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Lifestyle opportunity
Gareth and Juliet Levers had planned to invest their savings in their first home, but instead are leasing a farm.

Lifestyle opportunity

A farm next door to his parents offered chance of change of lifestyle for Gareth and Juliet Levers. Anne Hughes reports.

Leasing a farm may not be their best financial decision yet, but the lifestyle change is paying off for Gareth and Juliet Levers.

The couple, both 29-years-old, took on the lease in April last year, after struggling to get into the housing market at a time when prices were soaring.

When the farm at Miranda – almost next door to Gareth’s parents’ property – came on the market, it offered the opportunity for a lifestyle change.

Gareth’s family bought the farm. It is owned by their trust, from which Gareth and Juliet lease the farm.

Juliet was raised on her family’s sheep and beef farm west of Huntly and Gareth grew up on his parents’ beef and cropping farm.

The couple met at Lincoln University, where they both studied commerce and management. Gareth majored in finance and agri-business, Juliet in finance and operations management.

‘We have now got rid of the loan because the way the cashflow from the farm worked out it was cheaper to do it on a revolving credit/overdraft set up.’

After graduating, Gareth spent four years overseas – working more than 4000 hours/year running harvest crews during the United States harvest season and working in the Canadian oil fields during winter.

He returned to New Zealand, working for an agricultural contractor near Te Awamutu.

Meanwhile, Juliet was working for her family’s engineering business in Tokoroa.

They had saved about half the equity needed to get started on the lease block, taking out a small loan to stock the farm.

“We have now got rid of the loan because the way the cashflow from the farm worked out it was cheaper to do it on a revolving credit/overdraft set up,” Gareth says.

Farm facts

Gareth and Juliet Levers

Farming at Miranda, on the Firth of Thames, near the eastern end of Auckland/Waikato boundary

Leasing 210ha (170ha effective)

Mostly rolling country, with bush in gully bottoms

About 20ha in pine trees of varying ages

Equity built up through working long hours, including overseas

Farming a lifestyle change from working 4000 hours/year

Finishing Friesian bulls

Fencing streams

Five minutes’ drive to firth at southern end of the Hauraki Gulf

One hour’s drive to Auckland or the Coromandel beaches

 

“If any sizable improvements are needed in the future it may be cheaper to go back to a loan set up.”

Juliet continues managing the engineering business – spending three days a week in Tokoroa (one hour and 40 minutes’ drive from home) and two days working from home or travelling to meet clients.

They can live off Juliet’s income while the farm gets going, but insist the farm be a stand-alone business with no contributions from off-farm income.

Farming so close to Gareth’s parents allows them to share resources and also makes it easier for them to spend time off-farm now that their son is nearby to take care of it when needed.

Gareth and Juliet aspire to buy their lease farm one day. There is no specific plan in place yet, but that is the goal they are working towards. Managing or buying Gareth’s parents farm could also be an option in the future.

“Succession planning is vital if we are to maintain the farm and all family interests,” Gareth says.

Bulls seemed the best choice when deciding how to stock their lease farm.

Entering the bull market

Bulls were the clear choice for Gareth and Juliet Levers when deciding how to stock their lease farm.

It was already well subdivided into paddocks of about 0.7ha, with a gravity-fed water system.

The mostly two-wire electric fencing wasn’t suitable for sheep and Gareth says they would have considered dairy grazing if they couldn’t raise enough capital to buy their own stock.

Bulls seemed more financially viable than steers or heifers and they currently run about 300 – mostly bought in at 400kg, taken through winter and sold before Christmas.

Bulls can do a lot of damage during winter. Gareth wants to start buying in bulls as weaners, to winter a range of ages rather than a single stock class.

This would also improve cashflow, but stocking the farm from scratch has been more challenging and expensive than he expected.

Their first two winters have been tough. This year was especially wet, with persistent rain damaging farm tracks, making it more challenging to put weight on bulls and get into that routine of buying weaners.

‘Our tracks took a hammering in March really bad. I gravelled the tracks two days before we got 300mm of rain.’

The young couple say there is a definite awareness of mental well-being amongst the rural community. Friends and neighbours showed concern for them experiencing tough winters at the start of their farming careers and made a point of asking if they were okay.

They made it through both winters without supplement feeding. Rain damage this winter would have prevented Gareth from being able to get supplement to the bulls anyway and finding somewhere to feed it out with minimal damage would have been challenging too.

“Our tracks took a hammering in March really bad. I gravelled the tracks two days before we got 300mm of rain,” Gareth says.

“Since then it hasn’t dried up so I haven’t repaired the tracks.”

Instead of supplement feeding, Gareth divided the cells into half again and shifted the bulls daily, sometimes twice.

They always had the option of off-loading bulls to a buyer who was in a position to put more weight on them if needed, but it didn’t come to that.

The bulls still gained some weight, about half a kilogram/day. Gareth is targeting an average weight gain on 1kg/day over the entire time they are on the farm, to finish bulls at around a 650kg liveweight (LW).

Most paddocks are divided by a two-wire electric fence. Gareth then moves a polywire to divide the paddocks the way he wants.

He uses a remote to switch the electricity off every time he does a shift. It’s easier than having to go back to the mains every time a mob needs shifting and also means he’s less likely to forget to switch the power back on.

Gareth says it doesn’t pay to become complacent working with bulls and he wears a bull riding vest for protection in the cattle yards.

“I thought if I’m going to do this for 30 years the chances are I’ll get hit at least once.”

Any money the farm makes goes straight into improvements such as drainage, cultivation, fertiliser, tracks, water and fencing.

They have worked to reduce fixed costs, such as running the electric fencing off fewer power meters and only using the petrol pump for the water system as a back-up.

The farm is operating about half-way between their worst-case scenario budget and the more moderate version.

“The first year we said we would accept break-even and we did slightly better than that, but over the next couple of years it really has to start paying a return (as it is a business), but we want to do this sustainably,” Gareth says.

“The aim is really to have a high-performing beef unit with a zero (regenerative) effect on the environment.”

Gareth and Juliet have worked with Living Waters Partnership to fence and plant around the streams running through the farm and to control pests – mostly goats and possums – in the bush.

The streams are an amazing natural resource – home to mussels, fish and eels – and the couple want to preserve that.

So far, they have fenced about 3km of stream edge and have another 5km to do.

“The main thing now is getting the water system right, so the bulls can’t drink out of the stream.”

The water system was already in place, so they didn’t have to start from scratch, just having to buy more troughs as new areas are fenced.

This summer Gareth will be busy repairing the winter damage and replacing old fencing with two-wire electrics.

“Now everything’s getting fenced off from the streams, it changes the dynamic of the paddocks.

“It’s a good time to be planning and building new fences.”

Gareth’s plans to start some regrassing in April this year were put on hold after some good advice from his father, who didn’t think it would be wise being at the whim of weather and contractors one week before Gareth and Juliet’s wedding.

“Dad said it would probably backfire on me.”

When the timing is right, Gareth plans to try different methods, such as direct-drilling and cultivation, to see which has the best cost benefit.

New pasture will probably be a perennial ryegrass/clover mix. Gareth is also keen to see if lucerne will grow well in their summer-dry environment.

Maize could even be an option in the future for feeding to bulls.

They’re both happy with the decision to take on the lease. Juliet enjoys having her own career off-farm.

Depending on her schedule, she might spend one night a week in Tokoroa, but isn’t finding the travelling too taxing and helping out on the farm provides a nice change from her day job.

If the farm doesn’t pay its way, they have options. Gareth could work full-time off-farm and de-stock enough to be able to do both, but their financial discipline and patience has them on track for success so far.

“It’s not my best business decision yet, but the best lifestyle choice,” Gareth says.

“I was never hell-bent on being a farmer, but I definitely wanted a lifestyle at some stage.”

aahughes@gisborne.net.nz

Looking towards the Firth of Thames.

Learning the numbers

Gareth and Juliet Levers’ university education has given them a good grounding in finance, particularly managing and prioritising spending in their farm business.

Gareth’s graduate diploma in sustainable business covers the Resource Management Act and environmental, cultural and social management aspects – issues becoming more relevant to farming.

Gareth and Juliet run the farm as a company, making it easier to keep it separate from off-farm income. It was easy to set up, mostly online, with step-by-step guides to show them how.

They manage the farm accounts themselves, using accounting software CashManager.

The couple have considered farm management software for more day-to-day operations, but can’t justify the cost for the scale of the farm.

Instead, Gareth uses the free app Google Maps for managing bull rotations, water lines, troughs, tracks and bush in different layers on the mapping system.

It is even helpful for deciding where to put a new fence. By drawing the fence line on the map, he can see the exact size and look of the new paddocks before going ahead.