On the Oakes’ farm, carrots are not a go-er but 3-in-2 definitely is, and James Oakes has the numbers to prove it. Jackie Harrigan explains.
James Oakes says he has new ideas all the time – but 90% of them are thrown away by the end of the day and 99% within the week.
Having a good set of budgeting skills means the Taranaki dairy farmer can quickly run the ruler over new ideas and discount them or take them further.
“Our motivations are family and lifestyle,” he said at a recent SMASH field day in Stratford, “and that’s what we measure everything against.”
James and Ashleigh Oakes have four children – boys Henry (8), Payton (6), Kyan (4) and five-month old daughter Emersyn – and James values time spent with the children, helping Ashleigh and supporting and coaching the children's sports and activities.
He told the Dairy Exporter he measures his lifestyle by how much time he has available to spend with family and to watch rugby and cricket during the day.
At the end of their first season on their 320-cow, 135-hectare dairy farm at Midhurst, he and Ashleigh questioned their work/life balance.
“I directly compared our time off with our urban siblings and friends and thought ‘would they work these hours?’ ”
Reassuring questioners that his friends are building equity at the same rate that he and Ashleigh are, James says it is important to the couple to have a similar quality of life with similar opportunities for time off the farm and with the children if they want it.
Their big change for this season is the shift to 3-in-2 milking for the entire season, which is helping them tick those boxes, all with just a $10,000 reduction in milk income but an overall increase in profitability.
“We have always done some 3-in-2. In February 2019 we moved to 3-in-2 to finish the season to cover the feed shortage, but milking at 5am and then 7pm made it too late – we weren’t happy with it.”
In January 2020 milking times were changed to 5am and 4.30pm, which James says worked out much better. He enjoyed being able to do more and pick up the kids every second day after the midday milking.
In July they brought on a new staff member – Tony Smith, who had been working long hours and was looking for a lifestyle change to spend more time with his children – and promised they would start 3-in-2 in December, but then thought why not look at doing it full-season?
“We started breaking it down and worked out it would cost us $2000 for August and September, and a further $18,000 for October to December – so $20,000 less than the season before when we already had done 3-in-2 for half the season.”
“But when I adjusted for the $50 shed cost per day, including power, rubberware, detergent, teat spray, etc to run the 40-a-side herringbone shed, and the reduced costs from less lameness, better in-calf rates and better animal health, it looked like a loss of only $10,000 from a 4% drop in production – and I didn’t think $10,000 was all that much for what we were getting.
“I ran through it with the bank manager and the DairyNZ consultant and with Ashleigh – in fact I talked it through so many times in the end she said ‘Just do it’.
“Our strength is that I do 90% of the books and really monitor the budget spreadsheets, checking weekly or fortnightly, so the bank manager is really happy to talk through scenarios because I really know exactly what's going on.
“It's early days but we are really enjoying it and it's taken lots of the stress and grind out of farming.”
The cows are very settled too, James says. The gate latch goes off at 5am and they either go to the milking shed or they go and get fed.
So milking starts at 5.30am, followed by 4.30pm afternoon milking and then 11am following day. In the spring he and Tony alternate starting at 7am or 8am (on the 2nd day), and for the rest of season both start at 8am. Ali Mattock works for them as a weekend / holiday cover milker.
CHANGING IT UP
Other system changes the Oakes made included dropping cow numbers by 30 cows and dropping imported feed from 312 tonnes to 100t, effectively going from 16.7% and System 3 down to 5.6% and System 1.
They invested in a new effluent system to spread the effluent further and grow more grass.
They also purchased a new silage wagon that was 2.5 times bigger than the old one, because with lower cow numbers, James says, they will make more silage and feed more in the spring, which they didn’t have time to do in the past.
“We have time to do it now and so we are feeding more silage more efficiently and making more money from less cows.”
The drop in cow numbers and imported feed has also improved their GHG number, dropping from the 30th percentile down to the 20th.
“So we are now more environmentally friendly and more profitable.”
Adding Allflex cow collars onto the herd was a large financial cost but is working really well.
“I can just look at my phone and see what the cows are doing,” James says.”The collars have picked up lameness, mastitis, milk fever and cycling, judged on the cows walking and eating activity.
James’ only complaint about the changes they have made is that they are struggling to figure out which change has made the biggest difference – benchmarking against the season before is tricky because they changed so many things at once.
A RULER OVER THE FINANCES
There are three kinds of kids – the spenders, the savers and the traders, and James Oakes admits he was the kid who understood market forces from an early age.
“We used to travel to Wanganui each year for the Taranaki/Wanganui rugby clash, and a highlight was being able to fill our pick’n’mix punnets from the lolly shop – jam in as many as we could.
“I would wait until all my siblings had eaten their lollies and then sell them mine – that was a start of the trader instinct.”
Since then James, who achieved degrees in both agriculture and business at Massey University (and says the business degree was probably the more useful for him), has been trading cows and cattle to make extra money and get ahead.
“Dad gave me my first cow when I passed School Cert agriculture and I traded cows through school and Uni – even when we were overseas in Scotland and I was playing rugby we were trading cows at home.”
The GFC hit when the couple were in Scotland, leaving them with lots of cows worth “zero”, James says, but they decided to farm their way out of it, managing to sell a third and lease out a third. They kept the other third, forming the basis of the 100-cow herd they milked on the small farm they leased for three years on arrival back in NZ in 2010.
“We traded lots of cows – selling four herds in three season – because the demand was there from the South Island, so we went for it.”
Next step was a 200-cow lease farm for four years, with the $3-90 and $4.40/kg MS payout.
“We made money and made it work. It was a real challenge but we came through it unscathed, without more debt, which showed that we could be really conservative when we needed to be.”
In 2017 the opportunity came to buy 85ha and lease a further 85ha.
“It took a lot of budgeting and working with our advisers – my father-in-law, father and brother are our main farming advisers.
“When we were trading livestock we took risks, but now we have the children we are more risk averse.”
While they have never had a five-year plan on the wall, James says they are always thinking, exploring and bouncing new ideas off each other.
“We have had some crazy ideas along with more plausible ones. We looked at having no full-time staff, looked at ACRs but it didn’t really suit our family.
“Last year I grew a really good crop of carrots in the garden, so I thought we should do that, talked to the rep, did the research, but it wasn’t a goer so I chucked that idea out pretty quickly.
“Everything goes under the ruler of: does it fit our values – fit with the family, the lifestyle, what impact does it have on profitability?”
STRENGTHS OF THE OAKES’ OPERATION:
- Really strong link to values for any changes made – adapting their farming system to how they want to live
- Ability to quickly analyse scenarios – run the numbers on the changes before embarking on change
- Getting advice and feedback from trusted advisors, including Ashleigh – great to bounce ideas around
WHAT 3-IN-2 MILKING BRINGS TO THEIR WORK/LIFE BALANCE:
- Every second day James and Tony finish work at 1.30pm
- Breakfast with the kids every second day and an 8am start
- Helping get the kids ready for their day every second day
- Coaching two touch teams
- Helping out with kids’ activities after school – swimming, cricket, touch,
- Poker night online with friends, catching up with mates, staying up till 11pm
- Christmas - lunchtime milking enables mornings with the kids
- Watching cricket at Pukekura Park during the day, with a few beers
- Reduced working time from 60 hours to 45 hours/week
- Improved work output – always fresh, one starts at 7am, other at 8am, everything is done faster.
- Cow BCS has improved, up to 4.1 in October, improved cow health, and production targeting 400kg MS/cow (producing 2kg MS/day in October).
- James and Ashleigh Oakes
- Manganui Road, Midhurst, Taranaki
- 320 cows (2020/2021) 350 cows (2019/2020)
- 135ha + 35ha adjoining leased runoff
- 400kg MS/cow
- 40-aside herringbone
- No feedpad