High MS/ha, high EBIT, exceptional operating profit margin and return on total assets led a Kereone family to the finals of the 2020 Dairy Business of the Year Award. Elaine Fisher has the story. Photos by Emma McCarthy.
Nitrogen and phosphorus leaching on Greenacres, the Kereone farm owned by Fiona and Graham Pickett and their son Brad, has dropped significantly, largely thanks to the new 2000m² composting barns completed earlier this year.
“The barns were commissioned in January and the cows were housed from June 1st twenty-four hours a day seven days a week. As they calved, they went out to pasture,” says Brad, who
with his parents, was a finalist in the 2020 Dairy Business of the Year (DBOY) Award.
The family farming business performed well in the awards even though the benefits of the barns were not recorded in the score sheet. Most significant was the achievement of 2110kg milksolids (MS) per hectare and earnings before interest and tax (EBIT) of $9,159. Brad puts those figures down to the quality and volume of the milk from the Jersey herd, the farm’s irrigation system, the payout from Tatua Co-Operative Dairy Company, and the high value of the land. The DBOY report said Greenacres’ profit performance is in the top 25% quartile of the entrants:
“Your farming business achieved an exceptional Operating Profit Margin (49%), well done! This means you retain a high proportion of your income as profit, enhancing business resilience.
“Your Return On Total Assets (5.5%) is strong, based on high production/ha combined with a high milk price, and good cost control. This is despite having a very large capital base due to your land and share value.
“The very high homegrown feed/ha (14.7t) on milking area is helped by irrigation.
“Exceptional milksolids production (510kg MS/cow) as a % of liveweight without resorting to expensive concentrates to do it.
“Compared to the benchmark, your business has above average assets per hectare. Income is at the high end of the top 10% which is a very good achievement. If costs are well-controlled, then this is a very good position.”
Graham and Brad say the key to their business success is the people they work with. “It is important for us to surround ourselves with the right people. We used Headlands consultant Bill Rys, Anexa Vets, and breeding mentors.”
The barns are a big investment but one that both father and son say is essential for the future economic and environmental sustainability of the farm.
“I think having barns may well become a cost of compliance for farming in future. We invested in the barns because, with two families to support on this farm, we want to retain milk production, but we also wanted to protect the environment. The soils are heavy clay, which is another driver for building the barns. We used to winter cows off-farm during the dry period: with the new infrastructure we are now able to keep the herd at home.
“Our N leaching at around 80 odd kg/ha/yr was high, and we got it down to around 50 and expect to halve that again thanks to the barns. P loss is also down by 30%.”
Careful management of effluent application across 40 ha of the property, and the introduction of the plantain patented variety Ecotain, has helped bring nitrogen (N) numbers down.
“Its effects are not yet recognised by Overseer, but it makes the cows urinate more frequently, which means N is excreted in a more dilute form over a bigger area.”
Keeping and feeding the cows in the barn from July to August does mean more work for Brad and Graham, the farm’s only staff, but Brad believes the benefits outweigh that. “We try not to create more work and won’t use it all year round, but in the summer it might be useful to give the cows some shade as, because of our centre pivot irrigation, there’s no trees. In autumn we will feed the cows in there too and adopt an on/off grazing type system, where the herd will spend time off the pastures during autumn months.”
Building the barns may be ahead of the game but innovation is something of a Pickett tradition. Graham installed one of the first irrigation systems in the district around 20 years ago, and it’s still in use. “There were few irrigation companies in New Zealand back then, and Dad had to import most of the parts.”
Fed by an onfarm bore, the pivot irrigator machinery needs regular maintenance because of its age, but has more than paid for itself by making the farm summer-safe. It has also been adapted to carry a second line of effluent irrigators, with buffers to ensure they don’t spread effluent into or near drains.
Greenacres has been in Brad’s family since his grandfather, Stan Pickett, bought the land in the late 1940s. “Previous to that my great grandfather Frank A Pickett grazed heifers here.”
Almost totally flat, the farm, which has 58ha of effective land, is in the Kereone district close to Morrinsville. The site of the walk-through shed from the 1950s can still be seen on the property, but today Brad milks the herd of 240 Jersey cows through a 20-a-side dairy.
Calving in 2020 started on July 15, but with the cows housed in the barn that will allow calving to be slowly brought forward. With good grass growth thanks to summer irrigation, Brad keeps milking until May 31.
While the irrigation helps grass growth it also fosters unwanted paspalum. “We are not quite Northland in terms of paspalum growth, but it loves our soils and the irrigation.”
Getting rid of the weed is a constant battle, which is being won gradually by spraying out and planting an annual pasture to break the paspalum cycle. Pasture renewal includes replanting with tetraploids, and Brad says with high palatability it’s easier to get residuals. “We are also promoting clover growth with the application of sulphur. Using tight, fast grazing rounds in summer is helping control paspalum, which is now found on probably only 15% of the farm.”
While no crops are grown on the home farm, maize is grown on a support block, helping to keep the cost of feed down. Maize was used this winter for the dry period as part of the total mixed ration diet. Concentrate in the form of hominy, tapioca, canola, palm kernel (all non-GMO as a Tatua requirement) is also brought in.
Like the land, Jerseys have been part of the Pickett family tradition too. “I’m not so keen on crossbreeds but I like the look of all pure-bred cows. It’s great to see a paddock of Ayrshires, Holstein Friesians or Jerseys, which go back to the roots of dairying.
“However, Jerseys suit our heavier soils better than most other breeds. They can easily produce 100% of their liveweight with not too much pushing, and have a good temperament. Over the past four years we have extensively used overseas genetics, focusing on larger-framed animals, welding on udders and good components while maintaining strength, and we are extremely happy with the results we are seeing.”
Since Brad returned with wife Rebecca to live and work on the farm seven seasons ago, he has started a register of their cows, working towards pedigree status. Joining his family on the farm was not a foregone conclusion for Brad, who completed a civil engineering diploma by correspondence while working off the farm for eight years.
Rebecca also has a farming background and worked for LIC until the couple’s children, five-year-old Kennedy and two-year-old Stevie, were born.
Now protecting the future of the land, the farming operation and the incomes of both Pickett families is Brad’s goal. It was among the reasons for entering the DBOY awards.
“We have filled in the forms and got the report three times and this is the second time we have entered the awards.
“I’d recommend getting the report and entering as it’s a lot more detailed than DairyBase and drills right down into your data, so you can not only compare yourself with others but also compare your own performance year on year and season to season.
“The biggest thing we got out of it was to see exactly where costs were going and areas to try to tighten up where we can. Our costs are not as high as others so maybe we are doing ok, but there’s always room for improvement.”
Owners: Brad and Graham Pickett
Area: 60ha – 58ha milking platform
Cows: 240 Jersey cows
Effluent irrigation: 40ha
Effluent pond: 80 day storage
Supplement bought in: Concentrate: hominy, tapioca, canola, palm kernel, also maize
Farm dairy: 20-aside herringbone
Barns: 2000 sqm
KEY PERFORMANCE INDICATORS
Milk production: 510kg MS/cow, 2110kg MS/ha
Return on capital: 5.6%
Operating profit margin: 49%
Operating profit: $9159/ha
Cost of production: $4.68/kg MS
Operating expenses: $4.34/kg MS
Pasture harvested: 14.7t DM/ha
Pasture % of feed: 68%
Labour efficiency cows/FTE: 169
Environment Score: 7.3/15
HR Score: 9.8/15