Simple, flexible system key to cost management

Keeping a lid on costs and growing quality pasture is key to coping.

Keeping a lid on costs and growing quality pasture is key to coping with volatile payouts, say West Coast farmers Michael and Christine Hart.

We have always managed to have a reasonable profit, high payout or low payout, and we want this to be sustainable year-on-year," says West Coast farmer Michael Hart.

He and his wife Christine bought their 102ha Totara Flat farm from his parents in 2000. Previously 50:50 sharemilking on two farms, Michael helped convert, they sold half the cows to take over the farm his family moved to in 1980 from Taranaki.

"Dad was a good farmer, the fertilised levels were high and all the grass was pretty good. It's always generated a nice profit and that's through low costs and growing plenty of quality pasture. We try not to use too much urea -- we'd rather get the clover to put in the nitrogen because we can do it for free that way."

Michael says the area's first European, explorer Thomas Brunner, noted Totara Flat as one of only two places where natural pastures grow. "It's always wanted to grow grass," he says.

"If you can get the quality and quantity right in your pastures and use the cows to harvest it, this feed is low cost and it's our country's competitive advantage."

Michael's a fan of DairyNZ's Spring Rotation Planner to help get feeding right. "It helps plan out the important grazing round, from when you start calving to when your grass grows quick enough to feed all your cows fully. It's a fabulous tool."

And he gets hugely valuable information from the four West Coast monitor farms, both from weekly growth data and the end-of-season field days.

"It's been quite a revelation to some farmers that the higher producing farms are not necessarily the most profitable. Having good sound data is worth its weight in gold."

SYSTEM DECISIONS

When the payout's higher, Michael will buy in some extra feed to extend milking days, but he's wary or getting locked into a system requiring expensive infrastructure to maintain and purchase.

"Once it's there, you've basically got to use it to justify the cost. We may waste a wee bit more because we just feed out palm kernel in bins and buy in a bit of extra baleage, but our infrastructure cost is very low."

As well as concentrating on pasture quality, Michael grows winter and summer crops, each taking about 4 per cent of the milking platform. He looked at growing fodder beet but after crunching the numbers decided to stick with swedes.

"We can grow 20 tonnes/ha of swedes so it's more cost-effective and, if we're short, to buy in a bit of palm kernel."

FARM IRRIGATION

The farm is irrigated by a K-Line system that draws from a pond, so Michael has no trouble growing grass.

Adding summer turnips to the diet extends the round from 21 days to 30, usually to late January, when production drops to between 1.45kg MS/day and 1.5kg MS/day.

At this time of year, he switches to a 16-hour milking cycle (three milkings per 48 key to cost management hours) at 5am and 8pm one day, 2pm the next. On every second day, plenty of time is available for off-farm activities.

"The production drop-off is minimal and we can suddenly increase our grazing round and get that out to what we want.

Your costs come down, you're running the shed less and the cows have one less trip to the shed every two days, so their condition improves," says Michael. "In our situation it's a win-win."

SHAREMILKERS ON BOARD

Early last year Michael and Christine moved up to Nelson with their son Alexander and employed contract milkers Paul and Doris Awaikera. They're now in their second season as lower order sharemilkers.

Michael spends about six days a month on the farm.

That's meant a few changes and now the young stock that used to stay home are grazed off-farm.

"We're milking more cows and we're buying in a bit of extra feed, should it be required for those extra cows. When we ran the farm, our production was 960kg MS/ha, now we've got the sharemilker on, we're doing about 1100kg MS/ha."

Before he had sharemilkers, Michael would cut back on cow numbers to reduce the need for bought-in feed in low payout years, however, he doesn't feel he can do that quite as aggressively now.

"If I was screwing down my tight management, I wouldn't do as many kilograms of production, but to me that would be unfair on the sharemilker because he gets paid on kilograms of production," says Michael. The relationship is about communication.

"You have to find a happy median -- we've got to be happy and the sharemilkers need to be happy but you can't go too much one way. It's just trying to strike that balance."