Michael and Megan Webster left behind professional careers in Auckland to go dairy farming in 2007 and despite a second year of payouts below breakeven they remain determined to succeed on the farm.
Megan, a chartered accountant who had specialised in tax accounting, has resumed her accountancy career as well as managing their farm accounts while Michael, previously with a logistics company organising the transport of goods around the globe, is now farm manager and contract milker for Webster Farms.
He says some people might consider his four years’ study for a business degree from Auckland University as wasted now he’s milking cows.
“But when you see the size of our farm mortgage, it’s big dollars so you have to see this as a business first and milking cows comes second.”
“People will think differently, that it’s all about milking cows, but it’s really about making money.”
He said a firm decision was needed about whether to go farming or stay in Auckland when his father said unless he took over the farm it would be sold so his parents could retire.
Michael and Megan had visited frequently, found they “loved the community” and Megan recalls she instinctively felt that the Ngatea farm where her husband grew up was ultimately to be their family home.
Michael says he had a basic knowledge of farming when he began as a farm assistant full-time for his parents Richard and Gillian Webster.
The following year he graduated to the role of farm manager.
“We thought about going elsewhere for farm experience and then coming back but decided if we were going to pour all our energy and time into a farm we may as well do it for our family business.”
Meanwhile Megan was able to resume her career as an accountant 20km away, in Thames with the Thames-Coromandel District Council, as well as continuing to manage their farm accounts and other data.
“I don’t leave it for the bank or (another) accountant to do. This is our business, this is what we are doing and how we are doing it.”
In 2012 the country’s dairy farm budgets were conservatively based on an income of at least $6/kg milksolids (MS) – a return exceeded in four of the five previous years – and Michael and Megan bought a 40% share of the 217 hectare farm.
The following year the payout plus dividend from Fonterra hit a new peak of $8.50/kg MS and the future was looking rosy for dairy farmers. Then came the slump last year to $4.65/kg MS, followed by the current season’s payout again below average farm operating costs.
The Websters’ strategy to reduce the impact of the payout drop, by reducing costs without losing production, was literally in the spotlight when last year, starting June 1, they accepted being monitored as the Hauraki Plains focus farm for farmer group P3 Trust.
The trust is supported by ANZ Bank and DairyNZ to provide farm advisory services that can assist the focus farm’s development of a business strategy, onfarm decisions and measurement of results.
In return the focus farm’s progress is reported back to the farming community every week in the form of a newsletter emailed to 480 subscribers – a subscription that’s freely available to anyone through the DairyNZ website.
“We came into this because we wanted guidance over the next three years,” Michael says.
“We wanted a strategy and have developed four key cornerstones for the business with our goals and targets within those key areas. There’s been some wins and we are chipping away in other areas.”
The key areas of focus are feed, people, profit and animals and some game-changing decisions have been made but the first bold change was before the focus farm monitoring began.
In 2012 when Michael and Megan became part-owners of Webster Farms they dropped the winter milking contract.
Megan had agreed a benefit in supplying winter milk was farm income was spread through the year, but the downside was it hampered farm development.
“Yes, winter milk was smoothing income but we could make more money doing it seasonally and doing it well.”
There were 250 cows being winter milked, 40% of their 630 crossbred cows, on half the farm, but that didn’t fit with their development plan and it was out of place on the Hauraki Plains where the marine clay holds a lot of water in winter and pastures are prone to pugging.
Michael realised the cycle of calving and milking was continual “and there wasn’t the opportunity to focus on pasture renewal or any other improvement when turning a wheel that never stops”.
“My parents are extremely supportive of everything we do. We put to them the positives and they agreed. Everyone was getting exhausted because the farm never stopped and we couldn’t really focus on our strengths because we were too busy trying to be jacks of all trades.”
A big call since becoming the focus farm has been to regrass the whole farm. One-third has been resown since last autumn and another 10% undersown for denser and higher quality ryegrass and clover.
Chicory was extensively sown as a summer crop to be turned over into perennial pasture while crops of turnips and maize have been taken out of the farm system to save costs.
“We are not trail-blazers. We talk to top farmers and ask how they do it. We talk to seed reps, we get everyone coming and we look for the best recipe,” Michael says. He walks the farm every week, usually over three days, to assess pasture growth in each paddock.
It takes two hours on a set path with pasture cover assessed by his ‘eye-o-meter’ and the readings keyed into a MINDA Land and Feed cellphone app for later upload to the computer at home that Megan uses to update spreadsheets and the farm’s feed wedge.
“I can tell when the grass is starting to accelerate or slow down and can make decisions rather than looking at a tanker docket and thinking what’s happening,” Michael says. He usually walks the farm on his own and part of the way each week with P3 Trust project manager Wayne Stachurski.
He wants to encourage their three farm staff to also “track each paddock” so they too can decide how much of a break to allocate the cows.
“Looking at the new grass now, the cows are grazing it easier and they’re learning there’s no point waiting for a truck-load of another feed to turn up because it’s all-grass and chicory supplemented only by palm kernel.”
At the start of their farming venture Megan believes they were “a bit behind the eight ball in terms of farming experience” but have found willing support from great friends and the wider community.
“We are now definitely focused on growing more grass, utilising that grass and keeping our eyes on everything on the farm to make sure we are doing everything right.”
Michael says their involvement as managers of the focus farm for the region has offered huge opportunities to grow their business.
“We’ve had really good support from local farmers who have come in to help on some topics and with anything we may be struggling on. There’s been great support and we have made huge strides in some areas, particularly pasture management.
“There’s a long way to go but we are pretty determined to get there and we are looking forward to seeing where we end up.”
- Steve Searle