Thursday, August 11, 2022

Iwi make a success of return to the land

Land once taken from them is now back in the hands of iwi who are looking after it for future generations while making it more productive and sustainable.
Iwi-owned Pouarua Farms chief executive Jenna Smith says the land is a taonga asset for its people and will never be sold.

Pouarua Farms takes a long-term outlook when it comes to managing the land. For the five iwi who own the Hauraki Plains’ largest dairy platform, that means making decisions that will sustain the land and create an intergenerational asset.

The farms are a taonga asset for their iwi and will never be sold, says chief executive Jenna Smith.

“The outlook’s further than five or 10 years. We’re looking 50 to100 years and it’s about sustaining the land, being productive and keep it returning to the people for generations to come,” says Smith.

The farms, totalling 2,100ha, are jointly owned by Ngāti Maru, Ngāti Paoa, Ngāti Tamaterā, Ngāti Tara Tokanui and Te Patukirikiri.

The farms lie within the Māori land blocks known as Ngarua, Waitakaruru and Puhangateuru and are named after the two sticks that were once used as location markers for these blocks.

The Waitangi Tribunal confirmed that the iwi of Hauraki suffered raupatu by the Crown and were marginalised in their own rohe, being among the most landless of iwi in the nation.

Pouarua Farms were returned to the five iwi in 2013 in the largest on-account Treaty settlement ever made by the Crown. The iwi used the money from the settlement to purchase the farms from the Crown.

“They had to buy their own land back,” Smith says.

Prior to that, the farms were run by Landcorp and from 2013-2019 were run in a sharemilking arrangement with the Crown SOE.

For the past three years, the farms have been run by their iwi owners, overseen by a board with iwi elected members.

That board is chaired by Paul Majurey, and its other directors include Tainui Group Holdings chair Hinerangi Raumati, John McEnteer, and Rick Braddock.

When Smith came into the chief executive role in April 2019, she set about leading the ownership transition.

Pouarua Farms are run by their iwi owners, overseen by a board with Iwi-elected members. Chief executive Jenna Smith and operations manager Stuart Telfer oversee the farms.

She began by examining the land’s capability and deciding what was the best use of that land and how the income could be strengthened, given that it is a cashflow business, she says.

Above all, the goal is to create food from the land – and that does not necessarily mean dairy farming.

“A lot of it started with looking at best practice for the land and what was working and we tied that into income diversifications to create a more resilient business.”

That has resulted in a section of the land being converted to a blueberry plantation, using beehives to supply Comvita with Mānuka honey and using Wagyu genetics to breed dairy beef from their herd which are not being mated for replacements. These calves are then sold to Firstlight for their beef.

Part of another dairy farm was also converted to a beef finishing farm that buys in young cattle to finish at 18 months to two years of age.

The blueberry orchard is the most recent diversification, with the plants put in the ground in the winter of 2021 and the first harvest planned for the end of this year.

Smith says about 85% of that crop will be exported.

“We have to look at whether we can do dairying sustainably but also if it’s financially viable. Some of our dairy farms are propping up our other dairy farms and long term I would say that while we possibly won’t reduce cow numbers further, we will look for efficiencies in reducing the amount of separate farms, and what area they are farmed on.”

The farms required extensive infrastructure development when the iwi bought the farms and have undergone extensive redevelopment.

Nine new Kliptank effluent systems have been installed over the past three years at an approximate cost of $3 million, along with low application hard hose irrigators to spread the effluent out.

Blueberry plants under cover in paddock
The blueberry plants were put in the ground in the winter of 2021 and the first harvest is planned for the end of this year. About 85% of the harvest will be exported.

The systems are all GPS monitored and equipped with fail-safe technology letting the farmers know where the effluent is being applied and alerting them if there is a mechanical fault.

Smith says the Kliptank system is used because the farms all sit on peat soils that carry a risk of leaching nutrients. Having the tanks above the soil stopped the effluent from potentially leaching into the soil from the ponds.

The tanks can also be disassembled if required.

Staff housing was also improved and all 29 houses meet the Government’s Healthy Home standard. The housing is monitored by an external housing manager, meaning regular and timely inspections and maintenance.

A new 54-bail rotary dairy shed has been installed on the largest of the farms, Farm A. The modern new shed uses Protrack and is fully automated and sits on a carbon composite platform rather than a traditional steel platform.

Its lighter weight means reduced wear and tear on the platform’s rollers and reduces the necessary load on the base, reducing the cost.

The rest of the farms have had lower-scale upgrades with automation and other new technology retrofitted into the shed to modernise them.

The 4,700 cow herd was also fitted with Allflex collars for heat detection and for monitoring animal health.

Another of the farms was re-configured from a 500ha farm milking 1,400 cows through one shed to two separate farms with the second farm converted to the drystock block, and the herd numbers reduced to 850.

The reduction is part of an overall herd reduction from 5,100-5,200 to 4,700 cows.

Smith says having such large numbers was inefficient and not reaching the farms’ productive potential.

Dairy cows
The 4,700-cow herd across eight farms produced 1.62 million kilograms of milksolids last season and the target for this season is 1.65mkg MS.

“We felt that with the seasonal pressures and climatic pressures the land wasn’t supporting itself so we saw that as an opportunity to create that drystock block.”

The higher stocking rate under its previous owners required a more intensive system, requiring high feed inputs to ensure the cows were properly fed. It also had a cost structure that did not support the production that was coming off the farm, she says.

The intensity was reduced to a System 3-4 to closer to a System 2, shifting closer to a System 3 during the droughts.

The farms are pasture based with no brought-in feed such as palm kernel or other brought-in concentrates.

The farms grow 50ha of maize for silage and grain for their own use and a further 120ha of maize sold on the market.

Both, along with grass silage, are used to supplement the cows’ diet over the season’s shoulders.

All up, the changes have led to a 35% increase in production per hectare across the farms.

“And that’s despite three significant years of dry,” she says.

The farms have also introduced a summer cropping programme with turnips direct drilled for multiple maturity dates to spread out the feed availability over the season from November to January.

Behind the early-maturing turnips, sorghum is also drilled to provide the cows with a cheap feed alternative, keeping the herd fed until mid-February and March. This also ensures the land is not sitting fallow over the summer months, which can be detrimental to peat soil structures.

By that stage, the maize crop is usually ready for harvest and a local contractor cuts it for silage.

Dairy farmers with cows having a conversation
Watching the herd come in for milking are staff member Dion Wehi, CEO Jenna Smith, operations manager Stuart Telfer and Farm F manager Josh le Gros.

The farms have also undergone a comprehensive re-grassing programme at about 700ha a year across the farms. This is a shift away from perennial ryegrass to Italian hybrid varieties, providing good bulk feed for the farm in winter and spring with the surplus cut for silage or baleage.

They now assume at least four months of dry weather with low to no growth over summer, and while the changes are still a work in progress, they should make the farms more resilient to the summer droughts, Smith says.

While the bulk of the farms calve in spring, Pouarua Farms does have one farm operating a split calving system because it supplies nearby Green Valley Dairies with milk, which in turn supplies Lewis Road Creamery. The supply agreement required milk all year round.

That farm has an A2 herd and the necessary soils and infrastructure to be able to properly feed the cows all year round.

Pouarua Farms has a forever planting plan that was established when the iwi purchased the property.

Over that time, 7,500 plants per year have been put in the ground, creating gardens used to grow medicinal plants for traditional Māori medicine as well as flaxes for weaving.

The farms’ drains, raceways and other main thoroughfares have been planted with riparians to improve water quality and sediment loss.

The cropping process has also changed from full cultivation to using no tillage or direct drill. Behind the blueberry orchard is 20ha of land that in the past was peat mined. This has been allowed to regenerate into native vegetation in the hope it could be turned into a carbon sink.

All of these actions along with the reduction in stocking rates have seen Pouarua Farms’ nitrogen footprint fall by 11% across all farms.

“We’re ahead of our game in knowing all of our numbers and have certainly put ourselves in a good position to be responsive if we need to be,” Smith says.

Workers in milking shed
Farm manager Cama Tikoitoga changes the milk liners in the shed on Farm A while discussing operations with chief executive Jenna Smith.

The business switched suppliers from Open Country Dairy to Synlait on June 1 last year. Within a few months, all of the farms were certified at a gold-plus level with Synlait’s Lead with Pride scheme.

“We were pretty happy with that result. It shows that we’re already operating at a high level with the changes we had made in the previous year.”

Smith says they switched to Synlait because it better aligned with Pouarua Farms’ values.

“We have thousands of shareholders and we want to be able to prove to them that we are operating in a best practice model and that it’s independently assessed and verified by somebody else. OCD doesn’t yet have that ‘inside the gate’ approach.”

When the iwi took over, managers were appointed to each of the farms with staff allocated to each. There is a robust operating procedure for each of the farms, which the managers then enact.

That procedure includes bottom lines, such as not operating the farm on anything less favourable than a 6-2 roster, meaning the manager can operate however they wish within that framework, but it will not be less than that.

Operations manager Stuart Telfer also meets and talks with the managers frequently to catch up on farm business.

The farms are all run as separate entities with their own budgets and plans and there is little integration of resources. This encourages the managers to take ownership of their farm.

For the spring calving farms, a typical season has about 30% of the herd (all of the in-calf heifers and early calving cows) grazing off at Wairakei Estate in South Waikato.

This reduces the stocking burden on the milking platform with the older cattle wintering on an all-grass system.

Dairy farmer bringing in cows for milking
The farms are all run as separate entities with their own budgets and plans and there is little integration of resources. This encourages the managers – like Farm F manager Josh le Gros, bringing the herd in for afternoon milking – to take ownership of their farm.

Sexed semen is used on the cows they wish to breed replacements from with the rest being mated to Wagyu or other dairy beef genetics. Those heifers and cows return for calving, which starts in late July.

Part-time calf rearers are employed yearly to look after the calves and while each farm has its own rearing facilities, these rearers might work through two to three of the farms at a time.

The Wagyu calves are reared separately in a purpose-built facility. A portion of those calves are sold at weaning while the rest are reared and finished on the farm.

Genetics-wise, they aim to slowly breed the herd away from being Friesian to having more of a Jersey dominance, reducing the cow’s size and its load on the soil.

Pasture growth has been good through winter and spring over the past few seasons, allowing them to cut for silage and take full advantage of that pasture surplus.

“There’s a real concentration on fully fed animals of an all-grass diet that’s high quality. It’s why we went to baleage so we could take out small areas of surpluses so it wasn’t affecting quality and getting it back into the rotation quicker.”

At peak the cows are milking 2.1-2.2kg MS/cow/day.

Mating then starts and the introduction of collars that automatically detect when a cow is in heat has been a valuable aid, she says.

For now, Smith says they are looking to fine-tune their farms, continually look to improve while keeping a close eye on their limitations, especially as the farms come under increasing climatic pressures.

“We need to work out what that means for our business long term as there are external pressures coming and we have to make sure we are playing our part.”

That meant taking part in those conversations and maintaining dialogue with local and central Government to remain informed of regulatory changes that may occur.

Aerial shot of dairy farm with blueberry orchard
An aerial view of the extensive blueberry orchard, which was established last year.

“I feel incredibly comfortable staring into that stuff. It doesn’t bother me because I know we are operating in line with best practice because our kaitiakitanga and manaakitanga of the land guides us. It’s something Māori have done for years and now we just need to report on the practices.”

Pouarua Farms was also a finalist in the Ahuwhenua Trophy last year, which Smith says was a “full-on” experience.

She says they always had the intention of entering the contest when the iwi bought the farms. The competition alternates between dairy sheep and beef and horticulture every year and last year it was dairy’s turn.

The former chair, the late Hon John Luxton, urged his fellow directors to have a go when it came up as a topic of discussion at a board meeting.

“It was an intensive process and a really good one at such a young stage in our journey in that full ownership.

“We got to take stock of what we had done and have someone else come in and critique the bits we haven’t done quite so well and the bits we hadn’t thought about. To have that feedback at such an early stage at two years into full ownership was really beneficial.”

They have taken that feedback and are using it as part of their future strategy.

“It’s given us that assurance that we’re heading in the right direction in terms of diversifying the land capabilities. It definitely cemented a few thoughts for us and gave us the confidence that we were up there with some pretty good organisations.”

Smith says the board members, as iwi-elected limited directors, look at the business through a commercial lens as well as being landowners.

“They are incredibly supportive of me and give me autonomy to run the business how I see fit. We’ve turned it into a profitable business that is returning record profits, which in turn returns to their shareholders.”

The most noticeable way that it has returned to its iwi is through employment, she says.

“We want to see more tangata or mana whenua on the farms, that’s the vision. We had a workforce of approximately 20% Māori about 18 months ago, we’re now at 41%. That’s a strong tie to the shareholders, through employment.”

Pouarua Farms also looks at how it can help the local iwi in other ways, whether it be meat from livestock, sweetcorn in the maize paddock, or firewood from fallen trees to keep homes warm in winter.

“We don’t pretend to be perfect, but we have the best intentions and that goes a long way. We’re still working out what ‘forever’ looks like, but when you know it’s forever it’s pretty easy to take your time and work it out.”

Smith says the synergy was not always there when trying to be productive, profitable and align with their values.

“But it’s funny, when you take profit off the table as your first and only thought and start looking at some of those other measures of what good looks like in terms of looking after the land and looking after the people, the profit comes naturally.”

Farm Facts

Pouarua Farms

Location: Hauraki Plains
10 farms in total – eight dairy farms and one drystock farm and a blueberry orchard.
Farm size: 2,100ha in total (1,775ha in dairy and the balance in drystock or the orchard)
Herd size: 4,700 dairy cows with 4,400 calving this spring, 200-400 beef cattle farmed as trade cattle, 500 dairy-Wagyu calves reared and sold at weaning or finished.
Production 2021-2022: 1.62 million kilograms of milksolids across eight farms.
Production target 2022-2023: 1.65mkg MS.
Staff numbers: 40 full-time staff.

This article first appeared in the August 2022 issue of Dairy Farmer.

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