Words by: Sandra Taylor
By adding value to the dairy support package they offer, Waikato farmers Phil and Megan Weir are generating returns on a par with a bull beef system.
For the past three years, the couple have farmed 250 hectares (the cattle platform is 180ha) in Te Pahu on the slopes of Mt Pirongia, in the heart of Waikato dairy country. They run breeding ewes, trading cattle and dairy heifers and have developed a grazing package that generates a premium and delivers a product that benefits the client’s dairy operation by ensuring they have well grown heifers entering the herd.
Phil, who is a Nuffield scholar and Beef + Lamb NZ farmer council member, says they have been grazing heifers for dairy farmers Craig and Kylee Mora for three years.
Their relationship has grown to one based on trust rather than formal contracts and an understanding that the couple will guarantee the heifers hit their pre-mating and calving target weights, irrespective of seasonal fluctuations in growth rates.
The couple farm on a mix of owned and leased land and because they stretched themselves financially to buy land, they appreciate the surety of cash flow offered by dairy support. But after one year, they knew they needed to generate more income from the heifers and to do this they had to add value to their existing grazing arrangement.
“Dairy heifer grazing is great for everyone in a good season and terrible for everyone in a bad season. In a bad season, the sheep and beef farmer can’t afford to feed the heifers so they don’t reach their growth potential.”
What Phil and Megan have tried to do is remove seasonal variability and generate enough income to ensure the heifers leave their farm at 90% of their mature liveweight (450-460kg) and are ready to enter the herd as well-grown, high producing cows.
Phil says under the traditional model, the grazier is making money when feed is cheap but is in danger of losing money when feed is expensive, as was the case last season. By charging a premium – $10.50/ head/week for calves from December to May and $14.50/head/week from May to May – the Weirs can have a stock policy that allows the heifers to meet their growth targets.
“We’re just focusing on what’s important.”
With the help of a consultant, they carried out Farmax modelling to compare dairy grazing with other enterprises such as bull beef.
“That’s how we set the price so that it is equivalent to a beef system from a profit perspective.”
The bulk of the calves arrive on the Weirs’ farm on December 1 weighing about 140kg and leave 18 months later in May. Another small number of calves arrives in May.
The Weirs agree on an animal health plan developed by the Mora’s vet and they are responsible for executing it.
“The only treatment we don’t do is zinc boluses because it can be upwards of 550 animals that need treating. When the need arises, they employ a vet technician to do the job, although Facial Eczema hasn’t been an issue for the past two years.”
The layout of the farm, with a road through the middle, means the Weirs can run dairy grazers on one side and trading stock on the other, so biosecurity risks are minimised.
The heifers are grown out on ryegrass and clover pastures, but to get through the drought last autumn, the Weirs grew kale and bought in palm kernel.
Phil says they had raised the grazing price prior to the drought and this enabled them to spend the money on the palm kernel to help maintain growth rates.
Autumn is always a pinch time for the Weirs and next year they will be using home-grown maize silage to fill any feed deficits.
While they would use palm kernel the price can get too high, and with maize they can control costs. If they have a fantastic season and don’t need the crop, they will sell it as standing feed.
They also make grass silage out of spring surpluses for use in autumn.
All stock are wintered on pasture, and the heifers are run on a rotational grazing regime with Phil applying techno or cell-type grazing principles.
“One of the challenges is that we don’t carry enough stock over winter to fully utilise feed in spring, so we buy in trading stock in the autumn and early winter with the plan to have these trades off-farm by Christmas.”
Initially they were weighing routinely, but as trust has been built between Phil and Megan and Craig and Kylee, this has stopped. Instead they have identified critical dates and these include six weeks after arrival, a month before mating so they can ensure all the heifers will be at the 300kg mark at mating, and their leaving weights.
They have learnt that it is difficult to put weight on the heifers over late summer and autumn, hence the use of high energy feeds such as maize and palm kernel, but also the focus on maximizing growth rates over the spring and early summer period.
While most of the heifers leave in May, the Weirs hold onto a few for an extra month which is an arrangement that suits both parties.
Phil says there are hidden costs with dairy grazing such as the labour costs associated with feeding out, but similarly bulls have hidden costs, especially in damage to infrastructure and equipment.
From a health and safety point of view, the dairy heifers are a better fit for the couple who run a family farm of which their three young children are a big part.
Well-grown heifers benefit the dairy business
Dairy farmer Craig Mora says they simply cannot afford to have under-grown heifers entering their herd because they cost them so much through poor lactation and high empty rates. For this reason, they are willing to pay a premium for grazing and invest in the future performance of their herd.
“Under-grown heifers just fall out of the system.”
Such is the value that Craig and his wife Kylee place on heifer grazing, that they suggested Phil and Megan work out the true cost of heifer grazing, including opportunity costs, and base their rate on that. This allows the Weirs to do the best job they can.
“Too many graziers don’t base their price on anything.”
Craig acknowledges that it is very hard to find good grazing and they value the Weirs’ ability to produce well-grown heifers.
“We just couldn’t afford for them to switch to bull beef.”
Their relationship is one based on regular communication and mutual trust, and as both parties are at similar ages and life stages this has helped build a more personal relationship.
Craig says they are always more than willing to help Phil with the heifers if required and at artificial breeding time Phil will yard the heifers while they carry out the insemination work.
The Moras play their part in the relationship by delivering well-grown (average 140kg) calves to Phil and Megan and they will hold back lighter calves and grow them out for an extra five months before sending them off to join their herdmates.
At a value of around $1000/heifer, Craig and Kylee like to keep an eye on their future milking herd and they cannot understand dairy farmers who send their heifers off to grazing and don’t see them again until they return.
Craig admits that when they first entered into a grazing arrangement with Phil and Megan they were weighing the heifers a lot more than they are now, but as the relationship has developed, so too has trust and they know the heifers are being fed well every day and will meet their target weights.
Craig feels they are now in an arrangement that works well for everyone.
He admits that there will be fluctuations in profitability due to seasonal variability driving the price of feed up or down, but on average it needs to be fair so that both parties benefit from the arrangement.
- B+LNZ works alongside DairyNZ running dairy heifer raising workshops and offers a range of feeding, nutrition and management resources on its website.