Friday, December 8, 2023

Consistency wins top dairy award

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A Waikato farm that has previously been a joint Supreme Award runners-up in the Dairy Business of the Year contest has gone one better to take the top spot this year.
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McCullough Farm Partnership owned by Richard and Nadine McCullough is the Supreme Award winner for 2020.

Northland farm Imeson Country run by Greg and Janelle Imeson is runner-up.

McCullough Farm Partnership is a 245-hectare farm milking 630 cows at Karapiro in partnership with Richard’s parents Bruce and Wyn McCullough. It also won the Best Waikato Farm Performance and Lowest Environmental Impact awards for the second year running.

The McCulloughs showed excellent return on assets at 6.2%, continuing a strong run in the most important single measure of business performance. They also achieved an excellent operating profit margin of 44%. For every dollar of income generated they retained a high proportion as profit. That enhances business resilience because it provides a buffer for changes in performance.

They had good cost control as demonstrated by their low cost of production of $4.46/kg MS. That is important because their income/ha is below average but tight control of costs gives a very good profit/ha.

Their high proportion of homegrown feed of 12.3 tonnes of drymatter a hectare lets them control the amount and price of their supplements and adds to overall farm resilience.

In the Lowest Environmental Impact category the McCulloughs had the highest environmental score of 10 out of 15 for low nitrogen leaching (26kgN/ha/year), spreading effluent over 54% of the farm and significant effluent storage, feedpad use and having 100% of waterways fenced and half of riparian areas planted.

The McCulloughs attribute their success to their genuine love of the land, forward-thinking farming practices and willingness to learn and develop.

Judges Michael Lawrence from Naylor Lawrence and Associates and Massey University dairy production systems expert Professor Danny Donaghy said “McCullough Farm Partnership managed to buffer the drop in payout by maintaining a return on capital that is more than 6%. A big strength was their consistency.

“They performed consistently well against all metrics and had the second highest return on capital overall, second highest total profit score, highest environmental score and were in the top 10% for human resources.

“This year’s Environmental award was again a tightly contested race. Many farms demonstrated improved environmental performance from previous years and others clearly have made sustainable land use their passion. 

“The overall winner and runner-up were primarily determined by the environmental score received as a result of the DBOY analysis, however, wider environmental initiatives are considered during the judging process.

Imeson Country is a 74ha farm in Northland milking 192 cows. It also won the Best Northland Farm Performance and High Input with Best Financials awards.

It has an exceptional return on assets of 7.1%. It is based on very low operating expenses/ha helped by a relatively low asset value.

The Imesons achieved a low cost of production of $4.14/kg MS with variable costs/kg MS particularly well controlled. That is a key feature of a resilient business because it provides a buffer for changes in market prices or climatic conditions.

The operating profit margin was a relatively high 39% achieved through a combination of relatively high milk price and low operating costs creating a high margin.

The judges said “The Imesons have produced two consecutive seasons of very consistent results, a tribute to their management skills.

Greg and Janelle Imeson from Northland are runners up in the Supreme Award and also won Best Northland Farm Performance and High Input with Best Financials awards.

“They had the highest return on capital, highest total profit score, are in the (top) 5% for environment, which they demonstrated is a real passion. Their operation was quite different with 192 cows and owner-operated. They are a highly driven couple focused on maximising their results.”

The Business Resilience Award – lowest cost of production per kg MS was won by Brent and Rebecca Miller and  Andrew and Rachele Morris from River Terrace Dairy at Carew in Mid-Canterbury. They also won Best Canterbury Farm Performance, Business Resilience Lowest CoP, Medium Input with Best Financials and the Best People Leadership awards.

The Millers are lower-order sharemilkers on the 273ha farm owned by the Morrises milking 1120 cows. 

“They had the lowest cost of production at $3.93/kg MS, a small increase on the previous year when they were $3.84 and also won this award. With pasture at 81% of feed input they achieved an impressive 502kg MS/cow. A business with strong and consistent performance,” the judges said.

All 2020 winners will hold Regional Optimisation Days on their farms later this year to highlight how they run resilient and profitable systems.

The Hopkins Farming Group, Waihora, Shawn Southee, won Best Lower North Island Farm Performance and was runner-up for Lowest Environmental Impact. Craigellachie Dairy Farms, Andy and Alan Grant,  won Low Input with Best Financials.

Other finalists were Greenacres (Kereone), Brad and Graham Pickett, Waikato, GE and KM Coxon, Gavin and Karla Coxon, Waikato, Campbell Farms, George Campbell, Waikato, Ruapuna Farms, Grant and Jan Early and Nick and Tina Giera, Canterbury, and Hopkins Farming Group, Tokomaru, Javier Pardo, Lower North Island.

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