perceived lack of progression in the industry, the

dirty dairying label. I believe the majority of employers are far more aware than they used to be on how to create a good environment, I also believe employee expectations have changed.

As important as it is for employers to create a great work environment, employees have a responsibility to hold up their side of the contract.

To me, being a good dairy employee means valuing your job, your house, turning up on time and focused, admitting when you’ve done something wrong, taking care of equipment, saying thanks for a smoko shout, seeing out a season, keeping the house provided for you tidy. I can’t help thinking that when everything is focused on the employer getting it right, we run the risk of employees no longer valuing their employment.

Not everyone is getting it right when it comes to employment, but a lot of people are, and I am no longer convinced it is reciprocated.

I think it would be great if instead of bossing us to be good bosses, there was encouragement for the whole team – from the owner to the relief milker – to create a great workplace.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

MILKING PLATFORM NORTHLAND

Life on the farm.

Farming Fit Being proactive, Niall McKenzie took himself for a checkup with his doctor.

W

hen you have all the elements against you, you start to have doubts. You think that the world is against you and that couldn’t be further from the truth. We all have our own team in behind us. They are the ones that you can rely on to get the job done and keep you going. This is inspired by the recent TV programme called “Match Fit”. I found it incredibly humbling to see my All Black heroes suffering then striving. Powerful and inspiring.

Our action plan has been ‘more’ this season. More Nitrogen, more calves reared, more crop made, more balage and more time off. It might be a bit aggressive but we have had very pleasing results. We have high hopes that there will be a short summer dry and some good autumn growth.

Hope goes hand and hand with being positive.

As a reflection 2020 has been best described as nothing but being pretty

shit. We suffered a drought that lasted 5 months. Mentally and physically it was draining. Don’t get me wrong I like a challenge, but then add in Covid. Delwyn was working fulltime teaching since August 8 to help build cash back up again. Then an opportunity arrived of a additional 50/50 job next door.

Sometimes you can not see the forest for the trees. This is when you know you’ve got your team in behind you. They make you smile and say to you Niall you’re being a dick. That’s what true friends do keeping you real, honest and mentally fit.

I believe all your friends do this - even the negative ones. Without them we wouldn’t be who we are.

We contacted our mentors and accountant and asked them their thoughts on the new sharemilking job. The accountant said, “These opportunities don’t come up when you are looking for them and you will never get money from the bank at a cheaper rate than now”. Then she re-affirmed that we have a very strong

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

business. She said, “if you back yourselves a bank definitely will”. And sure enough two out of four major banks said yes, meaning that we got a competitive rate on the new loan.

On the 1st of February we add another 100 hectares on to the existing dairy farm. We are targeting calving down 200 autumn-calving cows (hopefully on budget). Then we are getting another 210 plus ha on the 1st of June with another cowshed on it. The properties are owned by our same farm owner. Very interesting times ahead.

Our key focus will be on our core values of Keeping It Simple Stupid (KISS) with a bit MORE. With a four year contract, I thought that I didn’t want to start the new venture and then get sick so I needed to be pro-active for Super Del. We have to be fair to the ones we love - for the next day and the next even when we are gone from this world. I feel part of that is looking after ourselves as well as them.

So I went to the Doctor. It was the first time in 6 years and I asked for a general check up. My timing was quite good as it was only two weeks after calving had finished. All blood tests came up positive and at the end of it the Doctor said “You are quite fit”.

I encourage all males to do this, to be fair to ourselves and the ones we care about.

13

UPFRONT TAX

INSIGHT

Tackling speculators Soaring residential house prices has seen renewed calls for a capital gains tax.

But as Phil Edmonds reports, farmers may have little to fear.

G

ather than drifting towards the end last year in postelection glory, the new Labour Government was confronted with having to fight a revived pesky nemesis – runaway house price inflation.

Given its limitless media appeal, advice was thrown at the Government from all corners. This included fresh calls to tax capital gains. Not being at the centre of the problem – in many ways far from it – farmers have been able to sit back 14

and watch the debate unfold from afar.

But might farmers be better prepared to contribute to what some are now saying is an inevitable change in tax policy?

After Prime Minister Jacinda Ardern categorically ruled out introducing a capital gains tax following the public reaction to proposals that emerged from the Tax Working Group (TWG) in 2018, there was a sense the matter was buried, and there was little point in discussing it further. It certainly drifted off the media’s

agenda, and even in the lead-up to the election last year no party gained any traction by raising it. The Greens shifted its focus to promoting a wealth tax instead.

That was before house prices started to go nuts. As the boom gathered steam towards the end of 2020 and the prospect of huge untaxed windfalls became a source of disquiet for those locked out of the property market, talk of taxing capital gains re-emerged.

This was no surprise to some tax experts,

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

Westpac economist Dominic Stephens.

‘The majority of farmers are located some distance away from urban centres, and therefore won’t be subject to sharp increases in capital gain. In terms of the overall percentage of farmland, it would be small.’ who remain convinced the way the New Zealand tax system is configured is unsustainable, and will inevitably have to change, irrespective of political promises.

After Ardern crossed out CGT in 2018, one tax consultant at the time suggested CGT was not dead, but merely resting.

Westpac economist Dominic Stephens shared that view in one of the bank’s economic forecasts in November. He said that as the “Government will still be running large deficits mid-decade, and beyond that time, our pick is that a future government will introduce some form of tax on assets, such as a land tax, capital

gains tax or a wealth tax. Societal concern about increasing wealth inequality is only going to intensify, eventually creating a large constituency for such a change.”

Some commentators remain convinced there is no chance of this happening with so much vested interest among those who own property assets, and who still constitute the largest voting bloc. However, population data shows millennials – broadly those who are relatively unwealthy, and the losers of escalating property prices – will become the biggest voting bloc by 2030, and the years approaching this will inevitably lead

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

to a change in thinking.

Given that, new taxes could well become a question of when, not if.

Of the options available, CGT is still top of everyone’s mind, partly because NZ is the only country in the OECD that does not have such a tax. As a result, there are regular appeals for NZ to simply join the rest of the world.

It’s not, however, as simple as a copypaste exercise. A closer look at CGT in other jurisdictions show a myriad of nuance in how it is applied, with rafts of exemptions and discounts.

In many ways its unwieldy administration made it easy to reject nearly two years ago. Some of the proposed features that contributed to that included: • The requirement of all qualifying assets to be valued on a certain date.

This would have been a valuer’s dream (if there were anywhere near enough valuers in NZ to do the dreaming) but a public administrator’s nightmare. The government rejected an option to only include asset sales after the rule was introduced, as Australia did in 1986, because it would have taken a long time to change the shape of the overall tax burden and would have raised very little revenue in the immediate future.

• No discount for inflation, as is made in other countries. This meant assets that did not make any real gain value would still be taxed. Again, the reason for this was because taxing inflation-adjusted values would produce significantly less revenue.

• Exempting the family home (including family home on a farm). While this was always going to be a feature, the reasons were political rather than based on tax 15

CAPITAL GAINS TAX ON FARMS IN OTHER COUNTRIES AUSTRALIA Capital gains tax – same as marginal personal income tax rate.

Some discounts and concessions apply for individuals who sell all or part of their farmland. If your home is part of the working farm, you may be eligible for a partial main residence exemption. You may also be exempt if you are over 55, are either retiring or permanently incapacitated, and have owned a working farm for over 15 years. If you are a retiring small business owner selling your business (including farms) you may also seek exemption from CGT – in recognition that small business owners, unlike employees, are likely to have far less retirement savings.

To address this imbalance, farmers may be eligible to disregard up to $500,000 of the capital gain on the sale of a farm.

IRELAND Capital Gains Tax – 33% Principal private residence and surrounding gardens etc is exempt from CGT, but any ‘development value’ is liable (for example, if part of the land is sold off). Retirement relief from CGT is available where an individual, who is at least 55 years of age, disposes of an asset (farm business, for example) and they have owned it for at least ten years. Full relief may also be claimed by an individual aged 55 – 65 years of age on the disposal if the whole or part of the qualifying assets are transferred to their child.

CANADA Capital Gains Tax - Half of a capital gain constitutes a taxable capital gain – taxed at ordinary personal income tax rate.

Farmers may be able to take advantage of the lifetime capital gain exemption. The farm must have been used principally (more than 50%) for the business of farming by an individual or family.

Sale of a farming business that includes your principal residence (typically 0.5 hectare) will generate partial CGT exemption. There are also significant opportunities for tax savings from transferring farms within families.

16

efficiency. The experience of exempting family homes in Australia has simply encouraged more frequent buying and selling as people engage in ‘castle building’.

Otago University tax policy lecturer Andrew Coleman says despite the Government attempt to minimise exemptions, the modest level of revenue the proposed CGT was going to generate means it has arguably been overhyped in terms of its ability to solve the problems with the tax system the TWG initially set out to fix.

Coleman says it would still be worth introducing to bring NZ in line with other countries, but to make it effective, it should be applied each year as land values go up – on an accrual basis rather than on a realisation basis.

What are the implications for farmers of a revived CGT? Should it be feared?

First, the reaction among prominent farming voices when the TWG Working Group revealed its recommendations in 2018 were conclusively negative on the proposition to introduce a capital gains tax. Federated Farmers’ then vice-president Andrew Hoggard labelled the CGT proposal a ‘mangy dog’, that would add unacceptably high costs and complexity.

This was to some extent countered

by PwC partner and member of the Tax Working Group Geof Nightingale, who said very few of the specific CGT recommendations would have affected farmers in the short-term.

So are farmers right to continue fearing a capital gains tax as much as other land asset holders?

While no ardent fan of CGT, Manawatubased rural accountant Michael Lawrence

Manawatu-based rural accountant Michael Lawrence.

suggests farmers should not be terrified – at least based on its introduction being a means to stifle the rampant property market.

Lawrence says farmland is not typically subject to speculation (most people buy farms for long term ownership), and that the focus of farm ownership is now more likely to be for business profitability rather than accumulation of capital gain.

“If you look back two decades at the trajectory of dairy land prices, you would have seen a massive increase in prices in the five years to 2010, but prices now are probably no dearer than they were in 2010, if you remove inflation. So there probably hasn’t been much speculation in dairying over the last decade.

“For sheep and beef farmers, there may have been some recent movement with the forestry incentive where farmers have sold to foresters and have then spent that money on cheaper dairy land but this is not really speculation that compares with what has gone on in the residential property market.”

Lawrence says a slight exception might

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

be some people who have speculated on farms close to urban centres with a view to convert them to housing or lifestyle blocks. But land use change for this purpose is more likely to have been a result of existing farmers getting to a point where the land has a premium value over farming value.

“The majority of farmers are located some distance away from urban centres, and therefore won’t be subject to sharp increases in capital gain. In terms of the overall percentage of farmland, it would be small.”

The other reason why farmers have less to lose from a CGT is that they have had to become more focused on income than capital gain in terms of their farming proposition. Lawrence says “farmers haven’t quite put capital gain to bed, but income is far more important. For quite a long time, capital gain would have dominated farmers minds, but over the last decade there is much more emphasis on producing income, if only for banks increasingly wanting to see the principle of loans paid off.”

Lawrence’s overriding view is that CGT is an unnecessary worry for farmers if its imposition is designed to address land speculation.

Otago-based rural sector tax advisor Tony Marshall says there are ways a CGT could be implemented that would negate the deep-rooted hostility – such as making it apply to everything but at a very low (5%) rate. This might end up being twice the rate of commission you’d pay to a real estate agent to sell your house – something people should be able to live with.

However, he says if the Government was to pursue a CGT along the lines of the

TWG recommendations, there are reasons why farmers might feel disproportionately targeted, particularly when trying to develop family succession plans. If no rollover relief is given (as it is in some other jurisdictions – see Canada and Ireland) then it could make it harder to retain farms within families.

As was evident when the TWG recommendations were operationalised by the Government to provide a practical case for implementation in the last term of Government, lobbying for exemptions took on a heightened level of importance.

Given the complicated and idiosyncratic way CGT has been applied in other countries, that is likely to continue being the case if discussions continue.

If CGT does elude the bravest politicians, it doesn’t mean taxing capital gains is dead though – if nothing else than for the demographic reasons identified above. So in an effort to get ahead of the predicted tipping point, what might farmers pay lip service to, if some kind of tax on capital gain is inevitable?

Andrew Coleman suggests an urban land tax is a potential alternative to CGT. And despite wholesale opposition to land taxes to date, it might be one farmers could happily live with.

Blanket land taxes have so far been dismissed as a blunt tool but Coleman says a distinct urban land tax would make sense.

“One of the problems with taxing rural land is that a lot of the land value reflects the value added by farmers themselves (fencing, drainage, improving pastures and so on). You might want to tax the income that arises from the value added to the land, but not necessarily to the

Otago University tax policy lecturer Andrew Coleman.

Otago-based rural sector tax advisor Tony Marshall.

land itself. By contrast, most of the added value to urban land is derived from what other people do – councils creating new amenities, improvements that neighbours make to the neighbourhood.

“This land represents a much better tax opportunity as the value does not reflect anything that individual landowners are doing. They may well be adding value to a house, but not the land component.”

It might sound far-fetched, but we’ve entered an era where far-fetched is becoming yesterday’s plausible. Even, possibly, for tax policy.

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17

INSIGHT

UPFRONT MARKET VIEW

Dairy in good spirits before Christmas Words by: Amy Castleton

D

18

Dairy commodity prices 7000

US$/tonne

airy commodity prices saw a good bounce at the beginning of December, with the Global Dairy Trade price index increasing 4.3%.

In early December, milk powder prices were roughly where they were prepandemic, but milk fat prices were still lower than they were in January/February.

Milk fat prices are also under the five-year average – butter is under the five-year average by about US$500/t and anhydrous milkfat by roughly US$850/t. However, this does include the period of time when milk fat prices were very high. Prices of around US$4000/t for butter and just over US$4100/t for AMF are not exactly low prices for the commodities, particularly considering the global food service sector is still not operating at full capacity and consumer demand remains uncertain.

Expectations at the time of writing are that commodity prices will stay roughly where they currently are for the next several months. Forward curves on the NZX Dairy Derivatives market are quite flat.

Whole milk powder (WMP) prices were sitting around US$3200/t in early December – just under where they were in December 2019, but well within the range of WMP prices pre-pandemic. Demand for WMP has been reasonably solid, particularly from China. Chinese buying was higher than usual late in the year. This appears to be buyers keeping supply chains stocked to ensure they have product on hand. Whether the demand will last into 2021 is the question, but at this stage there isn’t any indication of demand from China faltering.

Sentiment has been good recently. The news of Covid-19 vaccines becoming available has seen buyers become more confident.

The strength of commodity prices has given Fonterra some confidence in adjusting its milk price forecast. Fonterra

6000 5000 4000 3000 2000 1000 Sep 18

Mar 19

Sep 19

WMP

SMP

has lifted the bottom end of its forecast range to $6.70/kg MS. With the upper end maintained at $7.30/kg MS, this puts the new midpoint at $7/kg MS. At the time of writing the NZX forecast was sitting at $7.28/kg MS, right at the top end of Fonterra’s range. The NZX model is based on GDT prices for dairy commodities to date and the forward curve for dairy commodity futures on the NZX Dairy Derivatives market for the remainder of the season. The forecast therefore assumes relatively flat commodity prices at roughly current levels for the remainder of the season. Such a flat forward curve is fairly unlikely – the dairy market is typically not that steady!

However, a farmgate milk price of around

Mar 20 AMF

Sep 20

Butter

$7/kg MS certainly looks achievable this season.

Pasture conditions and New Zealand milk production also look to be turning around. Drought was looking pretty likely back in October/early November, with soils around much of the country much drier than usual. Pasture growth conditions dropped well below their average. By December everywhere had received some much-needed rainfall and pasture growth looks to be back on track for the time of year. There are some concerns with pasture quality that may affect milk supplies as we head through summer.

• Amy Castleton, senior dairy analyst at NZX Agri.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

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GLOBAL DAIRY UNITED KINGDOM

Clues to UK dairy future slowly emerge Widespread disruption is expected post-Brexit. Tim Price outlines what the future may hold for trade.

L

ast year, maverick MP Boris Johnson won a snap UK election, promising ‘an oven-ready’ EU free trade deal.

We’re still waiting for service as the clock ticks down to January 1 when we leave the cosy protection of Europe and attempt to stand on our two feet.

As Dairy Exporter went to press, talks to agree a post-Brexit deal with the EU were deadlocked. Without this, World Trade Organisation rules come into play, with disruption to supply chains and sharp price increases for dairy products expected as tariffs are applied.

While British, French and German cooks argue about the main course, the signing of the UK Agriculture Bill means we have, finally, been served some tasty hors d’oeuvres after four years of chaos.

Casting aside the generous support and labyrinthine rules of the EU, the UK is moving towards payments for environmental improvements, under a still-vague system known as ELMS – Environmental Land Management Schemes. Promoted as ‘public money for public goods’, it focuses on environmental protection, sustainability, low emissions, and high animal welfare standards.

Food is also briefly mentioned in the new legislation, with a commitment to its high-quality production squeezed in at the insistence of the farming unions.

Unsurprisingly, the system announced in the Agriculture Bill will bring a whole new raft of bureaucracy.

While the new framework commits UK farmers to high environmental and welfare standards, desperate attempts to woo Trump into a favourable US/UK trade deal leaves a glaring gap in the rules, allowing 20

Investing in UK dairy: Robert Morris-Eyton with wife Rowena and son Patrick.

the importation of food produced under lower standards.

Massive protests against a glut of US chlorine-washed chicken, and antibioticheavy beef in British supermarkets have failed to overturn this. Ironically, US President-Elect Biden shows little interest in a UK/US trade deal.

Ongoing machinations for an EU deal dominate headlines, but behind the scenes, new agreements are quietly being put in place with other countries. The stakes are high for existing and potential exporters: in the year to September, the

UK imported food and drink to the tune of NZ$91billion.

Negotiations with New Zealand are claimed to be progressing well, with more trade deal talks due in January 2021. Broad agreement has been reached on initial market access offers, rules of origin and simplified customs rules.

INVESTING IN DAIRY

After four years second-guessing the future of the dairy sector following the BREXIT vote, a number of bold farmers are putting serious money into new dairy units.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

“Milking is enjoyable, relaxed and easy on both the cows and milkers.“

Beckside Farm’s new Waikato parlour means one person can milk 200 cows an hour.

“We are confident in the future of milk and wanted to create a facility that would not only improve efficiencies and deliver higher levels of staff and cow welfare, but also have a positive environmental impact.”

At Beckside Farm in the North West of England, an ultra-modern dairy designed to meet future emissions standards has just come on stream.

The 600-acre farm is run by Robert Morris-Eyton and his family. Historically a mixed farm, recently it has focused on dairy, with their herd of 250 cows producing 2.5 million litres of milk a year. This quantity has now doubled.

“When my son Patrick became a partner in the farm in 2017 we did an appraisal of the business and it was clear that our dairy operation was most resilient and had the most potential for growth,” said Robert.

After considering all options, they built a state-of-the-art milking facility on a four-acre (1.6ha) greenfield site.

“We are confident in the future of milk and wanted to create a facility that would not only improve efficiencies and deliver higher levels of staff and cow welfare, but also have a positive environmental impact.”

Beckside’s expanded herd has moved into the new 54-point high specification Waikato rotary parlour and 350-stall cubicle shed. The benefits are already clear, with milking time halved, production doubled and mastitis cases dropping.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

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21

BUSINESS WEST COAST

Frano Volckman, Karamea dairy farmer.

Cash flows following Yili purchase Words and photos by: Anne Hardie

A

year can make a big difference in dairying, especially on the West Coast where a lump sum for shares and a healthy payout has kickstarted the industry and lifted the mood among farmers.

When Chinese dairy giant Yili bought their flailing co-operative, farmers had gone through years of low payout, leaving little money to spend on debt and infrastructure. They lost their co-operative when they voted to sell Westland Milk Products to Yili, but it was an opportunity they couldn’t refuse. A generous share payout of $3.41 per share and a guarantee to match or better Fonterra’s payout for 10 years was a life saver for many.

Today, they have reduced debt, have 22

money in their pockets and are spending on infrastructure that has needed upgrading for so long. Last year was a good first year under Yili ownership because the payout was so good.

Frano Volckman is a Karamea dairy farmer and chairs Westland’s supplier committee who says West Coast farmers are in a better financial position and have cash flow that has enabled them to simply enjoy farming again.

Like many West Coast dairy farmers, Frano and his wife, Kylie, used the share payout to pay off farm debt as volatile payouts from Westland over a number of years had led to banks wanting more security in the industry.

Psychologically, the Yili financial boost has had a huge positive effect on West Coast farmers and in general he says

people are “pretty happy now”.

“Before, it was tough and frustrating – demoralising seeing farmers in other regions getting more. We had an underperforming dairy factory and a limited amount of light at the end of the tunnel and it became clearer and clearer that the writing was on the wall and something had to change.

“It would be nice to be a co-op and doing well, but the reality was it wasn’t doing well. Now we’re seeing the returns on the work we’re putting in and that makes people happy. When you’re getting a decent payout for the product you’re producing, it’s better for your mental health.”

Ten years’ guaranteed payout on par with Fonterra finally puts West Coast farmers on an even playing field and he says that will

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

Shari Ferguson.

“More wanting out than wanting in.”

hopefully encourage buyers to the region who have been sadly missing in recent years. Land prices are lower than other regions and he says there’s opportunities to make a good return on investment now the region has a decent payout.

It’s not happening yet though and despite the higher payout, farmers eager to sell up and retire are still struggling to find buyers. Shari Ferguson from PGG Wrightson Real Estate says that’s been a battle around the country, but on the Coast there’s the added challenge of vendors wanting prices of a few years back. Back then a typical dairy farm on the Coast could fetch around $25,000/ ha, but the few sales in recent times have been below $20,000/ha.

“There’s a lot of retiring guys wanting to sell, but they aren’t willing to accept the new level of pricing and are waiting to see if it rises. Only time will tell us that, and in the meantime there’s more wanting out than wanting in.”

While those looking forward to retirement are now making money from Westland’s higher payouts, Shari says they are also wary of more regulations being imposed by the Government and are keen to let a younger generation tackle the new challenges.

Though in a Covid-19 environment, those retiring wannabes are wondering what they would do with the money from the sale of the farm if they did sell.

“With Covid, they may not put their farm on the market because what would they do with their money? Perhaps it is better left in the farm.”

The West Coast property season tends to be late summer because spring is invariably wet, so she says that period will reveal how many farmers decide to put farms on the market, their

expectations and what buyers will pay for them.

Many potential buyers have been limited by some banks’ appetite to lend, she says. That means buyers usually have to be low-risk to the bank and have 50% deposit, which limits sharemilkers who have traditionally been in the buyer mix for cheaper farms.

She is beginning to get inquiries from investors though, who are finding they aren’t getting great returns on their usual investment avenues and are looking at other options.

DairyNZ consultant Angela Leslie agrees most banks have a more stringent criteria for lending now than they did in the past, especially those with high exposure to agri. But there are also a couple of banks looking for clients, especially motivated buyers with money behind them.

She says one of the problems for those farmers wanting to retire but unable to sell, is finding staff with the skill level to run the farm so they can at least step back from the day-to-day physicality of the business.

While farmers on the Coast now have more cash in their pockets, she says the lack of farm sales has held back equity growth and that has been holding everything back. And though West Coast farmers are now getting payouts on par with their counterparts around the country, their focus – like their counterparts – is now on the environmental regulations.

“They’ve got money in their pocket after five years of poor payouts, so a lot of years of deferred maintenance and lime to catch up on. The spotlight is changing.

The sentiments I’ve come across is the new regulations coming in are causing people distress.”

However she points to the positives in the new regulations, where research strongly correlates that by improving environmental metrics, farmers can benefit from improved profitability. She says being more efficient with feed and reducing N surplus will have a positive impact on the bottom line.

“The practical implications feel like they outweigh the positives right now because we’re stuck in the ‘how the hell are we going to do this’. But there will be some positives.”

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

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23

Ten years’ guaranteed payout on par with Fonterra finally puts West Coast farmers on an even playing field.

‘Before, it was tough and frustrating – demoralising seeing farmers in other regions getting more. We had an underperforming dairy factory and a limited amount of light at the end of the tunnel and it became clearer and clearer that the writing was on the wall and something had to change.’

24

DairyNZ’s Step Change project is focused on helping farmers with resources and support to help lift profit while contributing to better water quality and reducing greenhouse gas emissions. It recently held workshops along with AgResearch on the Coast and discussed West-Coast-specific onfarm data and modelled potential scenarios for change and she says it is an ongoing project specific to the region.

Importantly though, it’s about ensuring their farming practices today are not impacting on the environment in the future, she says.

“Our waterways are generally very good here on the Coast, but we don’t know what the impacts of our practices will be on them in 20-years’ time. Some parts of the Coast are already being impacted by a changing climate. There are increasing instances of facial eczema occurring which suggests weather and pasture conditions have changed to support this challenge.”

She sees the new environmental regulations as another step in moving forward and higher payouts under Yili ownership will help West Coast farmers take that step.

In the meantime, farmers are spending

on infrastructure, often upgrading their dairies and a rare new dairy has been built.

It’s the first new dairy Westland Dairy Sheds has built in the region for years and co-owner Christine Mahuika says it has been part of a busy year for the Hokitika business.

“For the last three to four years there hasn’t been much done at all – just the necessary maintenance. Now people are feeling a lot better about things and there’s a lot more maintenance happening.”

That includes plant upgrades such as automatic teat sprays and cup removers with the latter helping to reduce labour in the dairy which has been an ongoing issue, she says. In their own business, they struggled to find more staff and many farmers are still short of staff.

While farmers are spending money on infrastructure, Yili has been investing tens of millions of dollars in the business to produce better quality products, while focusing on efficiency and quality.

Westland’s general manager for shareholder services, Tony Wright, says Yili has also installed numerous new vats on farms that needed upgrading. Between Yili’s investments in the region and farmers spending a higher payout, he says money

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

is flowing into the local economy.

“Farmers know they can spend the money because the payout is going to be there. Last year was a good year to be a first year because the payout was so good.”

Eighty-five percent of Westland’s forecast payout is paid in advance, with the final payment for the 2019-20 season paid on October 1, coinciding with the first payment for the 2020-21 season.

Looking ahead, Frano says he is confident the West Coast has a good future in dairy farming under Yili’s ownership and he gets the feeling that positivity is shared by other farmers.

“We have confidence Yili is here for a very long time. We just want to try and support them and supply the product they need to do a good job. If they are doing well, then hopefully we are doing well.”

The 10-year guarantee to match or better Fonterra’s payout is not something he dwells on because no business can guarantee where it will be 10 years down the track. One of the tasks for the suppliers’

Angela Leslie.

committee is to work with Westland to develop a long-term plan that fits with Yili’s vision. The 10-year figure does worry some farmers though, he admits.

“Some farmers are worried about what happens after 10 years. But a lot of businesses (outside dairying) don’t know where they will be after 10 years and all things are pointing that Yili wants to be here for the long haul.”

Right now, he says farmers are keen on consolidating their farming business

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

rather than expanding; ensuring they have a solid farming operation that meets environmental requirements going into the future and making the most of the guaranteed payment for the next nine years.

Until Yili, financial stress was the towering problem on the Coast, but now he echoes concerns that the inability of an ageing farming population to retire is the region’s biggest issue.

“There needs to be innovative ways for farm succession. There’s not a lot of young people moving to the next step of farm ownership and I think there could be a win-win for everyone if farmers explored different equity partnerships or share options. That would let farmers step back with skin in the game, but without the grind of everyday farming.”

In their own farming business, they are in an equity partnership with family that bought a beef farm and converted it to dairy and he says it’s a setup that works well for them.

25

BUSINESS LENDING

Flexibility needed Words by: Jeremy Bekhuis

T

he landscape for growing in the dairy industry is changing.

Banks are more restrictive on lending to contract milkers and sharemilkers than they were two years ago.

To save disappointment, borrowers need to be more prepared and farm owners need to be open to different types of contracts that minimise the requirement for bank support.

Gone are the days where you can turn up to a bank with a signed contract milking or lower order sharemilking agreement and expect an unsecured overdraft facility.

The Banks (for all the right reasons) expect to see some financial acumen, minimum outside debt (hire purchases or credit card debt) and some skin in the game by the borrower.

As a firm we usually have about 30 startup contract milkers a year. Three seasons ago, only one out of the 30 new contract milkers were declined finance.

However in the 2020 season, we only had six that were approved finance. We are now the gatekeepers for the bank and are often negotiating contract variations with the farm owner on our client’s behalf.

Traditionally contract milkers don’t receive any income over the winter months until they start producing milk, however they incur costs over the winter months mainly in capital purchases, wages, drawings and other farm running costs such as vehicles, shed expenses and power. Often this means they will require an overdraft facility from June until December or January. If they started with 26

nothing, this could be between $50,000 and $100,000.

More frequently we are now seeing contracts that offer variations of payments over the winter months. This avoids or reduces the requirement of an overdraft facility from the Bank. These are set up as advances or loans, hybrid contracts or smooth payment options.

ADVANCES/LOAN

The farm owner advances funds to the contract milker over the winter, these funds are then repaid as cashflow allows.

Payments are treated as loans rather than part of the contract and don’t affect tax or have any GST implications.

HYBRID CONTRACTS

The hybrid contract is a combination of a contract milking and lower order sharemilking agreement. The contract milker receives a set amount per month to cover expenses, usually a set agreed figure from the farm owner (say $0.75/kg MS of targeted production) and also receives a small percentage of the milk payment, say 7.5-8.5%, this percentage is generally paid directly from the dairy company.

SMOOTH PAYMENT

The smooth payment option pays between 80-90% of the targeted production evenly over the 12 months at the contract rate.

The final 10-20% of production also known as the wash-up payment is paid in June of the following season. By only paying 80% of the contract this avoids the contract milker being overpaid in the event that there was a major event and ending up

owing the farm owner.

We are often finding the farm owner pushing back and questioning why they would do one of the above options, not seeing it as their obligation, which is fair enough. However they need to be flexible in the current environment to ensure they manage to secure the best candidate for their farm. After all, these are the people running their multi-million dollar investment.

Another consideration we are seeing in the more traditional lower order sharemilking agreements is the introduction of a floor in the contract. This is usually set about the $5 mark – let’s say at 20% of the milk cheque the floor would be $1.00/kg MS. This takes any payout reduction risk away from the sharemilker, and enables the sharemilker to at least have some money in a low payout for their living costs. In the 2016 season when the payout was $3.90, at 20% of the milk payment the sharemilker received 78c/ kg MS. Our average cost structure in that season was 76c/kg MS, which resulted in a break even season, however they had no surplus to be able to live off or grow over that period. Some of our lower order sharemilkers in the lower payouts were losing over $100,000.

We are still seeing the flow on effect of the lower payout years on the farmers that were lower order sharemilking. Through no fault of their own, excellent farmers were left with debt, which they are just getting on top of now and in some circumstances they left the industry.

Contract milkers and sharemilkers are the future of the farming industry. Good farm owners realise that for the right people, they are willing to give more away. This pays them back with loyalty, reputation and ultimately in the back pocket. Our most profitable farm owners have consistency of staff and/or contract milkers/sharemilkers. Not every farm owner has the balance sheet to give more away, which is fine, however by offering flexible contracts, this is one way to support the future of the industry.

• Jeremy Bekhuis is a partner at Agrifocus who are accountants and farm financial advisors, based in Southland and Otago.

• First published in Country-Wide January 2021.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

BUSINESS CO DIARY

Have your employment agreement in check

It is best that both parties sit down together and go through the document step b -step. This provides an opportunity to discuss the details of the document, including annual leave and remuneration, so there are no surprises for either party.

Having these conversations early on also helps build a good relationship from the start.

DON’T BE AFRAID TO GET ADVICE You are fully within your rights to ask questions and seek advice before signing an employment agreement. If you go through the document and don’t understand parts of it you can get advice from family members, past employers,

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SIT DOWN AND CHAT

The PETA Zinc Dispenser nser dispense zinc sulphatee in

Words by: Abby Scott, DairyNZ Wairarapa/ Tararua consulting officer. tarting a new job can often feel like a fresh start. You might be excited by the opportunity of starting in the dairy sector or taking your next career steps.

Starting a new job also comes with some legal requirements, particularly employment agreements. I often hear employees are unsure of their rights or where to start in a new job.

Employment agreements are a legal requirement The most important aspect is that employment agreements are legal documents. An employment agreement sets out the rules of the working relationship between the employee and the farm owner/manager (the employer).

It explains each party’s rights and responsibilities, what is expected, and it can protect both parties if things do not work out.

If you are currently working and haven’t received an employment agreement yet, it isn’t too late. You should ask your employer for one, as they are required to provide one.

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Abby Scott, DairyNZ Wairarapa/Tararua consulting officer.

mentors, and rural professionals.

Services such as the Rural Employee Support Hub (resh.co.nz or 0800 694 121) and Employment New Zealand are available to provide advice and information.

Purchase a PETA TA m your Dispenser from plies local rural supplies narian. store or veterinarian.

ALL EMPLOYEES NEED ONE

Whether you are permanently employed (full or part-time) or casual, you must be given a written employment agreement.

This includes people like relief workers who are only on the farm occasionally (casually) or for a set period.

No matter what type of employment you have, every employee is entitled to basic minimum employment standards, including minimum wage and annual leave.

A NOTE FOR EMPLOYERS

Federated Farmers has farm-specific employment agreements that many farmers find very efficient and easy to use.

Another idea is to use an outside party such as a private consultant to help with the process; this may have an associated cost but is worth it in the long term.

• For more information visit www.dairynz. co.nz/employmentagreements

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

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www.peta.co.nz Other dispensers in the range: • Multi: 24hr & 48hr • Bloat: 12hr & 24hr Other dispensers in the range: 27 • Multi: 24hr & 48hr • Bloat: 12hr & 24hr

BUSINESS CASH FLOW

Nigel McWilliam.

Fixing milk price Words by: Anne Lee

W

ith Global DairyTrade prices on the rise through the back-end of 2020 farmers could be forgiven for thinking earlier moves to lock in a portion of their milk price may have been folly rather than fortune.

But Waikato-based MBS Advisors director Nigel McWilliam, from Morrinsville, says milk price risk management isn’t about trying to beat the market it’s about having a downside protection tool.

Nigel talked about the fundamentals of milk price fixing on a Smaller Milk and Supply Herds (SMASH) webinar in December along with Fonterra innovation manager Satwant Singh.

He says a fixed milk price contract is an agreement between a buyer and a seller on the delivery of a product at an agreed date in the future where the price is agreed today.

It effectively takes 15 months for farmers to receive full payment for their milk and volatility in milk price even within seasons can make planning and running a wellmanaged, profitable business tough.

As a shareholder in a South Island dairy farm, he says he too felt the pain price volatility can bring when early season forecasts had been for north of $7 but ended up at $3.90/kg milksolids (MS).

So many things can affect milk price 28

over the 15-month period that even wellinformed market participants don’t see coming.

Demand fluctuation, climate risk onfarm, currency volatility, changes in world milk production, trade restrictions or geo-political instability not to mention a global pandemic.

Using tools such as Fonterra’s Fixed Milk Price or NZX’s Milk Price Futures enables farmers to lock in a portion of their milk at a price that protects the farming business.

Fonterra’s Fixed Milk Price is a good entry tool and a way to develop an understanding of how price risk management works while the NZX product is a little more complex but can be more flexible.

Seeking tailored advice for your specific situation is a must, he says.

Satwant says Fonterra’s Fixed Milk Price has been designed so that the farmer-facing tool is quite simple.

Farmers have 10 opportunities throughout the year to fix the price for up to 50% of their milk with milk price fixing events carried out online in each month from March through to December.

The price offered at each event is based on the average of the daily settlement price of the NZX Milk Price Futures contract for three days following the first GDT auction of the month.

Fonterra has a set percentage of the total milk supply available so if there’s strong

demand from farmers they may not be able to fix the full amount they apply for.

A 10c/kg MS service fee is charged to cover trading costs.

Satwant says to participate farmers must have the correct login details from Fonterra and be a farm owner.

Checklists and key considerations are posted on the website but farmers should also do their homework and seek advice from their financial advisors, she says.

Nigel says that advice should include understanding the tax implications.

Given it’s a known contract as defined under the Tax Act - so you know what you are going to get in terms of expected income – there will be implications for bringing retro payments into the current financial year, he says.

Farmers should take a considered approach to managing their income rather than going for the default and waiting for the milk cheque to come in.

“If you choose not to participate and manage milk price risk once you’ve considered the options then that’s an active strategy in itself,” he says.

The first step no matter what direction though is to establish your breakeven milk price.

As an example: Farm working expenses $3.40 Grazing $0.40 Labour and wages of management $1.00 Debt servicing $1.50 Tax $0.10 Drawings $0.50 Total $6.90 Minus Stock sales $0.50 Dividend $0.05 Breakeven milk price $6.35 So, $6.35 is the milk price the farm must achieve and the number used when determining a milk price risk management strategy, he says.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

THE THREE STRATEGIES: Continuous hedging Table one shows a continuous hedge example for a farm producing 100,000kg MS until November.

Fonterra’s Fix Milk Price rules would allow 50,000kg MS to be fixed and in a continuous hedge situation through to December with the aim to try and fix 5000kg MS at each of the 10 opportunities.

In this example because of demand the farmer didn’t get their full allocation but by November did manage to lock in 30,700kg at a net average price across each trade of $6.37/kg MS – once the 10c/kg MS fee is included.

“They’ve locked in 31% of production at breakeven – thinking of it that way takes the regret thing off the table,” Nigel says.

Profit margin trading The aim with profit margin trading is to look back over a set historical period to establish a favourable price based on the range and then set triggers in price where you lock in a percentage of production.

From 2013/14 to 2019/20 milk price ranged from $3.90 to $8.40 but $6.14/kg MS was the average.

With $6.35/kg MS the breakeven a series of triggers may be set as listed in table two – at $6.30 you lock in 30% of production with the percentage increasing as the higher offer price triggers are reached.

If the offer price was $7.50/kg MS, for instance, this example farmer’s policy calls for locking in the full 50% of production.

A crash floor price is also set into the policy and in the example farmer’s policy that’s $6/kg MS and at that point they’ll lock in as much as they can at 50% as well.

They know the business can’t withstand another $3.90/kg MS milk price so they lock in as much as they can at $6/kg MS to limit the loss.

Targeting expenses This involves picking the larger expenses and locking in a price to cover those, Nigel says.

In table three the two expenses chosen are feed, at 90c/kg MS and debt servicing, at $1/kg MS. To cover that the farmer needs to lock in 28,250kg MS at an offer price of $6.83/kg MS and net price of $6.73/kg MS. “Then I would be trying to better those feed and debt servicing costs to create a better margin,” he says.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

(i) Continuous Hedging

TABLE 1: CONTINUOUS HEDGING

(ii)Profit Margin Trading

TABLE 2: PROFIT MARGIN TRADING

Current Fixed Milk Price Policy 2020.21 Hedge

Crash Floor

Actual

• Lock in a favourable price based on milk price history.

• Have a range trigger • Have a crash floor price

$ $ $ $ $

7.50 7.10 6.70 6.30 6.00

100% 50% 40% 30% 50%

2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20

$ $ $ $ $ $ $

8.40 4.40 3.90 6.12 6.69 6.35 7.14

AVERAGE

$

6.14

(iii)Targeting Expenses

TABLE 3: TARGETING EXPENSES

Lock in a price to cover budgeted large expenses Then work on lowering the actual cost to a create margin

• Nigel McWilliam is a chartered accountant and director of MBS Advisors based in Morrinsville. He is not a financial advisor and his views shared on the webinar and in this story are his opinions not personalised advice.

29

SYSTEMS FORAGES

Grant Rennie, AgResearch scientist explaining the trial plan to explore the potential of bananas as a forage crop for livestock.

Exploring the potential of bananas Words and photos by: Chris Neill

G

raeme and Carol Edwards continue to make clear choices about where they live and the business they operate.

Their 240-hectare farm, of which 125 is effective pasture is surrounded by steep hill with both native and exotic forest cover, located at the north western extremity of a traditional mid-Northland dairy district, providing a relatively low investment base to achieve their primary KPI of return on asset. The other key ingredient to achieving this is a simple, low-cost farming system.

30

The Opouteke River which is highly rated for biodiversity bisects their farm and has large, mature riparian margins and plants.

To maintain compliance and prepare for harvesting their own pine plantation, the river needed to be bridged. The siting of this led to a new 26-aside herringbone cowshed and associated dairy effluent system, effectively changing the whole farm configuration. It is a farm development investment that made economic and environmental sense.

Milking 250 high BW (167/55) and PW (198/64) cows once a day for the whole season, has produced about 70,000kg

milksolids (MS) annually for the past five years. Predominantly a kikuyu farm with most of the farm undersown with annual rye to cover the shoulders of slow growth, and around 5% in turnip crop the cows are harvesting around 7.5 tonnes drymatter (DM)/ha.

Nitrogen is usually applied in spring and late autumn at 100kg/ha. Silage is harvested when surplus pasture is available and palm kernel is used strategically averaging 150kg DM/cow. Recent changes in weather patterns have placed greater reliance on the use of silage, crop and as a last resort palm kernel through summer.

In keeping with Carol and Graeme’s low-

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

programme of short gestation Hereford across the bottom of the herd. To ensure high ongoing genetic merit of replacement dairy heifers and to maximise the number and value of beef calves born they are targeting a calf crop with 29% replacements, 12% Wagyu, 35% Hereford and 24% bobby. To achieve this, their mating plan with a PMS (Planned Start of Mating) of 7 October is: October 7 to October 22 (16 days) • Sexed semen to cows of BW>167 (approximately 60% of herd) • Wagyu to bottom 40% that are 5 parts Friesian or more (approximately 15%) • Remainder to short gestation Hereford (approximately bottom 15%)

The banana plantation adjoining the green water pond from which it is irrigated.

cost philosophy, farm working expenses for the past three years have been $4.01, $4.01 and $3.66/kg MS. This includes the cost of a farm manager plus calf rearer and relief milker.

Graeme and Carol have established a Jersey dominant herd that is genetically

rated in the top 4% for BW and want to maintain this. They also want to reduce the number of bobby calves sold from the farm and increase the value of dairy beef sales from an additional 150ha property recently purchased as a run-off and dry stock unit.

The business has been using a simple

October 23 to November 12 (21 days) • Premier sire Jersey to BW>195 (approximately 30%) • Remainder to short gestation Hereford November 13 - bull out

Low rate effluent irriga�on made easy.

Even nutrient applica�on with automated irrigator speed control and hydraulic winch system. Even spread from 50m – 100m ACCURATE | DURABLE | USER FRIENDLY | EFFICIENT

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

31

Their plan is based on the herd’s high genetic merit and confidence that cows and heifers will be in the appropriate body condition to have a high in-calf rate.

The December SMASH (Small Milk and Supply Herds) field day held on Graeme and Carol’s farm attracted attention for their dairy enterprise and diversification into bananas. Encouraged by their son, Dr Paul Edwards, a scientist with DairyNZ, bananas were introduced for their ability to grow in Northland and high demand for nitrogen and potassium. Paul’s calculations indicated that all the farm’s effluent could be absorbed by planting 4% of the farm, 5ha in bananas. A new weeping wall effluent system was installed with the new cowshed. This separates the solids which can be applied to crop paddocks from the high N and K green water which could be drip irrigated to the bananas.

Misi Luki variety were selected for their hardiness and disease resistance and 60 stems were planted in November 2018.

The initial plan was to grow bananas for human consumption. A reality check around the demands this would place on them to manage and harvest the crop then access a market for their product saw a change in plan.

The bananas continue to thrive and absorb effluent while an AgResearch project led by Grant Rennie started in September 2020 to evaluate options for managing bananas to produce forage.

The crop has been planted at a density for fruit production. Expectations are that each plant will produce 10kg DM/yr. At planting density of 1600 plants/ha the estimates the standing drymatter at 16t DM/ha/yr and 20t DM/ha/yr at a density of 2000 plants/ha. With the effluent water irrigation, the trial will test if the plants will absorb the nutrients applied.

Cutting trials are looking at the volume of forage that can be harvested and the management of banana plants to produce leaf and stem. The drymatter content and nutritional values differ significantly between leaf and stem so like a giant grass plant, finding management techniques to optimise growth are essential to achieving yields of 7t to 8t DM/ha.

The nutritive qualities identified so far when compared to other available feed on farm are summarised as shown in Table 1.

These results were unexpected but in the 32

Left: Carol Edwards, who recognised that commercial banana growing presented a workload that was beyond them. Below: Graeme explaining the virtues of a weeping wall system.

TABLE 1

BANANA LEAF

BANANA STEM

Crude Protein

Low compared with summer pasture

Very Low compared with maize silage

NDF fibre

Low compared with spring pasture

Low compared with turnip bulb

Soluble sugars

Moderate compared with pasture

High compared with maize silage

true form of science more questions are raised: • What does low crude protein mean for N uptake from effluent?

• What are the soluble sugars and starch – do they have other properties?

• What proportion of NDF is effective – will it promote rumination through being long and stringy?

Graeme and Carol encouraged by their son Paul are comfortable to invest

in development on their farm. They are a combination of science curiosity and discipline, practical sensibility, understanding of sustainable business and awareness of people’s capacity. The farm has the capacity and flexibility to support testing new ideas that will hopefully benefit their business and may also provide information that other farmers can adopt to find opportunities in the challenges of ongoing change.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

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*Compared to DeLaval Harmony clusters with round liners, under the same conditions and settings on pilot farms. Results may vary and are not guaranteed.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

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33

SYSTEMS E350

Farming’s new generation leaders A team of young Northland farmers have shown off the results of their experience with the E350 project. Chris Neill reports.

N

orthland’s Extension 350 project attracted young and old to its first dairy cluster when it started in June 2017.

The experience of these four farmers in the project ended in May 2020 amid the legacy of drought and Covid-19.

At a December field day, with admissions of initial reluctance and scepticism, Graham and Kylie Beatty, Peter and Sue Skelton, Lachie McLean and Leroy and Kirsty Jurisich noted achievements of goals they thought aspirational and the critical importance of consistently completing the basics.

They all recognised the contribution of their mentors and the management team that supported them to make and sustain change - their team of trusted advisers who will hopefully remain connected beyond the project.

Leroy and Kirsty Jurisich with their recently-born son Jack hosted the day and shared greater detail on their experience and outcomes.

Their farmer mentor Danny Woodcock, farm consultant Tafi Manjala and product specialist Corey Thorn were in their management team that has supported the success story.

Leroy and Kirsty were keen and active from the very start, consistently delivering on the actions they had agreed with the management team to complete.

This in turn fuelled the enthusiasm of the management team to help Leroy and Kirsty push harder and faster toward achieving their vision and goals.

Danny kept encouraging them to focus on the long-term things that can make a 34

The faces of Northland’s dairy farming future: Leroy, Kirsty and Jack Jurisich.

Danny kept encouraging them to focus on the longterm things that can make a difference to achieving their goals and to minimise those day to day activities that can limit the ability of the land to produce. difference to achieving their goals and to minimise those day to day activities that can limit the ability of the land to produce.

Their vision and goals as 50:50 sharemilkers were laid out in their planning wheel.

It recognised the key areas of focus as (i) purchasing land, (ii) lifting pasture eaten to 10 tonnes drymatter (DM)/ha, (iii) producing 70,000kg milksolids (MS) with

a once-a-day herd, (iv) meeting the farm’s environmental compliance requirements, (v) lifting P/W and B/W, and (vi) having a good work / life balance.

Leroy and Kirsty have achieved a compounding equity growth of 31% per year since 2007. In the three years of the project there has been near to $400,000 gain, including acquisition of the land they identified in their goals.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

FARM FACTS:

Top: Leroy describing the additional land they have added to the platform. Above: Lachie McLean describing the highlights of his journey as an E350 target farmer.

Production has lifted from 45,254kg MS in the year prior to the project to 56,583kg MS in their final year, which was challenged by the transition to OAD, drought, floods and introducing the additional land into their business.

Leroy and Kirsty are confident that with these challenges behind them they will be able to lift cow numbers and normalise their business to achieve their 70,000kg MS target.

Farm working expenses are $1.90/kg MS compared to a Northland sharemilker average of $2.70 and they intend to maintain the business at a level they can

operate themselves without permanent labour. They see diversification to include beef alongside dairy as part of their business growth.

A key to low farm working expenses is the increase in pasture eaten which has been lifted from 8t/ha prior to E350 and reaching 9.5t/ha in 2018/19 before hitting the challenges of 2019/20.

The spring rotation planner has been a key tool, combined with a close focus on pasture measurement, recording in the feed wedge and management to utilise pasture as well as possible.

Annual nitrogen use is typically 120kg/

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

50:50 Sharemilkers: Leroy and Kirsty Jurisich Owners: Peter and Val Nelson Location: Waiotira, south west of Whangarei Farm: 100ha milking platform Herd: Currently 212 Kiwicross cows, will increase to a maximum of 250 Production: Targeting 70,000kg MS Milking frequency: TAD to capture peak milk then OAD Calves: 12 week mating with 4 weeks AB Nitrogen: Up to 130kg N/ha/year

ha and only applied when conditions are likely to give a response.

Summer crops and silage help transfer feed across the season and palm kernel of 0.6t/ha is primarily used as a backup to pasture. The target of 10 t/ha pasture looks readily achievable and a key driver of profit.

Northland Regional Council are part funders of E350 and their environmental team were highly supportive of completing Farm Environment Plans for the target farms.

This helped identify the critical areas around effluent, waterway and land 35

management. For Leroy and Kirsty this has allowed them to understand what is required and when so they can schedule work and cost.

They are intent on staying ahead of the game with current and future regulatory and market expectations.

The initial plan to increase P/W and B/W was to buy high BI cows as replacements.

Instead, they focused on improving reproduction rate and using AI to achieve their gains.

Achieving body condition score targets at calving has improved the 6 week-in-calf rate from 61% to 84% over three years.

A focus on achieving growth rate targets for young stock is another key success, contributing to a higher in-calf rate and ability to bring greater selection pressure on the herd.

The value of these changes is calculated to be worth $24,800 over the past three years.

Kirsty and Leroy have a clear focus on the business giving them the life they want. They are committed to OAD farming and have enjoyed showing Danny, a dedicated TAD farmer, how well it works for them.

Planning is a great means to ensure focus is maintained on the critical issues and the basics are attended to.

Their Targets and Trigger Points chart simply and clearly lays out the critical elements of what must be achieved and when. This allows them to be proactive rather than reactive, constantly working to a plan that is manageable.

With planning, scheduled time away from the farm for recreation and relaxation is reality.

Leroy identifies his three top tips for success which all relate to getting the basics right. (i) regularly monitoring body condition score to ensure cows are in a condition appropriate to their annual cycle, (ii) setting goals with the Planning Wheel and regularly checking in on progress as a reminder of what needs to be done and to recognise the achievements that have been made, (iii) measuring pasture to ensure the most cost effective quality and quantity of feed is available when required.

He recognises that getting people you trust involved in their business is a great help to achieving goals and anticipates that without the regular encouragement of the E350 team he will need to keep himself 36

The OAD herd taking advantage of shade.

Danny Woodcock describing the benefits of Leroy and Kirsty’s success in improving their six-week in-calf rate.

The faces of Northland’s dairy farming future.

Danny believes the “knowledge is in the room”, it’s a matter of avoiding distractions, doing the basics right and surrounding yourself with the right people. motivated, with encouragement from Kirsty. E350 connects a group of associate farmers with each target farm. Brad and Jess, Dave, Ben, Joel and Campbell have maintained close contact with Leroy and Kirsty as they have worked through their three years in the project. Farmers learning from farmers is a key element of the project.

The associate team have taken advantage of Leroy and Kirsty’s experience and identify their key learning as; (i) writing down your goals and sticking to them, (ii)

pasture management and feed budgeting are critical to success, (iii) it takes hard work to make the change and get the good outcomes, (iv) Leroy and Kirsty are a real example of how a young couple can apply themselves to achieve their goals.

Danny Woodcock believes the “knowledge is in the room”, it’s a matter of avoiding distractions, doing the basics right and surrounding yourself with the right people.

The E350 target farmers all have stories that endorse this message.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

SPECIAL REPORT MON 5am/3pm

FLEXIBLE MILKING

Less milking, more freedom

TUE 11am

WED 5am/3pm

10 7in

THU

FRI

SUN

5am/3pm

SAT

11am

5am/3pm

11am

OAD 24 REPEAT

05:00 15:00 DAY1

32 IN

11:00 DAY 2

38 Enroute to farm ownership 43 Milking evolution 45 Flexible milking times to attract staff 48 Flexible milking Q&A 49 Udder intervals explained 50 Making the system fit

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

37

SPECIAL REPORT | FLEXIBLE MILKING

EN ROUTE to farm ownership

Varied milking frequencies has been a successful recipe for a Maruia dairy farming couple. Anne Hardie reports.

38

I

n the middle of a lease-to-buy agreement to buy their first farm and juggling work with family, Brian and Hannah Dineen have tried a range of milking frequencies to survive financially, physically and emotionally.

It’s their third season on the Maruia farm in the Top of the South and they’ve milked twice a day (TAD), once a day (OAD), 3in2 and even 10in7 for a short stint. After much experimentation and learning about their new farm, they have settled on milking TAD for the first two months of the season and then 3in2 for the remainder which so far seems to be resulting in more milk from less cows.

Left: Brian and Hannah Dineen on the Maruia Valley farm they are leasing to buy. Top left: Brian in a paddock of new pasture for beef and calves.

Bottom left: Hannah and Mac. Right: Hereford bulls for beef-cross calves.

Brian acknowledges they don’t always follow the conventional route, with some trials working and others not so successful.

He puts it down to the fact neither of them came from a dairying background and tradition doesn’t guide them.

The Irish lad from Limerick was a professional rugby player when he first landed in New Zealand, playing five seasons for Nelson Bays and then a season with the Makos. At the end of his rugby career he trained as a helicopter pilot at a time the Government was paying for training. The unintended consequences of the Government’s input was a surplus of pilots and not enough jobs, so he took up a relief milking job on a dairy farm.

Along the way he met Hannah who grew up on a Canterbury sheep and beef farm and together they looked at a career in dairying, taking on a 2IC job on a 1000cow farm in Canterbury. They’d only been there two years when they decided to “have a crack” at sharemilking. That was a 50:50 sharemilking contract near Tapawera in the Top of the South, in the glory days of $8.40/kg MS. Then the milk payout dropped to $3.90/kg milksolids (MS) and everything turned to custard. With the drop in payout, cow prices plummeted and so did their equity.

From sharemilking, they leased a

05:00 15:00 DAY 1

32 IN IN

11:00 DAY 2

farm for a year and then the opportunity arose to lease the 210ha effective farm on the west bank of the Maruia River. The difference was, they could lease the farm for a period of years and pay lump sums to get themselves into farm ownership. It was too good a chance to miss. They signed up and shifted their reduced herd of 350 cows into the isolated valley.

For the first two years they simply leased the farm and last year they also began payments towards buying the farm by 2023. Buying their first farm has also been made possible by supplying Fonterra’s MyMilk on a five-year contract. That enables them to supply Fonterra without buying shares for a set period, with 5c/ kg MS deducted from their payments that goes toward the shares they will buy at the end of that contract. It also means they can try and clear more debt and put money into the farm that would not have been possible if they had to buy shares straight

away. Brian says the lease-to-buy agreement has suited both themselves and the retiring farm owners Ross and Diane James, with a good symbiotic relationship established between them. They have benefited from invaluable advice about the farm and weather patterns that deliver between 1.6 and 2m of rain a year, then sweltering temperatures through summer.

“The owners have been really gracious to allow us to take over the farm and giving us that opportunity.”

It’s a challenging farm, spread over 3km of river flats merging into rockstrewn hillsides, interspersed with small gullies that channel the high rainfall from surrounding hills. About 170ha makes up the milking platform and the remainder grazes a range of beef-cross cattle bred from the herd, plus carryover cows.

The farm doesn’t have all the bells and whistles of some they have worked on in the past – apart from its rotary dairy which is a godsend for the time-challenged couple - with plenty of work to do on weeds and fences. But Brian says the bones of the farm are good and it has been developed by the previous owners over generations so that their goal to take it to the next level is potentially achievable.

That first year, to put it mildly, was a bit of a nightmare. They brought 350 cows to

39

One relaxed dog.

the farm and they were short of feed from the beginning when the last of them were being unloaded near midnight on Gypsy Day. Despite buying in balage and milking OAD, they ended up with an “horrendous” empty rate that year of 24%. Mating was followed by one of the region’s driest summers on record – conditions that saw a massive wildfire take hold near Nelson.

From 350 cows they produced 88,000kg MS that first year and kept no replacements because they were still paying debt from the $3.90/kg payout.

“The following year we were talking to the bank and they said we really needed to start producing,” Brian remembers.

TRYING FLEXIBLE REGIMES Last season they dropped cow numbers to 280, which was partly due to fewer replacements, and started out on TAD with the intention of keeping that going as long as possible. But between two milkings every day, the workload on the farm with no staff and three kids aged seven to 11, they were struggling through spring. They switched to 3in2 until Christmas and then

40

‘The owners have been really gracious to allow us to take over the farm and giving us that opportunity.’

OAD for the remainder of the season. They had less cows, but more feed and produced 90,000kg MS or 365kg MS/cow.

This season they dropped cow numbers further to 240 which gives them a stocking rate of 1.5 cows/ha on the milking platform (1.8 overall on the farm) so they can better weather any storm thrown at them. They run a grass-only system, with balage made on the farm and only buying in molasses that is fed to the cows in the dairy along with minerals, trace elements and magnesium oxide. The molasses helps with metabolism and Brian says it seems to make everything else more palatable. After reducing to 240 cows, they have decided to lift numbers up to 280 again next season to try and strike the right balance.

“Having less stock means they’ve always got something to eat,” Hannah says. They are not keen on a repeat of their first year on the farm when feed was short.

Though a lack of money dictates a grass-

only system with just molasses bought in, Brian says they wouldn’t change that even if they had money to spend.

“We used palm kernel when we were sharemilking and could see what it could do, but it’s not on our radar because we’re starting off and everything has to be simple. And if you can’t get your grass right, you know you’ve done something wrong.”

Their grass growth in the cold valley has a slow start at the beginning of the season and for that reason – and because they don’t buy in any supplement – they calve late August. This season they began with TAD milking to get the cows producing well for the rest of the season, regardless of what milking frequencies followed. By October, Brian says they had had enough and decided to drop some of the milkings.

“After a month of TAD we woke up nearly in tears and we sat down and said we’re going to burn ourselves out.”

Left: Hereford bulls for beef-cross calves. Above: Clover and chicory in the mix for beef and calves.

Farm facts Lease to buy farmers:

Brian and Hannah Dineen Owners: Ross and Diane James Location: Maruia, south of Murchison, Top of the South Farm: 210 effective hectares including 170ha milking platform Herd: 240 mostly Friesian cows and climbing back to 280 cows Production: 2019-20 season 90,000kg MS from 280 cows.

This season projected 94,000kg MS from 240 cows.

Milking frequency: TAD initially and then 3in2 Milk contract: Fonterra MyMilk five-year contract Inputs: Molasses Calves: No bobbies - Friesian bulls sold at four days old and beef-cross farmed on Nitrogen: 46kg N/ha/year

Initially they tried 10in7 which they had played with for a couple of weeks last season. But when they tried it this season in the middle of October, Brian says the cows let them know very clearly that they didn’t like it.

“They broke out of the paddock in the middle of the night and went to the shed for their afternoon milking and waited for us. We had to milk them at one in the morning and the next day we were knackered.”

They decided their Friesian cows were struggling to adapt to it so didn’t persevere, switching instead to 3in2 which they will continue for the rest of the season, depending on the weather. If it turns dry, they will drop to OAD. They don’t believe TAD milkings are essential nowadays to keep milk production up through the season because genetics have improved so much and they say they are achieving the same production with 3in2.

This season with 240 cows, they hope to produce between 93,000kg MS and 94,000kg MS, or 380kg MS/cow, if the weather plays ball.

“Everyone has their two cents worth on milking but we’re of the opinion we have good genetics in the cows and by having that second milking every second day, it keeps up production. We’re producing

more now on 3in2 than we were on TAD, with less cows. The cows are a lot happier and so are we.”

They’ve included 3in2 milkings into their system for years – rather than the more rigid 16-hour milkings – which for them translates into milking 5am and 3pm one day, followed by 10am the next day.

Then back to 5am the next morning. It gives them time to carry out more work on the farm, more time with the kids, plus more sleep with those later starts every second day.

For them, flexible milking regimes have helped them survive a pretty stressful period. They are rapt to be in the process of buying their first farm and say the lifestyle of living in a pretty spectacular setting with a close rural community is pretty special.

But it ain’t easy.

“It’s not a fairy tale!” Hannah says. “It’s bloody hard. You have to be realistic; the rewards are huge and the lifestyle is amazing, but the work is really hard. But this place is good for the soul and we are very lucky.”

Brian says the support they have had, especially through that first year, has been very humbling.

“You’re dealing with people you can’t always pay on time and it is a humbling time. People were really good to us because they knew we were struggling.”

41

The Dineens milk Friesian cows so they don’t waste calves as bobbies.

BEEFING UP THEIR INCOME Farming beefies adds more to their workload, but also provides that extra income and selling them throughout the year is cashflow for the business.

“The beefies are vital to our survival because we need that little bit more,” Brian says.

They chose Friesian cows years ago for the ability to sell bull calves rather than put them on the bobby truck and those calves head off to buyers at four days old.

After artificial insemination, Hereford and Angus bulls are run with the cows and the resulting calves are reared on the farm and sold either as stores down the track or finished prime. It makes good use of those areas on the farm that are either too distant or difficult for the dairy herd to graze. Throughout the year they run about 150 beef cattle on the farm – this year that includes 100 R1 heifers and steers - plus the 60-70 heifer calf replacements for the herd.

As R1s, those heifer replacements head to a grazier near Nelson and that’s simply because of the extra workload of keeping them at home. Eventually, they hope to become fully self contained.

The herd itself winters off the farm at a support block they lease a few kilometres away. They can walk the cows to the block which is fine while they are on the shingle no-exit road where they live. But then it’s over a bridge and on to the highway for about two kilometres, with flashing lights, kids taking a day off school to help and friends on horseback to move them along.

Because they don’t calve until the end of August, Brian says the cows get a decent break over winter to recuperate and that is playing its part to improve reproduction.

42

Last year it lifted from that first horrendous mating to 14% not-in-calf and this year the cows have cycled well and they are hoping it will be closer to 10%.

ENVIRONMENTAL EXPERIMENTS Despite the workload and financial stresses, they have been making headway on the farm itself. The effluent field has been expanded to cover 55ha, while 50ha of new grass was sown over two years, including a mix of clover, chicory, plantain and yarrow on one of the beef and calves blocks. They’re hoping it will reseed, or may oversow other grasses into it if needed.

They’ve chosen plants such as plantain with a deep root to find nutrients and grab nitrates that may have leached into the soil. Though their low stocking rate and 46kg N/ha/year puts them in a comfortable space environmentally.

“We’re trying to strike a balance and keep everyone happy including ourselves.

We can still increase N under the cap and as we become more efficient with new grasses we may need to put more on.”

Despite already meeting new environmental regulations, they have taken the attitude “lets break the rules and do it better”. Such as sowing Savvy cocksfoot because it has a deep root system and loves nitrogen. They’ve planted 7ha beside the dairy where it is part of the effluent field, with clover to be added later to add bulk. Its close proximity to the dairy also means it can be grazed frequently to keep the quality up. Another benefit of the cocksfoot is that it has proven to be impervious to pests and Hannah says they “have all the pests” on the farm, including porina. Regardless of environmental

and productive attributes, the cows are enjoying the ‘smorgasbord of grasses’ on offer as well and the Dineens will continue to experiment with different species.

One of the next grasses they want to try is fescue as a hardy grass to get through the summer dry. Some environmental regulations will need time and money to achieve the end goal and Hannah says the Government has not allowed for that.

While on the other side of the coin, Brian says he would like to hear the Government tell farmers they are doing a good job once in a while. He’s the sort of guy who will say what’s on his mind and is not adverse to bailing up politicians to tell them what he thinks of their lack of loyalty to farmers.

The Dineens are in the process of creating their farm environmental plan with Fonterra which will be a living document that gives them a base to work on. They are appreciative of the expertise available through Fonterra to guide them and say it is up to farmers to show policy makers the good environmental work they are doing.

“We don’t have much money, so have to rely on as much expertise as we can. As farmers, if we are dealing with policy makers either within Fonterra or Government, we have a role to show them what we are doing.”

Making changes around the environment and milking are all part of an experimental process to find the best solution for the farm they are wanting to make their own.

“There’s the huge enjoyment factor when you get it right,” Brian says.

“Nowadays more than ever, you have to try new ideas.”

SPECIAL REPORT | FLEXIBLE MILKING

Milking EVOLUTION

By Anne Hardie

L

ess than half the national dairy herd is now milked twice-a-day (TAD) throughout the season as farmers evolve their systems to integrate 3in2, once a day (OAD) and more recently, 10in7. Every farm and system is different and FarmWise consultant Brent Boyce says no milking frequency is better than another, but there has been what he calls a seismic shift in the past decade or so, away from traditional choices of TAD and OAD to other options that continue to evolve.

He says the shift has come from farmers being prepared to change their systems to better capture efficiencies of labour, farm logistics and time management.

When 3in2 was developed, it began as 14/16/18-hour milking intervals which was then pushed to 10/18/18 hours and even down to 8/20/20 hours. It still had a serious flaw though because planning became an issue for weekends and staffing rosters. That led to the 10 milkings in seven days (10in7) which was trialled by a number of farmers in the Tasman and Marlborough regions last season.

“My thinking around 10in7 was about how to capture the cow and production benefits of 3in2, but have equal benefits for the people, which is stable weekends.”

He says it basically combines TAD and OAD in a more structured weekend format.

That means milking TAD on Monday, Wednesday and Friday. Then OAD on Tuesday and Thursday, with a double up of OAD on Saturday and Sunday.

The milking timing of 10in7 can be quite flexible, especially after four months of lactation and the cows have come off their peak. He suggests farmers follow the same milking times they usually follow for TAD. For example, milking 5am and 3pm which is a 14/10-hour split, on Monday, Wednesday and Friday.

Milking regimes

Milkings per period

Months

Days/ Period

TAD all season

OAD TAD 10in7 OAD

TAD then OAD

OAD all season

August

21

42

OAD 21

TAD 42

21

August

10

20

TAD 20

TAD 20

10

September

30

60

TAD 60

TAD 60

30

October

31

62

TAD 62

TAD 62

31

November

30

60

TAD 60

TAD 60

30

December

20

40

TAD 40

TAD 40

20

December

11

22

10in7 16

OAD 11

11

January

31

62

10in7 44

OAD 31

31

February

28

56

10in7 40

OAD 28

28

March

31

62

10in7 44

OAD 31

31

April

15

30

10in7 21

OAD 15

15

April

15

30

OAD 15

OAD 15

15

May

31

62

OAD 31

OAD 31

31

304

608

475

446

304

3

3.1

3.2

3.5

133.3

162.0

304.0

1471.6

1427.2

1064.0

352.4

396.8

760.0

61.3

59.5

44.3

14.7

16.5

31.7

TOTAL MILKINGS Hours per milking* Milkings saved vs TAD Total Hours Milking

1824.0

Hours saved vs TAD Total Days Milking

76.0

Days saved vs TAD

• *includes getting cows and washup

If the cows are being knocked around by heat in the summer, milk later in the cool of the evening so that those days have a 5am milking and then 6pm or 7pm. For the OAD milkings on Tuesday, Thursday, Saturday and Sunday, he says farmers can basically milk whenever it suits – 9am to 11am, earlier or later.

“With all these milking frequencies, you can use a combination of them throughout the season. You don’t have to have one milking frequency for the whole season.

It’s about specifically targeting the frequency of milk harvests per day to

coincide with the quantity of milk being produced – something approximating 1.0kg MS per milking.”

Through the season, a range of milking frequencies might go something like OAD for the first three weeks of lactation, TAD over the peak into December, 10in7 or 3in2 over summer and OAD in the autumn. Changing the frequency of milking to coincide with how much milk is being produced is expected to produce the same total amount of milksolids harvested through the season. But with far fewer total milkings, he says.

43

Milking Frequency Day Mon Tue Wed Thu Fri Sat Sun

TAD 14in7

13in7

12in7

11in7

3in2 1st week 10.5in7

4-6am/

4-6am

4-6am/

4-6am/

4-6am/

1-4pm

1-4pm

1-4pm

1-4pm

3-7pm

4-6am/

4-6am/

4-6am/

1-4pm

1-4pm

1-4pm

8-11am

8-12am

4-6am/

4-6am/

4-6am/

4-6am

1-4pm

1-4pm

1-4pm

/3-7pm

4-6am/

4-6am/

4-6am/

1-4pm

1-4pm

1-4pm

8-11am

8-12am

8-11am

4-6am

4-6am/

4-6am/

44-6am/

4-6am/

/1-4pm

1-4pm

1-4pm

1-4pm

3-7pm

4-6am/

4-6am/

4-6am/

4-6am/

1-4pm

1-4pm

1-4pm

1-4pm

8-11am

8-11am

8-11am

4-6am/ 1-4pm

8-12am 4-6am/ 3-7pm

3in2 2nd week 10.5in7 8-12am 4-6am /3-7pm 8-12am 4-6am/ 3-7pm 8-12am 4-6am/ 3-7pm 8-12am

10in7

9in7

4-6am/

4-6am/

1-4pm

1-4pm

8-11am

5-11am

4-6am/ 1-4pm 8-11am

5-11am 4-6am/

8in7

OAD 7in7

5-11am

5-11am

5-11am

5-11am

4-6am/ 1-4pm

5-11am

5-11am

5-11am

5-11am

5-11am

5-11am

8-11am

5-11am

5-11am

5-11am

8-11am

5-11am

5-11am

5-11am

4-6am/ 1-4pm

1-4pm

• The weekday TAD to OAD regime gives you splits of 10 hours; 19 hours; 19 hours; then back to the 10, 19 and 19 cycle again (accept in weekend when 19, 22, 21) • This will minimise losses compared to straight OAD.

• 10in7 will likely have slightly less production than 3in2 (?).

• If it doesn’t work - go back to TAD; do the traditional 3in2; or go OAD. • Or try other options of milking frequency.

By milking OAD to TAD to 10in7 and then back to OAD, total milkings fall from 608 on a TAD system for 304 days of lactation to 475 milkings for the season.

“Our cows are very flexible and really enjoy less visits to the shed,” he says.

“And the need for family time for everyone in the hazy days of summer is paramount. It has been a turbulent year, what with Covid chaos, Brent Boyce. climatic challenges and changes in legislation. A lot of people have been under pressure and it is important that we have options and alternatives so that people can rest and recuperate.”

Boyce says many farmers have been doing similar routines to this and equalling or bettering their production achieved on a TAD regime throughout the season.

“That is the critical point – we can do a lot less milkings and achieve similar or better production to whole season TAD. A bonus from doing something like this is that many farms have 45-50 paddocks. After intense break feeding of the first-round grazing rotation in spring, simply go to one paddock per milking until the end of the season.”

That would mean a 22-25 day round when on TAD in spring; 31 to 35 day round on 10in7 or 3in2 over summer; then a 45-50-day round in autumn on OAD. Regardless of milking regime, Boyce says the important thing is feeding the cows properly. Reducing milking frequency is not an excuse to reducing feeding when production is the goal.

He says the findings from DairyNZ’s research into milking frequency which is now into its second year of 3in2 trials, backs up what farmers are seeing on their farms and that gives them confidence they are heading in the right direction. A workshop and presentations on 10in7 and 3in2 milking frequencies are included at this year’s (2021) South Island Dairy Event (SIDE) with a panel that include Dr Paul Edwards from DairyNZ, Boyce and a farming couple.

44

After a couple of months on twice-a-day (TAD) milking at the beginning of the season, Jason and Beth Macbeth switch to 10in7, then drop more milkings to once-aday (OAD) at the beginning of December.

Switching around milking frequencies is a lifestyle choice and as 50:50 sharemilkers, it helps them retain staff and reduces the number of empty cows.

The couple can manage the 620-cow farm in Golden Bay by themselves on weekends to give staff time off, while taking time off themselves during the week.

Jason says the TAD regime at the beginning of the season gets the cows to peak production and they follow it with about six weeks of 10in7. At the missed milkings during 10in7, he just gives the cows a new paddock.

“I actually give them more feed and still maintain our round lengths. And they hold per cow production as well as twice a day.”

They switch from TAD to 10in7 early enough to benefit reproduction because as sharemilkers, a big part of their business is having cows in calf at the end of the season.

Last year the 10in7, then OAD worked well for them on a fully irrigated farm, while this year they are testing it on a challenging, non-irrigated farm in the bay.

SPECIAL REPORT | FLEXIBLE MILKING

Fat yield

B 21.2

B 21.7

Protein yield

A 23.1

1.0 Protein yield (kg/cow/d)

Milk yield (kg/cow/d)

By Elaine Fisher

20

C 18.5

B 20.9

15 10

5

0.8

C 0.69

B 0.76

B 0.77

B 0.80

A 0.84

A 1.12

A 1.11

A 1.13

?

A 1.06

0.6 0.4

Milksolids yield

0.2

?

A 20% A A Aof the could2.5 also suit some A 1.88 1.93 1.90 ~1.96 1.82 1.89 2.0 Fat yield

TAD from regression

Fat yield (kg/cow/d)

TAD from regression

MS yield (kg/cow/d)

Protein yield (kg/cow/d)

Milk yield (kg/cow/d)

Treatment results

MS yield (kg/cow/d)

the lactation, and 8% of herds were on full MS/cow. It 0 0.0 ?cow season once-a-day milking (OAD).” of the industry in the 301-350kg/MS A A A A 1.4 A 1.5 1.13 1.12 1.11 1.13 1.06 ~1.12 1.2 hanging traditional times of milking Within the national herd on TAD, 14% range.

1.0 0.8 not only creates more flexibility for switched to OAD from Christmas and a OAD would be1.0 harder to justify for 0.6 0.5 0.4 Milk yield Protein yield A farmers and staff but may also serve further but 14% went OAD in 25lateinsignificant lactation. higher producing herds and farms with B 0.2 B A B Small statistically 23.1 1.0cost to B B B 0.0 C 0.840.0 20.9 21.2 21.7 C 0.80 0.76 0.77 to to attract newcomers to the industry, says Then 3in2 was used for 6%20 of18.5herds from less ability reduce costs because of, 0.8 0.69 more attractive 3-in-2 milking times 0.6 Paul Edwards, DairyNZ senior farm systems Christmas and for another155% from late for example, the expense of irrigation or 10 0.4 Milksolids yield scientist. lactation. interest. ?

5 0.2 A 2.5 A A A A “Can we adapt milking times to create This demonstrated that flexible milking However, 3in2 could potentially 1.90 ~1.96 1.82 1.89 1.88 1.93 play 0 0.0 2.0 1.5 a workplace that will attract people, strategies were not uncommon, and worth a beneficial role in New Zealand farm 1.0 particularly the next generation of young considering for many farms Edwards said. systems. To find out if0.5 it could, DairyNZ 13 Small but statistically insignificant cost to 0.0 people who may want to work on farms?”

Full season OAD offered the ultimate in is, through the Sustainable Farming Fund, more attractive 3-in-2 milking times was among the questions Edwards put to flexibility and was well suited to the 20 to into the second year of a three-year project the 50 farmers who attended the SMASH 25% of farms that produce under 300kg called Flexible Milking.

(Smaller Milk and Supply Herds), field day 13 near Te Aroha in November.

Long hours of work, especially around the busy times of mating and calving, combined with traditional twice-a-day TAD 10-14 h interval 3in2 of options OAD Plenty (TAD) milking were often seen as a e.g.

5am and 3pm • Could use flexible staff e.g.

• Milk any time during negative for employees or career seekers TAD 10-14 h interval 3in2 OAD outsource a milking the day e.g. 5am and 3pm • Could (+) use flexible staff e.g.

• Milk any (+) time during • Conventional wanting more flexibility and work-life outsource a milking (+) the day (+) • Conventional • Less consistency e.g. between • Increases pool of • Less consistency e.g. between • Increases pool of balance.

TAD 8-16 h interval days and weeksdays (-) and weeks (-) people available TAD 8-16 h interval people available (+) (+) However, dairy farmers used to the TAD • 25% fewer milkings (+) e.g. 6am and 2pm • 25% fewer milkings (+) e.g. 6am and 2pm • Later start or earlier model were often reluctant to consider 10in7 (3in2 - OAD weekend) finish (+) • Later start or earlier • OAD weekends (+) changing, fearing it may lead to a drop in weekend) • Can10in7 mean less (3in2 done in - OAD finish (+) a day (-) • Consistent weeks (+) production or increased risk of mastitis.

• volume OAD weekends (+) of milk to • 29% fewer milkings (+) • Can mean less done in • Large harvest in the morning = Edwards said a recent survey showed a day (-) weeks (+) need• goodConsistent milking routine that 45% of the national herd was TAD, • Large volume of milk to • 29% fewer milkings (+) harvest in the morning = meaning it was no longer the norm. “Last need good milking year 14% of herds were on 3in2, milking routine 14 three times in two days for part of the lactation; 31% were on OAD for part of

C

~1.12

TAD from regression

times to attract staff Milk yield

25

Fat yield (kg/cow/d)

Treatment results

A 1.13

1.4 1.2 1.0 0.8 0.6 0.4 0.2 0.0

TAD from regression

FLEXIBLE MILKING

Plenty of options

7

14

45

B 20.9

B 21.2

B 21.7

15 10 5 OAD

0

Treatment results

f e.g. )

•

Milk any time during the day (+)

between

•

Increases pool of people available (+)

Small but statistically insignificant cost to more attractive 3in2 milking times

)

ekend)

Protein yield

A 23.1

1.0 0.8 0.6

C 0.69

B 0.76

B 0.77

B 0.80

A 0.84

Treatment results

0.4

0.2 25

Milk yield

C 0.0 18.5 20

B 20.9

B 21.2

B 21.7

Protein yield Milksolids yield

A 23.1

15 10

Small but statistically insignificant cost to 5 0 more attractive 3-in-2 milking times

)

Fat yi

?

A A A A BA B A B 0.84 1.93 1.90 C1.82 0.76 1.89 0.77 1.88 0.80 2.0 0.8 0.69 1.5 0.6 1.0 0.4 0.5 1.0 2.5

A 1.13

1.4 1.2 1.0 0.8 0.6 0.4 0.2 0.0 ~1.96 regression

0.0

0.0

Small but statistically insignificant cost to The first year included a farmlet at the start. One herd was milked TAD attractive 3-in-2 milking times experiment where one herd milked more 3in2 at 6.30am and 4.30pm; the second was 7

A 1.12

Milksolid

0.2 0.0

2.5

A 1.82

regression

0.5

TAD from Fat yield (kg/cow/d)

~1.96

Milk yield

1.0

C 18.5

20

A 1.90

1.06

TAD from MS yield (kg/cow/d)

1.5

?

A 1.93

Protein yield (kg/cow/d) MS yield (kg/cow/d)

25

2.0

A 1.88

Milk yield (kg/cow/d) Protein yield (kg/cow/d)

Milk yield (kg/cow/d)

to

A 1.89

A 1.82

TAD from regression

MS yield (kg/cow/d)

Milksolids yield

2.5

Fat yield (kg/cow/

TAD fro regress

Treatment results

1.11

1.2 1.0 0.8 0.6 0.4 0.2 0.0

2.0

A 1.89

1.5 1.0 0.5

0.0

for the whole season (milking times 5am, milked 3in2 at 5am, 5pm and 11am (125pm, 11am = 12-18-18-hour intervals); 18-18 hour intervals). one herd milked TAD until December 1 The third herd came into the dairy at when it switched to 3in2); another herd 5.30am, 3.30pm and 10.30am (10-19-19 made the switch from March 1, and the hour intervals), the fourth at 6am, 2pm fourth herd was milked TAD for the whole and 10am, (8-20-20 hour intervals), and season (6am, 4pm = 10-14-hour13 intervals). the fifth herd was milked once a day at The stocking rate for the farmlets on the 7am.

Lincoln University Research Dairy farm The experiment showed there was was 3.5 cows/ha and 29% of the herd were a biologically small but statistically heifers. insignificant decrease in milksolids yield Each farmlet was managed between the three 3in2 milking times. The independently, but using the same OAD herd milk solids were 1.82 compared management decision rules, every with 1.96 for TAD. Paul Edwards, scientist farm systems 5am and was 3pm • Could usesenior flexible staff e.g. of • TheMilk anyshows timethere during endeavour made to ensure research were plenty Lincoln, outlines the results of research into outsource a milking (+) the day (+) management skill was consistent, with the of options other than traditional OAD flexible milking times at a SMASH field day near Conventional Te Aroha in November. only difference between the herds being milking for farmers to consider, and the • Less consistency e.g. between • Increases pool of the milking times. small cost involved in using a 3in2 system days and weeks (-) people available (+) Edwards The results showed that for a herd makes it worthy of consideration, TAD 10-14 h interval 3in2 producing 444kg MS/cow on TAD, there for the full season at 3in2 herd BCS was said.

• 25% fewer milkings (+) 6am and 2pm was likely to be a 0.085kg MS/cow/day e.g. 4.62 Evenuse the traditional TAD interval 5am– 0.25 andmore.

3pm • Could flexible staff e.g. of 10 decrease for each day in 3in2; and a 5% However, Edwards said milking at 12to 14 hours between milkings could be Later start or earlier outsource a milking (+) • Conventional decrease 18-18-hour intervals could still make for changed to 8 and 16 hours – eg 6am and finish (+)in MS for the full season 3in2 • Less e.g. between herd. long days, which led researchers to ask the 2pm, consistency giving a later start to the day and an • OAD weekends (+) Can mean less done in Fat content was less affected than it the number of milkings, earlierand finish.

TADquestion 8-16 –h“isinterval days weeks (-) or the timing weeks of the milkings This did mean a larger volume of milk aprotein, day (-)decreasing by 3% compared with • Consistent (+) that affects • 25% milkings (+) which 6am and 2pm 8% for protein. Edwards pointed out that e.g. production?” to be fewer harvested in the morning, Large volume of milk to • 29% fewer milkings (+) this was based on a one-year study, with no To find out, or a six-week required a good milking routine. Some • Later start earlierexperiment was carry-overin effects. carried out from September 11 to October farmers had- expressed concern that, with harvest the morning = 10in7 (3in2 OAD weekend) finish (+) The good change milking in milking times had an 22 this year at the 355ha Ashley Dene farm a later start and earlier finish, less work need OAD (+) in a day. That impact on body conditions scores (BCS) as• located approximately 15 km mightweekends be done on farm Can mean less done inwest of the• routine at May 8 in the study year.

Lincoln University campus. could be an issue, but thoughtful planning a day (-) • Consistent weeks (+) The TAD was 4.37 and there was an It involved five herds of 40 cows each, and allocation of tasks would overcome Large volume milkintomilk (DIM)• 29% increase of 0.001 for every day of 3in2 – so• with an average of of 34 days that. fewer milkings (+)

Plenty of options TAD 10-14 h interval e.g.

•

TAD 8-16 h interval e.g.

• • •

3in2

OAD

Plenty of options

10in7 (3in2 - OAD weekend)

harvest in the morning = need good milking routine

46

OAD •

Milk any the day

•

Increas people

The 3in2 model could open the opportunity to employ rural residents, including parents whose school runs normally exclude them from milking roles Edwards said. However, there was less consistency between milking days and weeks and 25% fewer milkings.

Another option which has some appeal was 10in7 which is a variation of 3in2 with only one milking each weekend day, which results in 29% fewer milkings than TAD. The OAD option was open to milking at any time of the day that suits the farm and staff and also increased the potential pool of people available for permanent or casual employment.

In response to a question about grazing management, Edwards said consideration needed to be given to how much feed was required for herds, especially during the longer intervals between milkings, and the use of automatic gate openers to shift cows and adding tape gates to make larger paddocks were options.

Edwards said he believed adapting flexible milking intervals could improve workplace attractiveness and there were many options available.

“The Lincoln Farmlet results look encouraging for a full season and show more attractive 3in2 milking times are possible.

However, if you are considering changing milking times, understand the ‘why’ of that decision and plan carefully in advance.”

One of the farmers attending the field day asked; “Why milk cows in the afternoon when the differences (in milk production) are so small?”

Edwards replied he was a convert to OAD. “But making that change may be a leap of faith for some farmers. Going 3in2 gives farmers the chance to dip their toe in the water. Every farm is different and it won’t suit all, but I challenge people to consider the other options to TAD milking.”

There are a range of resources on the DairyNZ website – dairynz.co.nz/milking-intervals.

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47

SPECIAL REPORT | FLEXIBLE MILKING

Q&A

Common questions farmers ask

By Anne Lee

What’s the effect on somatic cell count (SCC) of a 3in2 schedule?

Rather than after the longer interval milkings (after the 18-hour milking interval on a 12-18-18 for instance) the higher SCC is typically after the shorter interval (12-hour in this example).

It’s more of a volume story because the shorter interval means there’s less milk in the SCC reading measured in cells per millilitre (C/ml).

If you’re on daily pickup, to avoid this causing your SCC to jump around, try and arrange the tanker pick up so that it never just picks up when only the 12-hour milking interval is in the vat.

If milking is at 5am then 5pm on day one and 11am on day two try and arrange tanker pick up somewhere between 1pm and 3pm each day then it collects milk following 18 hours on day one and milk from the 18 hour and 12-hour milking on day two.

Or have pick up somewhere between 7pm and 3am so it has milk from both the 12-hour and 18-hour milking intervals on day one and milk from the 18-hour interval on day two.

It won’t be a problem if you’re on skip-a-day pickup.

Be aware that 3in2 milking can require larger vat capacity because in this example there would be 30 hours worth of milk in the vat instead of 24.

Are some cows more suited to 3in2 milking?

No research has been carried out on breed specifically. The DairyNZ farmlet and interval studies have included Friesian cross cows (F11 and F12). Jerseys are more adapted to OAD but there are also successful Friesian cross herds. Good udder support is important regardless of breed.

48

?

Does 3in2 complicate antibiotic treatment and withholding periods?

Technically the use of antibiotics is permitted only for the system described on the label – usually TAD but sometimes OAD, so the use in a 3in2 system is using the product “off label”. A vet must sign off on the use of the drugs.

What about milk cooling?

Milk volumes after longer milk intervals can be significantly larger than for a TAD milking and some farmers have had problems getting milk temperatures down to the required 6C within the regulation six hours from the start of milking or two hours from the end of milking.

Problems have also arisen in maintaining the temperature below 10C when blending a larger milking volume with an existing smaller volume in the vat.

Adjusting tanker pick-up times can solve the problem so that smaller volume milkings are added to the larger volume.

Seek farm-specific advice from refrigeration experts but in the short-term other farmers have found cooling the smaller volume to about 2C gives a lower starting point before the larger volume is blended.

• More answers to commonly asked questions such as managing mating can be found at DairyNZ.co.nz by searching Implementing flexible milking.

SPECIAL REPORT | FLEXIBLE MILKING

UDDER intervals explained

By Anne Lee

T

he idea of flexible milking times to create a three milkings over 48 hours schedule stems from an understanding of what’s going on at an udder level in terms of milk, fat and protein yield.

Research from the 1950s and 60s showed that milk accumulates in an approximately linear fashion until 16 hours after the last milking and after that it begins to decline.

Based on that information early adopters of the 3in2 milkings schedule stuck rigidly to the 16-hour milking intervals with milking carried out about 5am and 9pm on day one followed by only one milking the next day at 1pm.

This achieved a reduction in total

Milk, fat and protein yields at varying milking intervals

Inside the mammary gland.

milkings without unduly penalising milk production but the night milking was often unpopular.

Over time farmers evolved this to where a 12-18-18 hour interval is the most common. But the 12-hour interval can still make for a long day which is why DairyNZ added two more attractive times in year two of its flexible milking project to compare with OAD and TAD. The three-in-two intervals included: • 12-18-18 hours • 10-19-19 hours • 8-20-20 hours The rate of milk accumulation in terms of milk yield in the study followed a similar linear pattern as earlier studies with the decline coming in at milkings with longer intervals – beyond 16 hours.

Protein composition followed a similar

Milk, fat and protein yields at three different 3in2 milking intervals

Milk Yield

Fat

Milk

trend to milk yield but fat continued at the same rate in a linear fashion showing no sign of declining even at the longer intervals tested.

There was a small but statistically insignificant difference in milksolids production between the three different 3in 2 intervals, indicating farmers can be more flexible in setting their milking times.

There was a small cost to both fat and total milk yield when there were consecutive long milking intervals.

Based on that knowledge farmers could consider altering milking times slightly so instead of even intervals in the longer situation the shorter interval could be followed by a slightly longer interval than the next - 8-22-18 for example - although this has not been investigated.

Fat

Protein

Milksolids

Protein Intervals in hours

49

SPECIAL REPORT | FLEXIBLE MILKING

Making the

SYSTEM FIT

A young Canterbury farmer’s succession has followed a challenging route. Anne Lee reports.

50

I

t’s hard to know what John Totty’s forebears would have thought of the innovative 10 in seven days milking schedule now in place on the farm they settled 100 years ago.

But there’s no doubt John’s pretty sold on it. Maybe it’s his adventurous spirit, evident in the seven years he spent as a hunting guide and horse wrangler in the Yukon or maybe it’s his savvy head for numbers gained while completing a degree in finance and accounting from Otago University.

Whatever it is, the 30-year-old is up for a challenge, happy to look outside the square and energetically explore a farm system that suits the Canterbury dryland location close to the foothills and ticks the boxes in terms of people, animals and very importantly profit.

Right: John Totty among some of his cows with Mt Somers in the background.

John says he always knew he wanted to return to the family farm which is celebrating its centenary.

His great, great grandparents had been dairying near Clandeboye before setting out to find the 90-hectare Staveley farm that’s been in dairy ever since.

Over the years it’s grown to 333ha and the dairy farm has expanded although at times there’s also been some cropping, up to 3000 sheep and even a spot of goat milking.

John started buying into the farming business eight years ago, but after his father Ian died tragically falling from a shed roof in 2016, he bought the home farm with some help from family loans and of course the bank.

Making a reliable, good profit is essential.

“I’m pretty much on the wrong side of all the banking ratios so getting debt down is a priority.”

John didn’t jump straight back into dayto-day farming, instead asking the lower order sharemilker on the farm to stay on for another year while he worked on a large-scale farm at Dunsandel.

“I wanted to get outside experience and see how others did it. Even though I got offered a 2IC role I went in as a dairy assistant and worked my way up pretty quickly from there.”

He sought out information from trusted sources, reading voraciously (including the Dairy Exporter), connecting with DairyNZ, completing PrimaryITO training and surrounding himself with experienced, respected advisors, both rural professionals and farmers. At the same time, as farm owner he was working with the sharemilker on the home farm making key strategic and management decisions.

The farm had been milking 750 cows at peak producing about 265,000kg milksolids (MS) but John could see there were some fundamental farm design factors holding back productivity. John’s father had put

in two herringbones in 1996 and 1997 – a 36-a-side on the Lawnhayes block and a 20-a-side on the neighbouring Bushside block. Because the farm had been added to over the years some of the lanes took the “long way round” getting back to the farm dairies.

“A lot of the corners were being used as runoff and it just wasn’t easy to move cows around.

“There were still a lot of sheep paddocks so when I came back, we re-laned the whole farm and gutted three blocks to refence them on to the new lanes.

“A lot of paddocks were still set up for a 200-cow herd – that could mean up to four shifts a day.”

The redesign was done with the help of experienced farmer friends and advisors.

“It’s good to have fresh eyes – it’s hard when you’ve looked at a farm your whole life and think that’s just the way it has to be.”

The result was an hour less MON TUE WED walking for cows 5am/3pm 11am 5am/3pm each day on a TAD milking system.

THU 11am In his first season back home FRI SAT SUN in 2017/18, John 5am/3pm 11am 11am milked TAD from the outset,

in

10 7

Farm facts

Location: Staveley, Canterbury Cows: 1050 Jersey, Jersey cross Total area: 440ha Effective area: 322ha pasture plus crop for transition Production: 385,000kg MS (budgeted 2020/21) Supplement: 100kg DM/cow bought-in FWE: $4/kg MS Milking schedule: 10in7 with OAD for first three weeks of lactation Irrigation: none Stock reared: 600 calves including 200 Jersey 2 year old bulls Support block: 40ha Farm dairies: 36-aside and 20-aside Staff: four plus runoff manager and calf rearer.

51

Above: LIC AI technician Emily Oram attends to a cow in the farm dairy. Right: Jersey cows walk across a road from milking on their way to fresh pasture.

expecting to drop back to once-a-day later in the autumn.

But from the second week of November the typical “spill-over” rain from the Nor’ West dried up and, heading into the second week of December with no rain on the horizon, he made the decision to send his biggest Friesians off-farm to friends with irrigation and put everything else on oncea-day (OAD).

“We bought some palm kernel in and used silage we had on hand but it wasn’t till March 6 that we brought the Friesians back.

“They were pumping on TAD and our other Friesians were back on TAD by then too.

“The 500 cows we had on OAD stayed on that right through – mainly the Jerseys.

“But they just didn’t drop from the 1.5kg MS/cow/day they’d initially dropped to when I put them on OAD. “We managed to do the same production for the season as the sharemilker had done with the same number of cows.

“I started thinking maybe the system we had wasn’t quite the right one for these cows here.”

So, he started researching and asking advisors who the best OAD farmers were.

“A lot of people doing OAD that I talked

52

to had dealt with the lower production by cutting a staff member but because we had two sheds, I struggled to see how I’d cut a whole staff member and I needed to maintain profit.

“We could have milked OAD at each shed, just different ends of the day but we wouldn’t get any of the people benefits I was looking for in creating a more sustainable place to work.”

He liked the look of 3in2 particularly if it could be done at more “normal” milking times as research was suggesting. So he tried 3in2 in the autumn in 2018/19 and in 2019/20 went 10in7 from January 15.

The cows held production and even lifted a little giving 340,000kg MS from 900 cows for that season.

That gave him confidence and this season he’s not only using research findings to base his system on, he’s also helping build research knowledge, joining the DairyNZ flexible milking project in the second year of the study as one of six pilot farms.

Over the past three seasons John has lifted stock numbers to 1050-cows, moving to a more Jersey herd by both breeding and buying in good quality calves from well-known Jersey breeders Steve and Nina Ireland.

THE NEW SYSTEM IN ACTION This season planned start of calving for the main herd was August 10 with most cows OAD for the first three weeks of their lactation.

Cows are calved on Lawnhayes and milked through the 36-aside dairy OAD until 400 cows have calved - around August 15.

The Bushside farm dairy is then started up and 300 cows moved across to that block.

“When we get to 300 cows at Lawnhayes we change the colour of the paint we use to show cows are clear to come out of the colostrum mob.

“That means we can easily identify the 300 that need to go over to Bushside and on Lawnhayes we know when to reset the next three-week OAD group.”

They milk OAD for about five weeks at Lawnhayes and then go to the 10in7 programme. Cows going to Bushside go straight on to 10in7.

John says that based on the research showing there’s only a small (about 2%) reduction in milk production from OAD milking in the first three weeks, he’s used the tactic as a way to manage workload on his four staff through the early and peak calving period.

“We actually had time to do the refencing we needed to do in the afternoons on both farms through early spring.”

Milking started at 8am initially with the aim to have everyone home by 5pm and, as more cows calved, milking time gradually moved earlier to keep the same home time.

The earliest was 5.30am cups on.

10-IN-7 The 10in7 programme is a combination of 3in2 and two consecutive OAD milkings to allow for OAD at a weekend.

In John’s case the Lawnhayes block starts the week with two milkings on a Monday at 5.30am and at 2.30pm with Tuesday a OAD milking at 2.30pm.

Wednesday is TAD, Thursday OAD and Friday TAD. Saturday’s milking is at 10am and Sunday’s at 8am.

“It’s so good in the weekends. People can go out on a Friday and Saturday night if they want to. They can catch up with friends.

“We just do the absolute must-do jobs on those weekend days so once milking’s over people generally head home.

“The other great thing is that every week is the same.

“On a full three-in-two schedule, each week is different and it can really confuse people – they can’t quickly remember when they’re coming back from days off what time the next milking is.

“It also makes it tricky to plan things out in advance whereas we all know, even four months ahead, what the milking times are on any given day.”

John has staggered the other farm dairy so that Bushside has its consecutive OAD days on Sunday and Monday.

Only one person is required for milking there for the 380 cows. He’s planning on extending the farm dairy there and fitting automatic cup removers to make sure they keep it to one person needed for milking.

John says the 385,000kg MS target from 1000 cows is firmly in his sights using about 100kg DM/cow of supplement.

About 100kg DM/cow of silage is made on the milking platform during surplus and fed back to cows through the hot, dry months of January and February but they don’t feed out during autumn, instead using homegrown fodder beet as cows are transitioned up to 4kg DM/cow.

About 300 bales of silage are exported off farm for wintering. He meets with his two senior staff twice a week – the first meeting to review covers, with the farm plated every week, to look at where the cows have been, plan any silage cuts and make paddock and feed allocation decisions. Managing pasture on the dryland Canterbury farm is an absolute priority to ensure maximum, high quality pasture harvested by cows.

The second meeting will discuss how that’s tracking, cow condition and any other

10in7 Lawnhayes

milking schedule and milking intervals in hours

MON

TUE

WED

5.30am

10am

5.30am 10am

5.30am 10am

2.30pm

2.30pm

2.30pm Time from

19.5

Last milking

7

Bushside

8am

Time from

26

19.5

19.5

THU

19.5

7 5.30am

10am

2.30pm Last milking

activities coming up. They have three full team meetings a week too and have begun using the Kanban system (see Dairy Exporter August 2020) to manage farm tasks.

Cows peaked 10% lower this year at 1.9kg MS/cow/day on Bushside and 1.8kg MS/cow/day at Lawnhayes where most of the Friesians and lower BW cows are run.

“It’s hard to say how much of that is due to the milking frequency changes or because of the season – a lot of people are reporting a lower peak and then a big drop from peak this season.

“Compared with last season though our production is 14% up to date with 100 more cows.”

He’d synchronised mating for his heifers’ last mating so they had a compact calving, starting before the main herd and he’d also bought in 60 earlier-calving cows from the North Island which helped improve production for the first two months by 30%.

Cows have held daily production well through into early-December with John actually seeing a slight per day uptick.

“We had thought we might get a 5% reduction in milk production off the 390kg MS/cow, excluding calf milk, we did last year.

“But we’re still on target for 385kg MS/ cow which doesn’t include the calf milk we took out.

“That would push production up over 400 if we put that back in.”

Having enough vat capacity for the milking following the longer interval is something to be aware of, as is the need to ensure milk chilling systems can handle the

19.5 7

19.5

FRI

19.5

SAT

17.5

SUN 8am 26

7 5.30am 10am

5.30am 10am

2.30pm

2.30pm

19.5 7

19.5

19.5

17.5

7

53

additional volumes, he says.

With the extra 100 cows total production going to the factory will be up by about 34,000kg MS for no extra cost.

“I’m pretty tight on costs – we don’t spend money unless it’s going to give us a return and we’re on track for $4/kg MS for farm working expenses.”

Cow condition has been exceptional this year. The season has been relatively good but unlikely to have contributed largely to the gain in cow condition so John is putting much of the improvement down to the system change. Better cow condition has already brought savings.

For the first time he’s been able to use no intervention to get cows cycling at mating this year – last year he did 14%.

That’s been helped too by his decision to only use bull matings at Bushside and no AI. He’s organised the herd there to include his bottom 30% BW cows, anything he doesn’t want a replacement out of, cows with unsuitable udders, recurring feet problems or anything likely to be on the cull list.

“We’ve also made savings on power using 10in7 but it’s hard to say exactly how much because although we’re doing 33% fewer milkings some of the milkings are longer.

“Fewer milkings also means we’re using less fuel and maybe less repairs and maintenance eventually.

“We’ve definitely seen a drop in lameness – it’s dropped by 50% or even more.

“Last year we used the Healthy Hoof lameness app so we’re recording everything.

“I think we may see benefits in autumn

and winter too because I think we’ll see cows hold their condition better through autumn – which means we’re not likely to go OAD at all through the autumn and cows will be able to milk on longer.

“We usually condition-score the cows to create wintering mobs but I think we’ll have fewer lighter cows and there will be a saving on winter feed.”

There are also those less tangible benefits that help cut costs and improve efficiency - factors such as staff retention and improved engagement. He runs a seven-on two-off, seven-on-two-off, seven-on-threeoff roster and John steps in to milk and cover days off or holidays.

Farmers often cite worries with getting artificial insemination (AI) technicians when they need them when they’re considering going to three-in-two milkings.

“I think that comes from when people were sticking really closely to the milking intervals that meant they were milking at 10.30pm at night but we haven’t had any trouble with the milking timings we’ve got.”

John says the AI tech is happy to get to the farm at 12.30-1pm on the weekdays they are milking OAD and 9am on the days they milk twice. On the weekends it’s also after the tech’s other farmers so fits in well.

He’s putting Jersey across all of his cows because he believes they’re suited to the system and the dryland, low input, situation.

Three-week submission rate was 91% and based on returns he’s hoping mating results will be improved.

Cell count and mastitis haven’t been a problem this year despite John only using teat seal at dryoff last year.

Working in the herringbone shed are Anna Schussler, dairy assistant and Antony Gann, manager.

“We only had four cases of mastitis in the first 680 cows calved and we’re sitting around 80-90,000 cells/ml but I’m confident we’ll run at about 70,000.

“Generally, I’d have to say the cows look better – they spend more time in their paddock grazing, more time resting and doing the things cows should be doing.

“It’s great to see even older cows kicking their legs up and running around, those are some of those intangible benefits, I guess.

“I don’t think you’ll see us going back to twice-a-day any time soon – there just seem to be too many positives here.”

TALK TO THE EXPERTS FOR FARMING SUPPORT 07 858 4233 farmservices.nz

TO SUPPORT ANIMALS WITH FACIAL ECZEMA

54

info@farmservices.nz

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ENVIRONMENT GHG EMISSIONS

Know your GHG numbers Words by: Elaine Fisher

B

y New Year’s Day, 2022, a quarter of New Zealand farms must have a written plan in place to measure and manage their greenhouse gas emissions, and that will be compulsory for all farms by January 1, 2025.

This is among the requirements of He Waka Eke Noa (Our Future is in Our Hands), a partnership between the government and the primary sector to reduce primary sector emissions.

It involves working to equip farmers to measure, manage and reduce on-farm agriculture greenhouse gas emissions (GHG) and adapt to climate change, to enable sustainable food and fibre production for future generations.

AgFirst agricultural economist Philip Journeaux says Fonterra and Synlait have begun calculating the figures for their suppliers, which has raised awareness among farmers of the need to know their emission numbers.

In addition, Phil and the AgFirst team have been working out numbers for sheep and beef farmers, including Rick and John 58

Burke of Pukekauri Farm near Katikati.

The numbers are based on data supplied by farmers, including their livestock types, stocking rate, animal production, fertiliser inputs, rainfall and soil type. Overseer software is used to calculate the greenhouse gas emissions of each farm.

‘There will be many sheep, beef and dairy farmers across New Zealand who have a great story to tell about their regenerative practices producing high-quality nutritious food from grass-fed animals.’

In the case of Pukekauri Farms, data from 1998-99, 2014-15 and 2020-21 was used to show emissions had decreased by 60%, and based on inflation-adjusted figures, its

profitability has improved by between 20 to 25% overall since 1999.

“This has been achieved over a period of about 20 years and includes the effective use of drymatter by livestock that have been chosen for their genetic growth potential. It also includes the planting of exotic forest and areas retired and planted in natives,” says Phil.

Many farmers are still dealing with the new requirements around fresh water and while they also need to know their numbers for GHG emissions, Phil cautions against making any dramatic changes to farm management or stock type until further He Waka Eke Noa provisions are announced.

In the meantime, Beef + Lamb NZ Mid-Northern Farmer Council member Rick Burke is urging farmers to “do their numbers”.

“There will be many sheep, beef and dairy farmers across New Zealand who have a great story to tell about their regenerative practices producing highquality nutritious food from grass-fed animals.”

That information will add to the growing

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

evidence that shows while there is still room for improvement, pastoral farming in New Zealand is not a major contributor to global warming.

“Your numbers will provide evidence to support the recent study commissioned by B+LNZ, led by Dr Bradley Case of Auckland University of Technology, which estimates that the woody vegetation on New Zealand sheep and beef farms is offsetting between 63 and 118 percent of their on-farm agricultural emissions.”

Telling the story of the positive climate impacts of sheep and beef farming and backing it with the evidence is vital to help counter the consumer resistance to eating red meat, Rick says. “Kanoa Lloyd of the TV3’s The Project said recently she would not eat as much red meat because growing it was contributing to warming the planet.

That’s misinformation that I believe has come from big fossil fuel users. They have done well in deflecting the blame for global warming on all agricultural sectors, red meat in particular.

“I acknowledge a big chunk of those in the agricultural industry worldwide, including feedlot, intensive farming and arable farming using high inputs, are not farming sustainably, but many sectors are, and that needs to be recognised,” he says.

Pukekauri Farm’s approach to farm management began to change in 1998 when a Land Environment Plan was formed in conjunction with Bay of Plenty Regional Council staff. This led to a progressive programme of retiring and fencing out waterways and marginal areas of the farm. As a result, the farmed effective area has reduced by 25%, but production has gone up. “That’s because the areas we retired were marginal and often cost money in terms of fertiliser, weed control, and stock management.”

At the same time attention was turned to the livestock. Today Rick says Pukekauri stock are farmed to their best genetic potential. “We were lucky to have got ahead of the curve, and if you like

Above: Rick Burke believes many sheep, beef and dairy farmers have a great story to tell about their regenerative practices producing highquality nutritious food from grass-fed animals.

Right: A progressive programme of retiring and fencing out waterways and marginal areas has reduced Pukekauri Farm’s effective area by 25% but production has increased.

Pukekauri is a sort of lighthouse for what can be achieved, but I know many New Zealand farmers are doing similar work on their land.”

Those farmers are returning to the practices that were once a tradition in this country, paying close attention to the health of the soil and livestock – practices which changed largely due to the Livestock Incentive Scheme and Marginal Land Loans of the 1970s and encouraged farmers to carry more stock and to break in marginal land.

“Farmers slashed and burnt too much marginal land, but today much has been restored to its original state, including under the QE2 Trust or retired under regional council schemes.”

Pukekauri Farm is today not only

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

more profitable and sustainable, but says Rick, it’s also a more pleasant place to live and work.

“Redesigning the farm system has improved its biodiversity, from birdlife to insects, to stream life.

“We also know our soils are healthy, which means our animals are too. All this is good for our own health as we are not faced with unwell stock and high vet bills.

Many farmers tell me changing from a high input system with a change in focus from quantity to quality and lower inputs is making just as much money but is far less stressful.”

• To find out how to quantify your farm’s GHG numbers contact Beef+Lamb NZ or DairyNZ.

59 59

ENVIRONMENT FRESHWATER

Advisory group has come up with recommendations to make the regulations more practical to implement for farmers while not diminishing the protection they give to waterways.

Ministers get water regs advice

R

ecommendations for changes to the proposed winter grazing rules have been presented to Government ministers in December from an advisory group aiming to improve the practicality of rules and to achieve better environmental outcomes.

The Southland Advisory Group was formed after concern from farmers and sector organisations that a number of rules were impractical, challenging to meet and costly for councils to implement.

DairyNZ strategy and investment leader Dr David Burger said.

“We are pleased to have worked with farmers and sector organisations to develop clear and practical recommendations for onfarm wintering actions which will lead to better outcomes for the environment and local communities.”

Following a meeting with the Ministers in September, a group was formed and asked to look at the implementation of the intensive winter grazing rules within the

‘We are pleased to have worked with farmers and sector organisations to develop clear and practical recommendations for onfarm wintering actions which will lead to better outcomes for the environment and local communities.’

The rules are part of the Government’s National Environmental Standard for Freshwater.

“While DairyNZ supports the intent of the Government’s regulations, which is to protect the environment, the rules need to be fair, reasonable and achievable,” 60

new National Environmental Standards for Freshwater.

The group included several farmers, and staff from Beef + Lamb NZ, DairyNZ, Federated Farmers, Fish and Game and Environment Southland, who have worked together on finding practical solutions

to some of the issues raised with implementing the regulations across the country.

Environment Southland chairman Nicol Horrell is very Environment Southland chairman Nicol Horrell. pleased the group has worked so well together and has come up with a package of recommendations to make the regulations more practical to implement for farmers while not diminishing the protection they give to waterways.

“The group has worked at pace and come up with some very practical suggestions. I am optimistic this report and recommendations will land well with Ministers and officials,” Horrell said.

Regulations announced in August were focused on getting swift improvement in water quality. Keeping this goal as their key focus, the recommendations put to Minister for the Environment David Parker and the Minister of Agriculture Damien O’Connor this week aim to ensure this happens.

In the report, the group notes that

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

BOOKS

improvements are needed to intensive winter grazing practices - intensive winter grazing, when done poorly, poses risks to waterways.

DairyNZ environment “There is low manager Dr David Burger. tolerance (in the community) for farmers who are not improving their intensive winter grazing practice as they are seen to be “letting the side down” and bringing the practice into disrepute.”

In working through the detail, the group looked into the intent of the rules and in a few cases identified practical challenges with the implementation and potential perverse outcomes.

Suggested improvements or alternatives have been made and additional measures have also been suggested.

Most importantly, the group agrees farm environment plans are the future for managing freshwater.

While this important tool is developed further, the group recommends work commence immediately on a step that can be used in the interim – an intensive winter grazing module. This would enable farmers to identify the specific risks on their property, and show alternative good management practices they are implementing to mitigate the impacts on freshwater.

The group has also recommended a

measure which focuses on managing critical source areas. The pugging and resowing rules would lead to perverse outcomes, however managing these areas would lead to improved environmental health. The recommendation suggests critical source areas are protected within intensively grazed areas (leaving a fivemetre-wide, uncultivated and ungrazed buffer).

Managing critical source areas is accepted good management practice and embedding this concept into the regulations is seen as the best way forward.

The advisory group will present their recommendations to the national Freshwater Implementation Group and ministers are seeking advice from officials before determining any next steps.

“This collaborative approach is the way forward for developing regional council plans as the National Environmental Standard for Freshwater takes effect over the next few years,” Burger said.

“We know farmers have made significant strides in improving their wintering planning and care for the environment and animals, and acknowledge there’s more to do – we are on the journey.”

KEY RECOMMENDATIONS • Until a certified freshwater farm plan process is available, an alternative should be provided to enable farmers to show alternative GMPs they are implementing that will mitigate adverse effects to freshwater health, when they cannot meet the permitted activity conditions.

An intensive winter grazing module is recommended as an interim measure.

• A new condition is recommended requiring critical source areas are protected within winter grazing areas (this means leaving a 5m wide, uncultivated and ungrazed buffer).

• Amendments recommended to some of the conditions, including: ¤¤ The pugging and resowing date conditions are not practical or effects focused, therefore they should be deleted. ¤¤ Slope rule should be amended to allow intensive winter grazing on slopes of 15 degrees or less (removing the requirement to determine the mean slope of a paddock and replacing it with a specific maximum slope).

MEMBERSHIP OF THE SOUTHLAND INTENSIVE WINTER GRAZING ADVISORY GROUP: • Two farmers: Paul Turner (dairy farmer, and previously a deer farmer), Dan Frew (sheep and beef farmer) • Beef + Lamb NZ: Corina Jordan (Environment Policy Manager) • Dairy NZ: Matt Highway (Environment Change Manager) • Fish & Game: Jacob Smyth (Resource Management Officer) • Environment Southland: Lucy Hicks (Policy and Planning Manager) • Federated Farmers: Bernadette Hunt (Vice President, also sheep, beef, arable, dairy grazing farmer).

We have a range of books for sale on our website:

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Dairy Exporter | www.nzfarmlife.co.nz | January 2021

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ENVIRONMENT CATCHMENT CARE

Aparima environment plans driving change

A

new survey of farmers in Aparima, Southland, shows farms achieve better environmental results when they have Farm Environment Plans (FEPs).

Six hundred dairy, sheep and beef farmers work together in the Aparima Community Environment Project. The aim is to improve the health of freshwater and reduce farmers’ environmental footprint.

A recent survey of 151 Aparima farmers showed 80% have FEPs – an increase of 23% on last year. The survey also highlighted that farmers with environment plans are more likely to implement a range of good farming practices.

“These survey results show how serious farmers are about taking care of the environment,” said Otautau dairy farmer Edwin Mabonga, from mid-Aparima.

Of the farmers surveyed, 95% have excluded stock from waterways – up 4% on last year. Eighty-seven percent use nitrogen fertiliser strategically – up 4% (this means using fertiliser only as needed to maximise pasture uptake and only on certain parts of the farm).

“Farm Environment Plans identify environmental risks and management options on the farm and contribute to improving water quality and other environmental benefits,” said Edwin.

“They are living, breathing documents that help farmers achieve better environmental outcomes.”

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Sheep farmer Leon Black’s love of the land shows through in the care he takes of the environment on his farm.

Plans must include actions to reduce farm sediment and nutrient loss, outline how wintering rules will be implemented, and where to riparian plant and fence. The plans are reviewed annually.

Thousands of farms already have a comprehensive FEP and sector groups are continuing to further develop them as an effective way to accelerate further improvements.

Farmers in the Aparima Community Environment Project are making significant changes, which illustrates the type of innovation and commitment needed to surpass good management practices and set

farmers in good stead for future.

Edwin said his FEP ensures all his team know and understand the way the environment is looked after on the farm.

“For us a big benefit is to have everyone on the farm thinking environmentally.”

Edwin and his wife Fungai are equity partners and have been carrying out farm riparian planting for 10 years.

All staff are involved in tree planting, which gives them a sense of ownership in the environmental work, he said.

Aparima sheep farmer Leon Black said it’s great to see environmental practices are continually improving as a result of targeted farm plans.

“Caring for the environment is a core plank of a farming business,” said Leon. “A Farm Environment Plan helps ensure good farm management practices, and to identify and manage any potential issues.”

Key initiatives Leon and his wife Wendy carry out on their 370ha farm include planting about 300 trees a year, providing shelter and shade for stock. The farm has been in the family for almost 100 years.

The Aparima Community Environment Project is led by farmers and supported

by DairyNZ, Beef + Lamb New Zealand, Environment Southland and Fonterra.

• Find out more about Farm Environment Plans at dairynz.co.nz/fep or beeflambnz. com/farm-plans

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

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Above: On their Aparima farm, Edwin and Fungai Mabonga have fenced and planted alongside waterways including the Aparima River and a wetland to protect water quality.

Right: Dairy farmer Edwin Mabonga.

ABOUT THE APARIMA COMMUNITY ENVIRONMENT PROJECT

HIGHLIGHTS OF FARMER SURVEY

• This large-scale project began in 2018 and involves 600 farmers in the Aparima, Pourakino, Waimatuku and coastal Longwood catchments, addressing water quality issues and reducing farmers’ environmental footprint.

• Of the 600 farmers – 216 are dairy farmers, 384 are sheep and beef farmers.

• The project involves farmers, land managers, extension experts and scientists working together to identify, implement and track environmental actions.

• Through modelling and monitoring, the actions of every FEP will be linked to demonstrated changes in water quality outcomes.

• 95% have excluded stock from waterways – up 4% on last year.

• 87% use nitrogen fertiliser strategically – up 4% on last year (using amounts only as needed to maximise pasture uptake and only on certain parts of the farm).

• 80% recycle chemical containers – up 6%.

• 78% leave ungrazed buffers around critical source areas – up 7% on last year (this involves protecting low-lying parts of farms, such as gullies and swales where runoff accumulates).

• 77% use Spreadmark accredited equipment/contractors – up 3%.

• 74% do paddock scale soil testing – up 6%.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

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63

ENVIRONMENT EMISSIONS

Making a contribution: The 2 million hectares of woody vegetation on livestock farms are estimated to offset 90% of their total emissions.

The climate neutrality question Words by: Steven Cranston

A

fter another tough year of negative headlines it was reassuring to see the first green shoots of commonsense tentatively appearing on the vexed subject of agricultural emissions.

They came by way of a Beef + Lamb NZ report demonstrating their sector is well on the way to carbon neutrality. It was found that the 2 million hectares of woody vegetation on sheep and beef farms are estimated to offset 90% of their total emissions.

This report is significant as it represents a shift in thinking. Now instead of only counting the emissions produced by farming in isolation, we see how these emissions are also simultaneously balanced by carbon uptake. What this report shows is how farms work in the real world and will hopefully bring in a new era of farmers getting full recognition for the carbon they sequester on their properties.

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Even more remarkable is that the sheep and beef sector has got to 90% carbon neutral with both hands tied behind their back. For a start, applying the term ‘carbon neutral’ to agricultural emissions is meaningless.

We are simply comparing apples with oranges via an accounting system not designed for that purpose.

Methane is a short-lived gas and behaves completely differently in the atmosphere.

NZ agriculture has effectively stabilised its methane emissions and according to the best science to hand, 80% of farmers’ total emissions have no warming effect on the climate. This represents a major missed opportunity by Beef + Lamb to correct the record before farmers are needlessly lumped with a tax on methane.

A bolder, more progressive Beef & Lamb would have seen their sector has in fact been dealt a very strong hand. In total, NZ farmers emitted 37,697 tonnes of CO2 -e (CO2-e = CO2 equivalent) in 2018, of which 29,426t was methane.

The last five years of data indicate an average reduction in methane emissions of 0.25% a year, ensuring a negligible impact on climate. Therefore, the industry only emitted 8271t CO2 -e that can be considered climate warming, predominantly nitrous oxide.

Now here’s where it gets interesting.

Beef + Lamb’s research found that carbon sequestration from woody vegetation on their farms alone was 10,394t CO2-e at the lower end and is possibly as high as 19,600t. Our humble sheep and beef farmers can easily offset all the annual warming produced by the entire agricultural industry.

Unbeknown to most hill country farmers, and apparently their sector representatives, incoming climate regulations could and should see them profit handsomely. They should be selling carbon credits to a dairy industry in need of offsets, officially making the entire industry climate neutral.

This would be a boon for dairy as well,

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

the ability to rebrand products as climatefriendly would more than outweigh the costs involved. Keeping in mind, dairy is not the climate destroyer it is made out to be either.

With warming mostly driven by nitrous oxide which only makes up 20% of the sector’s total emissions, and with a sizable amount of woody vegetation on dairy farms as well, the shortfall may not be that great.

Sadly, without a resolution to the methane issue the focus is destined to remain on total emissions rather than the warming they produce. It must irk farmers to see businesses celebrated in the media for merely setting a lofty carbon-neutral goal while their own stabilised methane status receives only scorn.

Both achievements represent zero impact on climate yet are treated very differently by the media and politicians.

The argument repeatedly made against methane is that the existing level of methane in the atmosphere will continue to warm the planet. That is true to a point, we need greenhouse gases to avoid the earth returning to its resting temperature of -18C. The goal of the Paris Agreement was only ever to limit further warming so it remains unclear why farmers are not given credit for achieving that objective.

No one assumes our industry leaders have the power to force this Government to modernise the way they account for methane overnight, that will take time and a lot of convincing.

What they could be doing now however is educating the public and their consumers about how climate friendly farming really

is. This is where we have failed miserably to date.

A campaign to demonstrate we are climate neutral would be the most effective way to get that message out there. Eventually, the concept of putting a blanket emissions tax on a climate neutral industry will start to receive the raised eyebrows it deserves.

To think the likes of Fonterra, DairyNZ and Beef + Lamb are not acutely aware that farmers are getting a raw deal on emissions is naive. The issue is a lack of willingness to do anything substantial about it which might see them earn a negative press release from Greenpeace or other likeminded columnists.

Ironically the best hope for New Zealand farmers may come from The United States.

A recent report from the University of California titled ‘Methane, Cows and Climate Change: California Dairy’s Path to Climate Neutrality’ demonstrates a model all agricultural industries should take note of.

If climate neutrality can be achieved in that great bastion of political correctness and industrialised dairy farming, it really makes you wonder what an immense opportunity we are squandering down here.

We may not be global leaders on this subject but I hope for the industry’s sake we get to work and start following.

This represents a major missed opportunity by Beef + Lamb to correct the record before farmers are needlessly lumped with a tax on methane.

The goal of the Paris Agreement was only ever to limit further warming so it remains unclear why farmers are not given credit for achieving that objective.

• Steve Cranston is a Waikato- based agricultural and environmental consultant.

• First published in Country-Wide January 2021

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

65

STOCK MASTITIS CONTROL

Counting down with mastitis An inter-generational farming family in eastern Waikato have achieved consistently low somatic cell counts. Elaine Fisher describes how they do it.

W

hen 12-year-old Ruby White steps off the school bus at the end of the day, it’s not chilling out or homework that’s on her mind.

Instead Ruby heads to the dairy to help mum Tania milk the herd of 170 cows, each of which Ruby knows by name.

“Ruby is my right-hand helper in the shed; she just loves milking and being with the animals,” Tania says who, as a successful dairy farmer, is indisputably also her daughter’s role model.

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The shy youngster, who attends St Joseph’s School in Te Aroha has an ambition to follow her mother into farming but her view of the career is not through rose-tinted glasses. She knows the truth of the old adage “when you have livestock, you have dead stock too”.

“I love spending time with the cows,” Ruby says, as she hugs “Babe” in the paddock.

“Ruby understands that this is a business and that while we care for our cows, they are not pets,” says Tania.

Dairy farming is definitely in Ruby and Tania’s genes. Tania’s parents, Graham and Glenys Bell, are dairy farming close by at Waihou near Te Aroha, and Graham can trace his farming lineage back at least two generations.

Not only has the family been farming for a long time, but they also do it extremely well. Graham and Glenys have for many years had the lowest BMSCC (Bulk Milk Somatic Cell Count) results of any Fonterra supplier, and Tania, the second lowest.

It was for Tania’s impressive results that

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

‘Graham and Tania only treat cows which have a good reaction [to the RMT test] and check on anything else. They have a good memory of how a cow was from one stage to the next and are looking for change.’

Left: Healthy happy cows – that’s the mantra for three generations of Te Aroha farmers – Glenys and Graham Bell, their daughter Tania White, and granddaughter Ruby White.

Below: Ruby White (12) wants to be a dairy farmer, just like her mum.

she was asked to host the SMASH (Smaller Milk and Supply Herds) field day in November when the focus was on being grade-free, on flexible milking and on summer feed management.

Steve Cranefield, technical manager with AgriHealth of Auckland, led the discussion on mastitis management for the 50 farmers who attended the field day, bringing Tania and her father Graham into the discussion to explain their strategies for achieving such consistently low cell counts.

Tania’s BMSCC results were 31,180 cells/ ml in 2019/20, the second lowest for a Fonterra supplier. While achieving low counts is important, Tania and Graham said that was not the prime focus of their management system. Healthy, happy cows are what they strive for and low somatic cell counts are a consequence of that policy.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

Tania is an AB technician for LIC, a role she has carried out for the past 25 years, alongside sharemilking. Three years ago, she moved from sharemilking at Te Awamutu to become the sharemilker on the 49-hectare farm owned by Jane Mellow, whose family links with that land go back nearly 100 years.

There Tania runs 170 cows mostly pasture-fed, with some maize for autumn feed and palm kernel for spring. The property, largely flat, has 3ha of chicory.

Tania’s approach to mastitis is one of prevention. She uses both the antibiotic dry cow treatment and Teatseal, the nonantibiotic inert substance that forms a plug in the teat canal, to prevent mastitis throughout the dry period and at calving.

“We pick up cows and calves twice a day. Any cow we have concerns about is brought into the shed and tested for mastitis. Any cow reacting badly will be treated, but anything that is a little bit iffy will be watched and checked at every milking. Generally, the quicker you treat cows the better the recovery. It’s all about knowing your cows,” she told those attending the field day.

Graham said both he and Tania had a policy of calving cows on grass.

“We always calve on clean grass handy to the shed. We note cows that have had mastitis before and bring them in earlier before calving to keep an eye on them.”

Both farmers use the Rapid Mastitis Test (RMT), which is a “cowside” test to quickly identify cows with high somatic cell counts.

“Before we touch the cows, we teat spray them and we teat spray the colostrum cows before milking,” Tania said.

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Steve said there is an industry push to encourage farmers not to use the dry cow antibiotic and rely on teat seal alone.

“I’m not willing to get into that debate, but here we have top farmers with the lowest cell counts, still using that combination and setting themselves up well.

“Graham and Tania only treat cows which have a good reaction [to the RMT test] and check on anything else. They have a good memory of how a cow was from one stage to the next and are looking for change.”

A new on-farm testing device called Mastatest helps take the guesswork out of treating mastitis, Steve said. “It’s easy to operate; just fill the cartridge with a mastitis milk sample and place it in the machine. Within 24 hours it tells the farmer which bacteria is causing the infection and the antibiotic most likely to work.” Farmer’s using Mastatest said they liked knowing what they were treating and that they used fewer antibiotics and got better cure rates when antibiotics were needed.

In response to a question about the antibiotic use, Graham said on his farm, “we use quite a lot during calving but throughout milking, not a lot at all”.

Another farmer asked why farmers should bother about somatic cell counts as Fonterra did not pay extra for low counts.

“Cows produce way better when they are all healthy and ready to go when milking starts. We don’t set out to achieve low cell counts, we like our cows and want them to be healthy,” Graham replied.

Steve urged farmers to make the time to pick up cows and calves twice a day. “The more attention you give to the colostrum mob, the better the turnout. Getting cows and calves in early also means milking earlier.”

He also advocated the use of teat spray when stripping and milking colostrum cows, something routinely done on Tania and Graham’s farms. “There is an element of killing bugs, but it’s more about teat condition and cow comfort. A newly calved cow is likely to have dry skin in the udder and teat spray makes the first milking more comfortable.” Graham’s advice is to cover the whole udder when teat spraying.

Steve said healthy teats are the common denominator he has observed among low cell count herds. “If you want to know why 68

‘Cows produce way better when they are all healthy and ready to go when milking starts. We don’t set out to achieve low cell counts, we like our cows and want them to be healthy,’

you have mastitis in your herd, look at the cows and they will tell you why.”

The handout he gave farmers said: “If you assess your cows’ teats once a month you can learn why there is mastitis in the herd and monitor the results for change.

Farmers are encouraged to assess 50 cows for teat skin condition and teat end damage once a month throughout the season as an early indicator of problems.

The targets are: teat skin conditions >95% supple; teat end damage >90% normal.

If any of these risk factors are lower than the target, then farmers should look to rectify possible causes or seek expert advice to avoid mastitis.

The industry’s understanding of mastitis management is evolving and there is increasing pressure on the farming community to reduce the use of antibiotics. Steve’s handout said efficient milking routines can help reduce mastitis.

Culling long-term infected cows is

part of that management, as is drying off strategies. Steve recommends that cows with ISCC (Individual Somatic Cell Count) of <150,000 cells/ml and heifers with ISCC of <120,000 cells/ml can be regarded as uninfected and new infections can be prevented with teat sealant, although strict hygiene is critical when it is administered.

Routine stripping of the herd, (a quarter at every milking) will identify infected cows quicker and minimise the spread of infection.

Ensuring cows have good teat condition all year round is also important. Bacteria from milking an infected cow will contaminate the milking cluster for the next five cows that are milked. Teat spray trials in New Zealand and overseas all show a 50% reduction in the new infection rate if teat spray is mixed and applied correctly.

Healthy teat skin has a fatty acid layer that slows bacteria growth, reducing the mastitis risk. If teat skin is dry, the fatty acid layer is lost, and bacteria will multiply

Ruby White and her mother Tania are fond of their cows, but well aware they are not pets no matter how friendly they become.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

Left: Steve Cranefield, technical manager with AgriHealth of Auckland – healthy teats are the common denominator among low cell count herds.

in the cracked skin. Good teat condition requires the addition of sufficient emollient and ensuring full coverage of all teat surfaces at every milking all season.

Pre-milking teat spraying the colostrum cows will assist to improve milk let-down, improve teat condition, and reduce

bacteria on the teats. Teat end damage from the physical action of the milking machine allows bacteria to grow and enter the teat canal. Adopting efficient milking routines will help reduce the mastitis risk from teat-end damage caused by overmilking.

MaxT (maximum milking time) is a strategy which defers residual milk to the next milking where it can be harvested more efficiently. Cows are milked to a predetermined end point – either to a fixed point or to a set milk flow rate threshold, whichever comes first.

Using the fixed time point, the idea is to estimate when about 80 % of the cows would have completed milking and remove the cup clusters from the remaining 20%.

Research shows the implementation of MaxT can increase the number of cows milked each hour in many New Zealand dairies, with no loss of milk yield and no increase in mastitis or somatic cell count.

MaxT’s principles are based on harnessing basic cow physiology. (Source: Mastitis management and milking efficiency go hand in hand – Steve Cranefield BVS, www.agrihealth.co.nz)

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“No more guesswork. Using Mastatest we know if a cow needs treatment and what drug to use. We’ve reduced our antibiotic usage by 25%.”

Lisa Pike, Waikato Farmer 69

STOCK TECHNOLOGY

Alicia and Mark look at the herd’s data as it comes in.

Ears to the ground Technology in the form of CowManager plays a major part in the operation on the Adams’ Otago farm. Story and photos by Karen Trebilcock.

T

here’s no tail paint on Mark and Tracey Adams’ dairy farm at Woodside near Dunedin. There are no bulls either.

What is there are seven solar-powered routers on fence lines throughout the 140ha farm and all of his 400 cows have orange CowManager tags.

And Mark’s phone goes “moo”, even in the middle of an interview with the Dairy Exporter, to tell him a cow has come on heat.

“It’s a non-cycling too,” he says smiling, checking the graph of the cow’s activity on the phone’s screen.

Mating this year has been anything but normal for Mark and his two staff.

CowManager tells them which cows are 70

on heat, they’re drafted through Protrack and inseminated, with the LIC technician saying all of the cows submitted are definitely on. There are few short returns, if any, as well.

“It’s just taken all of the pressure off,” Mark said.

The technician uploads the mating information on the DataMATE app before he leaves and it arrives in MINDA and then is uploaded in Cowmanager within a minute or so.

Mark can check on his phone which cow has been mated with which bull even before the dust has settled on the tanker track. Submission rates have been about the same as last year but last year he used CIDRs on 15% of the herd.

He’s hoping CowManager will lower his not-in-calf rate, which has stayed stubbornly high over recent years.

Wanting to use short gestation semen over his late cyclers to bring calving dates forward, Mark has been keen to get rid of bulls on the farm for a while.

He tried FlashMates two years ago but it didn’t help and, wanting to make picking cow heats easier, he’s turned to CowManager.

CowManager, supplied in New Zealand

by Senztag for the past seven years, is used on more than 100 farms so far with 20 of them in Southland and Otago under the care of Alicia Keown.

While the hardware comes from Germany, the United States and the

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

Top left: No tail paint is required for mating this herd. Left: The tags are small and fit snugly in the cows’ ears. Above: CowManager Southland/ Otago sales manager Alicia Keown and Otago dairy farmer Mark Adam checks one of the seven routers on the Woodside farm.

Netherlands, its home is the Netherlands where creator Gerard Griffioen employs 60 staff.

“It’s very much run as a family business still,” Alicia said.

“Gerard is a dairy farmer with an engineering background. He wanted a non-invasive way that could monitor cow health and he came up with the ear tag.

“Now he’s started working on similar systems for people too, monitoring things like heart rate and glucose levels.”

She said after four years of development in the Netherlands, CowManager arrived in New Zealand in 2012.

Even though the two countries have very different farming systems, the algorithms it uses can adjust to our grassbased feeding where cows stay outside and walk long distances.

“We’re very much focused on what an

efficient cow is in New Zealand. We’re always looking at the data.”

CowManager differs from other monitoring equipment as it measures the cow’s ear temperature as well as movement and all of that data is captured every 15 minutes.

“Gerard knew that if you wanted to find out whether a cow was sick or not, you felt their ears. A cold ear is a sure sign of illness,” Alicia said. “That’s why he made sure CowManager monitored the temperature of the ear.

“Every hour all of the data is uploaded to the cloud using the routers on the farm and if there is anything that is not the normal pattern of behaviour for that cow, an alert is sent immediately to the farmer’s phone and their computer.”

The app can be installed on multiple phones so staff and even the farm’s vet can

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

see what is going on. Individual cow’s data can be looked at or a herd overview.

Both 3G or 4G broadband works, and if there is a power cut or the internet goes down, the tag can store the information for up to seven days until it can upload again.

The farm is mapped to make sure the routers are evenly spaced so there are no dead spots.

As well, the CowManager software integrates to “every drafter and system you can think of”, Alicia said.

For a 600-cow farm, the cost is about $30 per cow per year until the hardware is paid off and then it’s only a yearly subscription.

The three modules – health, nutrition and fertility – can be turned on and off separately so farmers only pay for what they use.

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Mark tagged the herd with the CowManager tags shortly before calving.

Most farmers use the health module all year, with fertility only turned on during mating and nutrition during transition feeding.

Mark is thinking of tagging his yearlings next year to mate them because it would be cheaper than using a CIDR. “Yearlings don’t have health issues such as mastitis or lameness, but it would certainly be beneficial for mating,” Alicia said.

The tag measures head movement as well as the ear temperature and uses algorithms from the data to detect health problems such as mastitis, milk fever and lameness, as well as rumination and mating heats.

A drop in ear temperature by seven degrees compared with the rest of the herd shows illness, up and down motion shows eating, and side to side motion shows rumination (chewing the cud).

Non-active time shows resting but does not determine whether the cow is lying or standing. No movement for four hours causes an alert.

Increased activity and a drop in rumination show a mating heat.

Mating heats have a heat state scored from one to 12 which helps the farmer determine how strong the heat is and when to put the cow up for AI. “Sometimes you’ll see a cow go up to four and then nothing happens, but other times it will shoot up to 10 or 12 and then you know it’s really on,” Mark said.

But he got caught out at the start of mating when his trough system failed on a hot day.

“We had about 70 cows alerting on high activity which can indicate as being ready 72

for AI. They were walking around searching for water and when we realised what was happening we went back and looked at the premating heats and found out which cows were really on.”

When a cow does not come back on heat following insemination it’s identified as pregnant. If there is another heat a month or so later it shows a potential abortion.

It also picks up non-cyclers for vet checks. Mark had Alicia install the system in July and he was soon appreciating the benefits. After checking his calving cows he could go home and watch on his phone whether a cow got up again afterwards.

“That was really good. Being able to go to bed at night and not worrying.

“One day the tanker docket showed a spike in the cell count and before the next milking there was an alert on a cow for mastitis.

“We treated her and the cell count went back to normal. Instead of having to check every cow in the herd, CowManager found her for us.”

Alicia said for other farmers CowManager had identified metabolic diseases before cows went down and had also alerted on cows with a displaced abomasum.

“It comes up as a health alert and it’s more common than people think. Once picked up it can be treated by the vet.”

The nutrition model looks at eating and rumination times and farmers can compare the data of different groups of cows in different paddocks or on different crops.

“A cow that is eating and ruminating is making milk. It’s an efficient cow and that’s what we want.”

Mark’s cows are mostly grass-fed with

crop in the winter, and he’s keen to start looking at how the nutrition module can help him once mating is over with.

Alicia said the algorithms the software used were constantly updated and system upgrades were automatically installed each month onfarm.

“We’re always talking between Holland and here. Lots of late night online meetings. Until this year Gerard was coming all the time to see how it was working and talking to farmers.”

Alicia is also able to look at her farmers’ data as it’s collected.

“Last year we were speaking with a farmer and at the same time CowManager was reporting an unusual activity on his herd and sure enough the cows had got out and were running down the road.”

During mating she is checking nonreturn rates and is always only a phone call away as well as making regular onfarm visits.

“Farmers can have the system installed at any time of the year but we like to have it up and running at least one to two weeks before say calving or mating, just so the algorithms have time to adjust to the herd and farmers understand how it all works.”

She said farmers with CowManager were starting to get together to compare data and ways to use it.

“We’ve had lots of interest and I suppose it’s like any new technology – farmers want to see how it works for other people before they commit themselves.

“We’re finding one person gets it and then their neighbour and then those down the road.”

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

VET VOICE PHOTOSENSITIVITY

Summer and photosensitivity Words by: Lisa Whitfield Production Animal Veterinarian

ACUTE SIGNS OF PHOTOSENSITIVITY

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Cattle may show subtle signs when photosensitivity is first developing. Look out for signs such as: • Restlessness • Agitation • Tail-swishing • Stamping legs • Head-shaking • Shade-seeking • Redness and inflammation of teat skin.

As signs progress, the cow may become very agitated. She may develop a fever from the skin inflammation. If no shade is provided, she may be lying down and standing up constantly. Closer examination may reveal swelling of white areas of skin, which you can detect by running your fingers over the edge from black skin to white, revealing a raised edge.

f you have been lucky enough to have a break over summer, your gumboot tan may have had too much time in the sun, resulting in quite uncomfortable sunburn. The pain from severe sunburn is mild compared with what cows experience when they suffer skin burns from photosensitivity.

The long hot days will mean summer crop feeding is under way for many, and facial eczema spore counting has likely started in most northern regions.

Facial eczema and brassica photosensitivity are two commonly encountered photosensitivity diseases, and they both have overlap in the time of year that they occur. January through to the end of the warm season is the high-risk period for these diseases.

BRASSICA PHOTOSENSITIVITY Rape and leafy turnip are two species of brassica that are more often associated with signs of photosensitivity in cattle, although any species of brassica can cause it. With summer crop feeding usually starting in January, it is the first suspect for photosensitivity in the New Year.

An unknown compound in the plants results in liver damage, and this damage leads to a buildup of photoreactive compounds in the blood. Sunlight exposure triggers a chemical reaction and leads to the development of skin burns. The liver damage in brassica photosensitivity is not usually permanent, however.

A brassica crop is more likely to cause photosensitivity under the following conditions: 1. Feeding a crop that is still immature 2. A crop that has been droughtstressed.

Crop feeding should be done in a way that allows the cows to get used to the new diet, with a slow build up over at least a week. Cows should all have equal access to brassica crops, so rather than letting

Facial Eczema lesions on the udder – red, painful burnt teats and thickened udder skin. The initial liver damage that resulted in the development of photosensitivity would have occurred a few weeks before.

them go on following milking, give them a grass break first, then move them onto the crop together. Make sure you measure your crop yield so you are not under or overestimating how much the herd is being offered.

FACIAL ECZEMA Facial eczema is a widespread disease in warmer parts of the country. This fungal disease of ryegrass also leads to liver damage, however in this case the damage is permanent. Liver damage leads to skin burns in much the same way as brassica photosensitivity.

Spore counting is the method used to assess the level of risk in pasture. Pasture spore counts of more than 60,000s/g are considered high risk for the development of clinical signs of photosensitivity.

However, unlike brassica photosensitivity which occurs soon after grazing an affected crop, the display of clinical signs with facial eczema is usually delayed by a number of days or weeks, following grazing of affected pasture.

Farms should perform spore counting from their own pastures rather than relying on regional spore counts due to the wide variability in where hot spots occur. Spore counting should be performed on a weekly basis, and zinc should be provided once spore counts are trending above 20,000s/g.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

THERAPY Affected animals should be provided with complete shade shelter to prevent exposure to the sun. Due to inflammation and severe pain associated with photosensitivity, anti-inflammatories should be given, particularly during the first few days. Antihistamine injections, especially for cattle may also make the cow more comfortable.

Cattle suffering from brassica photosensitivity should be removed from the crop and provided with alternative feeds. Often these cows will respond within days of being taken off the crop.

Clinical signs of facial eczema will often take weeks to show outward improvement, but the liver damage is permanent.

Consideration should be given to the welfare of severely affected animals.

• Lisa Whitfield is a Manawatu-based production animal veterinarian.

Scan Me! This QR code takes you to a video of a cow showing signs of photosensitivity after grazing a droughtstressed rape crop.

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WELLBEING SLEEP

Combat the voice inside your head Having trouble sleeping after a busy day? Harriet Bremner has some suggestions for combating fatigue.

Harriet Bremner and Poppy.

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ou get into bed at night and close your eyes, you are exhausted and have been looking forward to being horizontal since 3pm when you really could have slept while you were rolling that paddock but… you can’t switch your mind off. It goes around and around.

Hours later you find you are either still awake or have woken back up to the same issue – your mind going at 1000 clicks.

What can we do about this common problem of adults who are tired yet cannot sleep? It even gets to the point when sleeping pills don’t help much and make you feel a lot worse the next day.

Consequently, all you want to do is sleep at 3pm while you are at work because you have been awake for way too long and this is when you can strike issues on the farm.

Fatigue and making good decisions don’t go hand-in-hand and this is when things can go wrong very quickly, simply because you are tired and your brain is elsewhere and busy, very busy.

In the modern world, we find ourselves living in a constant state of anxiety or flight mode. We are always contactable, there is no downtime, life is just chaotic as it feels, and we don’t take time to simply take a breath.

What is the answer? I recently went to a seminar with Nathan Wallis and Lance Burdett and they talked all about stress, anxiety, breathing and the brain and it all made sense. I also took myself off on a wellbeing one-on-one retreat where I focused on learning how to deal with my grief and trauma in a helpful way other than just being busy all the time to avoid how I was really feeling. Between the two, I have been reminded how incredibly important it is to put yourself first, take a break and breathe.

I am unsure there is a magic answer but

nothing will fix you in the click of your fingers but some simple things can really make a difference to your sleep and your busy brain.

Some simple tips and tricks can help quieten your mind. Some may sound not up your alley but trust me, they work if you believe they will and what have you got to lose?

Worry is something we can most likely relate to on a daily basis so how do we deal with it before it turns into something bigger? Lists. Yes, I said it, lists.

Prioritise what you have to do during the day, and you will be amazed at the satisfaction as you tick off activities as you complete them.

This reduces the feeling of being overwhelmed and gives you a plan to follow.

Humans have been writing lists since way back in the cave man days and this is why we find it natural to still do it today.

Stress is Latin for stretched. Makes sense that when you are stressed you feel you are being stretched too far and that is because you are.

You are able to deal with tolerable stress and come out the other side but toxic stress is bad for you as it has a negative bias and so you need to make sure you don’t turn tolerable stress into toxic stress.

I would start with writing a list in the order you are going to complete tasks with the highpriority ones at the top.

Breathing is also a key factor, before you start the day or start a new job do this simple breathing exercise. It stops your busy mind and stops you feeling overwhelmed and anxious.

Top tip: Breathe in through your nose and then out by sighing heavily – really heavily.

Do this several times and it will stop a negative thought in its tracks.

Another tip to help with worry is to keep hydrated – this also helps to reduce general worry and anxiety.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

In the modern world, we find ourselves living in a constant state of anxiety or flight mode. We are always contactable, there is no downtime, life is just chaotic as it feels, and we don’t take time to simply take a breath.

The voice inside your head has a lot to answer for when it comes to how you are feeling in yourself. This can be very distracting and damaging to overall wellbeing. You need to focus on making the voice inside your head your friend and not your enemy.

Your brain will always automatically choose survival over the sympathetic understanding brain which puts you into flight mode – handy when you are being chased by a bear but not so much when you are trying to sleep or concentrate on the task at hand.

You must consciously tell yourself things that are positive - what you are grateful for in that moment while breathing.

We are wired to worry so you have to make yourself think positively otherwise your voice in your head is beating you up and pulling you down.

Top Tip: If someone comes to you with a worry or something that they are stressed about, you can start the conversation with them, after they have told you what is wrong… “I can see that this is making you feel upset/angry/mad….” This validates how they are feeling and very helpful when talking to them about it.

Top Tip: A 15 – 20-minute walk at the end of the day burns off adrenaline and cortisol. This will help you be more able to calm your mind and sleep more easily. Have you ever wondered why great ideas come to you while you are walking,

showering or doing something calming?

This is because you have worn off the adrenaline which allows your brain room to think more clearly.

TOP TIPS FOR SLEEPING: • Have a really hot shower (after the walk) and exactly 45 minutes later go to bed and close eyes.

• Must be 45minutes otherwise you miss the waves of dopamine hit which helps you sleep.

• Have a small piece of protein before you go to bed like a handful of almonds or walnuts – not a whole steak.

We are naturally wired for two sleep cycles, so it is quite normal to wake around 3am – although not helpful. If this happens you try this breathing technique to switch off that busy brain and you’ll be asleep in no time, but you must be focusing on this alone: • Breathe in through the nose but imagine one nostril has cold air going through it for the first three breaths.

• Swap nostrils and do another three breaths imagining the cold air going in and out the second side.

• The last three breaths imagine cold air going in and out both nostrils as you breathe for three breaths.

Most people are asleep by the third lot. It takes your mind off what you are thinking about and helps put you back to sleep.

If you have suffered trauma or heavy

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

grief in your life then you are going to be living in the emotional part of your brain, just as I have been.

You will require cognitive training to help change the behaviours ingrained in your brain.

FOUR THINGS ARE REALLY IMPORTANT TO LIVING A HEALTHY AND BALANCED LIFE: 1: Socialisation 2: Exercise 3: Sleep 4: Food Combine these with the top tips I have pointed out for you and if you are really keen to change your habits try meditation and yoga – this is amazing for quieting the mind and body and you will be amazed at how refreshed and ready to take on the world you feel. You can just YouTube these or go to your local yoga class if that’s possible.

The first step is recognising your brain is busy. Well done if you have taken that first step and good luck on the journey to finding peace with that voice inside your head and enjoy sleeping again – I know I am.

YOU CAN CONTACT: Rural Support Trust: 0800 787 254 Call or text 1737 at any time Farmstrong: https://farmstrong.co.nz/ resources/

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WELLBEING CHANGE

The development trap

A Chris Neill.

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generation of farm owners made changes to their farming business for the benefit of the nation with encouragement and incentives by government and processors.

We saw Land Development Encouragement Loans funding the conversion of bush and scrub into pasture and Livestock Incentive Schemes create unsustainable stocking rates.

Both schemes had little regard to environmental consequences.

Drives for production to meet developing international demand for commodity products have seen investments in irrigation, feeding systems, large numbers of cows and intensive farming practices.

On the side we have watched exotic pine forests established on farmland - to the detriment of local communities, capital-burning rationalisation of the meat industry, and urban sprawl driving significant rural land-use change and loss of our most productive soils.

These drivers and many more have guided New Zealand farmers to undertake change, in the belief that it would be good for their business and the national economy. There have been some difficult consequences with product prices unable to sustain onfarm investments.

On top of this our wider community are recognising that NZ, our collective whenua, is being adversely impacted by what were accepted practices, and global markets have increasing expectations on the production and environmental standards of goods they will buy.

When we bring this together with drought, floods and Covid-19, there is a sense of general unease in the farming community and resilient people are questioning their ability to stand up and go again.

There’s wariness with the increasing expectations on matters that were previously theirs to determine and uncertainty about what is coming next. A weariness at feeling like the villain for delivering what they believed had been asked of them. A frustration at funding the costs to remedy the past and prepare for the future.

Fortunately, this is not a universal affliction and there is undoubtedly support available for those who know where to find it and are willing to accept it.

It is common in this environment to be

distracted by looking for someone or something to blame. It can mask the view of opportunities and compromise the enjoyment and success of current activities. In many cases perception has become reality, too often fuelled by misinformation, disinformation or the assumed agreement that comes with silence. Most farmers work with a trusted circle of influence. Friends and professionals who help them understand their business and make decisions.

Outside this are those who endeavour to join that circle, some with genuine supportive interest and others promoting their own agenda.

The radar for identifying and addressing those with an agenda is typically strong but there is considerable global evidence to suggest we are being overloaded by influencers whose voice should be reliable. Consequently, our ability to identify and reject is at risk of being overwhelmed.

As part of this, the act of “throwing someone under the bus” is increasingly common.

All-encompassing blame is laid on those not present to ensure the information is accurate or debunk statements that are blatantly wrong. It commonly attacks people rather than addressing the issue and is too frequently used to ingratiate.

It is readily rationalised, occasionally justified and provides temporary relief, but always perpetuates uncertainty, unease and distrust in the community. A community without it would be better informed, clear about issues that need to be addressed and why, and confident about how to contribute to a desired outcome individually and collectively.

There are always questions to ask ourselves and others.

HOW DO WE: • stay focused on issues and solutions rather than personalities • challenge our own and others statements • avoid transferring misinformation and disinformation • check that silence of others may not be acceptance of our point of view • question those who too readily agree with all our opinions • avoid distractions which do not contribute to achieving our vision and goals • surround ourselves with positive people with whom we can achieve great things.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

RESEARCH WRAP ACIDOSIS

No sign of SARA Words by: Anne Lee

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ub-acute rumen acidosis (SARA) is a myth in pasture-fed dairy cows and well-transitioned cows fed fodder beet, Lincoln University veterinary scientist Dr Jim Gibbs says.

Studies making claims that cows fed high quality pasture diets and that well transitioned cows on fodder beet have a high chance of suffering from SARA base the claims on rumen pH readings.

They try to make the link between acidosis and low pH and then suggest SARA is a mild form of acidosis, he says.

“That’s not the case – all farmers should understand this clearly - SARA is not acidosis, it’s not a mild form of acidosis or cows having a “little” acidosis.

“Farmers get told that it’s a point where their cows are sliding towards acidosis – it’s not.

“There is a lot of fake news about ‘acidosis’. Acidosis is rumen collapse – a clinical syndrome where the rumen environment is no longer functioning properly and where pH is only one factor and not even the most important. Low rumen pH is not automatically acidosis.”

Dr Jim Gibbs: Subacute rumen acidosis (SARA) is a myth in pasture-fed dairy cows and welltransitioned cows fed fodder beet.

has been a moving target as researchers learned more about processes in the rumen. SARA is a human-made threshold of pH where there are no clinical effects on the animal.

“Nowadays there wouldn’t be one genuine rumen scientist who would use pH alone as a measure to define rumen dysfunction,” he says.

Instead, rumen osmolarity and redox are included, and with acid concentrations this combination better determines rumen health and function.

‘There is a lot of fake news about ‘acidosis’.

Acidosis is rumen collapse – a clinical syndrome where the rumen environment is no longer functioning properly and where pH is only one factor and not even the most important. Low rumen pH is not automatically acidosis.’

Rumen acidosis starts with excess acid accumulation by carbohydrate fermentation, and production of lactic acid follows.

But true rumen acidosis goes well beyond that and is independent of pH within 12 hours of the first pH insult to the rumen environment, he says.

Gibbs says SARA has been defined by an arbitrary pH threshold which in itself

Osmolarity is the concentration of nutrients in the rumen fluid and if it’s too high rumen bacteria and physiology are destroyed as particles move between areas of different concentration.

Redox – the measure of reduction and oxidation – shows the speed and level of chemical reactions. A ‘good’ redox state shows the rumen is active and healthy and chemical reactions are occurring.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

Gibbs says that so-called “normal” rumen pH levels have been redefined over the years – initially from around pH 6.5 to 5.8 and now even lower.

“Some healthy, productive grain-fed cattle never move above 5.5. As rumen researchers, we have learned to let the healthy cows tell us what is ‘normal’ – not guess a threshold and force it on to them.”

Studies at Lincoln University from 2005-2014 involving 30 cows measured repeatedly for 15,000 hours, showed significant volatility in healthy, high performing pasture-fed cows throughout the day, with most having pH lower than 5.5 at some points every day.

The same has been shown with cows transitioned on to beet with no poor rumen function or other cow health issues recorded in numerous studies, he says.

Gibbs says large data sets have also shown significant variation between individual cows in ‘everyday’ rumen pH. “This is where studies are going today – comprehensive rumen assessments, and larger groups for longer times to flatten individual variation.”

“Giving advice to farmers based on studies with small cow groups is risky small data sets of animals are good to have a look-see, not set guidelines.”

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DAIRY 101 CONCENTRATES

Are supplements right for your farm?

Story by: Karen Trebilcock

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o you’re feeding supplements but aren’t certain if you’re doing it as successfully as you could. Figuring out what is making money, and not costing it, will make sure you, your cows, and your bank manager, are happy.

Feeding the right supplement for the right reasons is important and the gains will be seen in the vat, in the numbers of cows in calf, and the health of the calves when they’re born.

However, there is still a lot of discussion about the merits of grass-feeding only.

I have seen a photo, from memory taken in the United States, of what 18kg of grass drymatter looks like in spring. The pile towers over the cow in the picture. I would love to see it replicated in New Zealand.

We expect a cow to stick that much grass down its throat and ruminate it and on top of that go through peak production, deal with the changeable weather, recover from calving, and get pregnant again.

Supplementing spring pasture with its high moisture content and high protein with energy dense concentrates that take up little space in the rumen and are rapidly digested makes sense to many farmers.

But it’s just not about looking at the metabolisable energy (MJ ME) a supplement contains and costing it on that.

Many supplements also contain protein and that should be factored in as well.

And there are times when it is protein, not energy, you need for your cows.

Of the high energy supplements, maize grain is the top with 13.75MJ ME/kg DM (73% starch) along with 8% protein with wheat coming a close second with 13.5MJ ME (70% starch) and 12% protein.

Barley is just behind them with 13MJ ME (about 68% starch) and 11% protein and sugar beet is 12MJ ME and 8% protein.

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Palm kernel is high in fibre.

Molasses, usually fed with grain in inshed feeding systems, is a byproduct of the sugar industry and is high in energy mainly from sugars. It is also very palatable and can encourage the intake of less palatable feeds.

It has 12MJ ME and 4.5% protein.

Be careful feeding high energy supplements. While grass can be fed ad-lib, with the cows stuffing as much in as they can, don’t do the same with grain.

Energy dense feeds are usually high in starches and sugars, which can cause acidosis. The starches and sugars cause propionic acid to be made in the rumen, which reduces the pH and burns the stomach lining.

Give rumen microbes time to adapt to these feeds and limit how much they can eat.

When summer pasture matures or when

the cow’s diet is mostly made up of whole crop silage, maize silage or poor-quality grass silage, protein dense concentrates is the answer.

Soya oilcake is the Rolls-Royce of plant protein sources with 13MJ ME and 50% protein. It is a high protein and high energy feed – supplying both high quality protein and energy. It is very different from soya hulls, as reflected in the price.

Canola oil cake is a byproduct from the canola (rape seed) oil industry and is 11.5MJ ME and 38% protein.

Dried distiller’s grain (DDG) is a byproduct of making alcohol or ethanol.

It is relatively high in both energy and protein, but low in starch, making it less of an acidosis risk.

It’s also highly palatable, so helps with getting cows eating in spring, when pasture may be low in protein such as in

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

Left: Palm kernel feeding in a paddock for young stock.

Above: A palletised grain feeding system in a herringbone dairy.

dry periods and when high levels of silage are being fed.

You need to know whether the DDG is from wheat or maize as this affects both the protein and energy content. Maize DDG is 12.5MJ ME and 28% protein and wheat DDG is 12MJ ME and 32% protein.

The third class of concentrates are those with high fibre. Because they are low in starch or sugars, they contain less energy per kilogram of DM and are safer to feed in larger quantities or ad-lib in trailers.

Palm kernel (also known as PKE) is the byproduct of palm oil production and has 11.5MJ ME and 16% protein. It is high in neutral detergent fibre (NDF) and short-chain fatty acids, which can be a problem when processing milk. The amount fed has to be limited (usually to 2-3 kg) to avoid FEI grades.

Soya hull pellets (not to be confused with soya oil cake) is 10.5MJ ME and 12% protein, and so contains less energy and protein than pasture. It is more of a concentrated roughage at best, or pasture replacer, than a performance enhancer.

Brewers grains is a beer byproduct – the remains of the barley after brewing. The starch has been fermented (and gone into the beer), which reduces the energy content of the product. It does have a higher protein content because the starch has been removed, concentrating the protein. It can also have a high moisture content, making it difficult to handle and store.

With 11.5MJ ME and 22% protein it is similar to quality pasture.

Knowing the energy and protein of each feed lets you figure out the best value for money. Barley may be more expensive than palm kernel, but if it’s the energy from the barley your cows need, then the maths works.

If palm kernel is $290/t and has 4% starch, then it works out as $7.22 per kilogram of starch. Barley, at $410/t and 55% starch, is a mere 85 cents per kilogram of starch.

But if your pasture is seeding out and mature, starch is not the limiting factor for your cows; it’s protein. Invest instead in a high protein feed and again work out the dollars and cents.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

Always start with your pasture – know what you are feeding your cows and add to their diet what they are not getting from the grass – energy or protein?

Also remember the trace elements such as calcium and phosphorous and all of the rest.

If you’re not sure, ask your cows. Do they look full? Do their sides almost touch the bales in the rotary? What does their poo look like? Are they producing their live weight in milk? Are their blood and liver tests what they should be? Are they getting in calf easily and staying in calf?

But don’t forget your grass is always your cheapest food. Feeding concentrates should make you a better grass farmer, not a lazy one.

Maintain grass quality as much as possible by shifting fences and pregraze mowing.

When your cows can’t keep up with grass growth, make sure surpluses are not wasted but turned into silage or balage for feeding later.

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Phone: 0800 224 782 Email: subs@nzfarmlife.co.nz

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SOLUTIONS What’s NEW? TECHNOLOGY

Collars mean connected cows

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erd improvement and agri-tech cooperative LIC has formed a distribution partnership with Israeli-based Afimilk to market its hi-tech cow collars in New Zealand, supporting a global trend towards ‘connected cows’.

The AfiCollar, worn around the neck, collects data on animal health, wellbeing and fertility. Afimilk is one of the dairy industry’s leading producers of cow behaviour sensors, farm management software and milk meters, and supplies cow collars internationally. Afimilk and LIC were in discussions earlier this year regarding a potential investment by LIC in Afimilk which didn’t proceed.

LIC chief executive Wayne McNee says as sector leaders, the parties remained in contact and recently reached a new agreement regarding Afimilk’s cow collar technology.

“We are working to build an integrated, collaborative technology ecosystem that makes it as easy as possible for farmers to adopt new technologies. Farmers need to be able to choose the technology and products that are best suited to them. Our

role is to ensure that proven technology can integrate with LIC’s existing systems and herd management software into the future.

“The AfiCollars An AfiCollar. are among the best in the world and, we believe, wellsuited to meet the unique challenges of New Zealand’s pastoral dairy environment.

“Our proven work in genomics, reproduction and animal health is enabling farmers to be more efficient and their herds to be more productive each year. Cow behavioural monitoring devices like the AfiCollar will deliver complementary onfarm benefits such as more accurate heat detection and animal health and welfare monitoring.

“AfiCollars will integrate with Protrack, LIC’s farm automation technology, which will allow for increased efficiency and faster, more informed decision-making onfarm.

There is already strong demand for cow wearable technology by our farmers, and for it to integrate with LIC’s farm automation systems.

“The ‘connected cow,’ wearing this technology, will shape the future of the dairy industry and help New Zealand maintain its world-leading edge in precision farming. LIC is looking to work with other leading New Zealand and international technology providers to continue to offer the very best options for our farmers wanting to utilise new technologies coming to market.”

Afimilk chief executive Yuval Rachmilevitz says he is excited to be cementing a new agreement with LIC for the distribution of AfiCollars.

AfiCollar, a robust & effective cow neck collar, is an advanced yet easy-touse technology developed by Afimilk to assist dairy farmers in monitoring cow rumination, eating, and motion, in order to enhance and improve the health, fertility and nutrition of their animals.

• More? Visit www.lic.co.nz/products-andservices/automation/aficollar/

New MOA fungicide

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n the sponsors’ area of FAR’s Crops 2020 event companies were promoting their latest products which, in Corteva’s case, was novel cereal fungicide Questar.

“It’s a completely new mode of action,” R&D manager Bernard Harris told visitors.

Harris said it had market-leading activity against septoria and was best used as a protectant, partnered with a stacked DMI (triazole) such as Kestrel.

A mix was best used in sequence with an SDHI mix at a later or earlier timing.

The active ingredient, fenpicoxamid, was a natural product made by fermentation of 80

Bernard Harris.

soil-borne Streptomyces bacteria and was the first of a new class of fungicides called picolinamides.

As such it had a key role to play in resistance management, providing an alternative to SDHI fungicides.

“Resistance to SDHI’s has developed quickly overseas,” he saId. Corteva says there’s a moderate to high risk of cereal diseases becoming resistant to picolinamides hence why Questar should be tank-mixed with another fungicide with an alternative mode of action.

The Questar label stresses tank mixes must be used immediately with constant agitation.

Harris said Questar is compatible with most plant growth regulators and broadleaved herbicides.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

SOLUTIONS What’s NEW? EXPORTS

Start-up aims to create export opportunities

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freight consolidation service is set to make it easier for Kiwi food retailers to enter export markets and remove the need for intermediaries.

Start-up business Jetkrate will offer a small parcel, freight consolidation service which allows consumers to buy goods from Kiwi businesses and have them shipped to an Auckland address - where they are repacked and sent as one package to any offshore market.

The new service aims to replace the daigou (personal shopper) channel which uses personal shoppers to buy commodities from local retailers and ship them to customers in China as well as reduce the cost of freight for expat Kiwis living overseas.

Varun Khetrapal, Jetkrate co-founder, says the daigou channel is inefficient and lacks transparency.

“There are two major barriers to Asian consumers shopping directly here for products like Manuka honey, dairy, wine and woollen clothing.

“The first is not all NZ retailers ship overseas or if they do, the shipping costs become prohibitively expensive if customers are buying across multiple businesses.

“The new consolidation service removes the shipping barrier and makes it easier to get goods overseas once purchased that allows the retailer to concentrate on building confidence levels across their customer base.”

Khetrapal says they plan to introduce a more formalised structured model, providing retailers with a clear route to this market which has a transparent and robust supply chain.

“The new model we operate under will bring retailers and consumers closer together and will allow them to see the pricing of the products they paid for from the retailer - a feature not common in the daigou channel.

Varun Khetrapal, Jetkrate co-founder

Khetrapal, a former Fonterra executive says the idea for the new service took two years to develop and first came from watching tourists at the airport fill their suitcases with infant formula and milk powder.

“The concept isn’t right for a business like Fonterra which is a B2B marketing body but we believe it does have

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

potential under a business-to-consumer model.”

He says the business is designed to support Kiwi businesses that are too small to deal with international fulfilment.

Khetrapal says their consolidated shipping model could save consumers two thirds of the costs of shipping items individually.

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OUR STORY 50 YEARS AGO IN NZ DAIRY EXPORTER

50 years ago in the Dairy Exporter January As NZ Dairy Exporter counts down to its centenary in 2025, we look back at the issues of earlier decades. 50 Years Ago – January 1971.

RECORD PRICE FOR JERSEY BULL CALF

A four-month-old Jersey bull calf has been sold at a New Zealand record price for a dairy breed calf.

The price of $2500 has been paid by Messrs Breeze and Webb, Silver Falls Stud, Ararimu, for Forest Glen Meteors Pride, a very stylish broken-coloured son of the glamour sire Big Hollow Designs Meteor, Merit Sire, 22 VHC daughters and sold for $16,200 two years ago. The dam of Meteors Pride is Forest Glen Gay Delicia, Excellent, the winner of 35 Championships or Reserves and with records over 600lb fat.

The breeder and vendor was Mr K. T. Taylor, Hamilton, and the sale was negotiated by the Hamilton Stud Stock Department of Wright, Stephenson & Co. Ltd.

FARMING AIDS

Motorised backing gates take time to return to their original position and it is easy to forget to switch them off.

As a result, many motors have been burnt out. This happened to Mr Mel Morrison, of the Waihi District, but it is 82

Cover photo: New Zealand’s dairy industry is the world’s largest exporter of dairy products, selling in around 100 different markets. Our cover photograph was taken in a Honolulu supermarket. Hawaiian housewives prefer New Zealand Fernleaf brand to all others.

unlikely to be repeated. He has rigged up a simple device which turns the switch off automatically.

A pole on a block of wood at its top is attached to the gate. As the gate reaches the end of its return run, the block of wood pushes home a length of pipe, which in turn knocks the switch control to the off position.

GOVT’S POLICY ON NEW QUARANTINE STATION

The three breeds of cattle which have been recommended for importation to the maximum security animal quarantine complex at Somes Island, Wellington, are the Blond d’Aquitaine, Simmental and Limousin.

The breeds will be studied by the Department of Agriculture’s breeding and genetics experts who will decide whether the animals will make a worthwhile addition to New Zealand’s livestock.

“Although overseas experiments and farm production data provide interesting indications of the performance of some of these breeds, farming conditions overseas, particularly in the Northern Hemisphere,

are quite different from those in New Zealand, and wholesale importation of exotic breeds merely because some other country has found them useful is not necessarily the way to go to progressively improve New Zealand animals,” the Minister of Agriculture, the Hon. D. J. Carter, said.

COUNTRYWOMAN’S NEW ROLE (TUI’S PAGES)

In a woman’s mature and wiser years, when she is no longer tied closely to a young family, she could contribute much to society. There aren’t nearly enough women on juries, hospital boards and in Parliament.

I feel we have let the Pankhursts down.

I’m not suggesting we become bannercarrying, vocal, protest marchers, but I do think we are underestimating our influence and power and should be willing to accept more governing roles in all walks of life.

Women can supply an answer to women’s and children’s problems that a man just cannot – Pauline.

• Thanks to the Hocken Library, Dunedin.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

DairyNZ consulting officers

January Events

Upper North Island – Head: Sharon Morrell 027 492 2907 Northland Regional Leader

Tareen Ellis

027 499 9021

Far North

Amy Weston

027 807 9686

Lower Northland

Hamish Matthews

021 242 5719

Whangarei West

Ryan Baxter

021 809 569

Regional Leader

Wilma Foster

021 246 2147

South Auckland

Mike Bramley

027 486 4344

Hauraki Plains/Coromandel

Michael Booth

021 245 8055

Te Aroha/Waihi

Euan Lock

027 293 4401

Cambridge

Lizzy Moore

021 242 2127

Hamilton

Ashley Smith

027 807 3049

Waikato

Get it while it’s hot

Huntly/Tatuanui

Brigitte Ravera

027 288 1244

Sign up for the weekly update on risk of heat stress in your region

Matamata/Kereone

Frank Portegys

027 807 9685

and tips for managing it. Visit dairynz.co.nz/heatstress

Pirongia

Steve Canton

027 475 0918

Otorohanga/King Country

Phil Irvine

027 483 9820

Waipa South

Kirsty Dickens

027 483 2205

Regional Leader

Andrew Reid

027 292 3682

Central Plateau

Colin Grainger-Allen

021 225 8345

South Waikato/Rotorua South

Angela Clarke

027 276 2675

Eastern Bay of Plenty

Ross Bishop

027 563 1785

Central Bay of Plenty

Kevin McKinley

027 288 8238

Heat stress

Bay of Plenty

Dec-Mar Summary

Lower North Island – Head: Rob Brazendale 021 683 139 Taranaki Regional Leader

Mark Laurence

027 704 5562

South Taranaki

Ashely Primrose

027 304 9823

Central Taranaki

Emma Hawley

021 276 5832

Coastal Taranaki

Caroline Benson

027 210 2137

North Taranaki

Ian Burmeister

027 593 4122

Horowhenua/Coastal and Southern Manawatu

Kate Stewart

027 702 3760

Wairarapa/Tararua

Abby Scott

021 244 3428

Eketahuna

Andrew Hull

027 298 7260

Hawke's Bay

Gray Beagley

021 286 4346

Northern Manawatu/Woodville

Janine Swansson

027 381 2025

Central Manawatu/Rangitikei/Whanganui

Rob Brazendale

021 683 139

Lower North Island

Mark and Measure 2021

South Island – Head: Tony Finch 027 706 6183 Top of South Island/West Coast

Get the skills and confidence you need to achieve your unique version of personal and business success.

Registrations are open for DairyNZ’s Mark and Measure business

Nelson/Marlborough

Mark Shadwick

021 287 7057

West Coast

Angela Leslie

021 277 2894

Canterbury/North Otago

course for contract milkers, farm owners, and sharemilkers. Taupo

Regional Leader

Rachael Russell

027 261 3250

18-20 May, West Coast 29 June to 1 July, and Queenstown 15-17

North Canterbury

Amy Chamberlain

027 243 0943

June 2021. Visit dairynz.co.nz/markandmeasure

Central Canterbury

Alice Reilly

027 3798 069

Mid Canterbury

Rachael Russell

027 261 3250

South Canterbury

Heather Donaldson

027 593 4124

North Otago

Alana Hall

027 290 5988

Discussion Groups

Southland/South Otago Regional Leader

Ollie Knowles

027 226 4420

Interested in farm systems, reproduction, progression, pasture

West Otago/Gore

Keely Sullivan

027 524 5890

management, budgeting, people management, or milking smarter?

South Otago

Guy Michaels

021 302 034

Northern/Central Southland

Nicole E Hammond

021 240 8529

Eastern Southland

Nathan Nelson

021 225 6931

Western Southland

Leo Pekar

027 211 1389

We hold a range of different discussion groups on specialist areas of interest as well as other topical field days and road shows around the country. Find out what’s on near you at dairynz.co.nz/events or phone your local consulting officer.

Dairy Exporter | www.nzfarmlife.co.nz | January 2021

Z

0800 4 DairyNZ (0800 4 324 7969) I dairynz.co.nz WITH DAIR

YN

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It’s taken generations to build New Zealand’s genetic wealth.

Your share is right here.

Farming and science are an inseparable partnership. You put in the hard yards on the farm, we continue to make discoveries in the lab.

Since 1994, LIC has invested over $78 million in genomic science to improve genetic gain and productivity. Together, we’ve built a bank of incredible genetic wealth which you as dairy farmers share. Confidence in the science is growing and the use of Genomic Sires is expected to exceed 1.4 million inseminations. Our drive to achieve better never stops and our latest breakthrough with Single Step Animal Model has improved genomic prediction accuracy by 8% - enabling you to make faster improvements to your herd’s breeding worth and profitability. Use LIC’s Genomic Sires to take your share of the genetic wealth built by shareholders for over 30 years.

KINGST_1423_NZDE_A

Talk to your Agri Manager about utilising your share, right now.

There's always room for improvement 84

Dairy Exporter | www.nzfarmlife.co.nz | January 2021