North East Waikato

The 2021-22 season is the second year of sharemilking on this farm. Efficient farm systems and attention to detail to minimise wastage with supplementary feeding are key to the success of this business.

Farm Facts

Business type: 50:50 sharemilker
Location: Kaihere, Western edge of Hauraki Plains
Farm size: 96ha effective milking platform
Peak cows: 300 F
PSC: 10/07/2021
Stocking rate: 3.13
Production: 130,000kg MS budgeted, (433 kgMS/cow, 1354 kgMS/ha)
Farm System:
2 (1-10% feed imported)
Soil type:
1/3 Peat, 1/3 silt loam and 1/3 clay
Wintering system: Cows wintered on the dairy area

This season the farm policy is changing to a farm production system 2, (1-10% imported feed), where the imported feed is maize silage from the farms support block. The aim is to be more insular with supplementary feed and not be reliant on palm kernel based feeds. The high price and the public perception that it is an undesirable product have influenced the decision to make this change.

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Numbers at a glance

Financial KPI 2021-2022 budget

Physical KPI Estimated for 2021-2022

Net dairy cash income
$/kgMS
Total farm working expenses
$/kgMS
Total operating expenses
$/kgMS
Dairy operating profit
$/ha

Pasture and crop harvested
T DM/ha

N applied to milking platform
kg N/ha
Total feed eaten per ha
t DM/ha
Six week in-calf rate
%
$3.21 $1.88 $2.65 $1,204 11 100

14.9

75

Management decisions

Season review

2021-2022 Forecast Budget

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Income $TOTAL $/KgMS $/COW $/HA
Net Milk Sales

This budget is based on a conservative estimate of $6.00 /kgMS, (advanced/deferred total) for 130,000 kgMS. Despite current, (as at 30/4/2021), optimistic forecasts, the milk price could still soften later in the year, so protect against this a conservative approach has been taken, plus, 22,000 kgMS have been locked in at the fixed milk price of $7.33. Milk revenue is net of DairyNZ and biosecurity levies (3.6 c + 2.4 c per kg MS).This milk income is the farmers best estimate of their likely net milk sales. It may or may not be out of date based on new information from Dairy Companies. It does not necessarily reflect DairyNZ's milk price forecast.

390,000 3.00 1,300 4,063
Net Dairy Livestock Sales

The budget is based on 61 cull/MT MA cows or R 2 heifers @ $800 per head plus 230 4-10 day old calves @100 per head and the sale of 2 bulls @ $1500 per head. The budget also includes the purchase of 31 in-calf heifers for $1550 per head, (average price), to bring cow numbers to calve for 2021 upto 319.

27,800 0.21 93 290
Net Dairy Cash Income 417,800 3.21 1,393 4,352

Expenses $TOTAL $/KgMS $/COW $/HA
Wages

One full time 2 IC staff member is employed. Some casual relief milking is included under wages.

(incl. ACC)
56,998 0.44 190 594
Animal health

Includes teat seal for heifers, dry cow therapy for all MA cows, vaccinations, calf dehorning, young stock drenches, minerals (zinc, magnesium, copper, selenium and b12), plus vet visits.

25,000 0.19 83 260
Breeding and herd improvement

Allows for herd testing and records - 4 herd tests per year, 2 sample option is used. Also includes metrichecking for the herd and 5 1/2 weeks AB. 2 bulls are run with the herd and rotated every 2-3 days with 2 fresh bulls to a further 5 weeks to give a total mating period of 10 1/2 weeks.

20,000 0.15 67 208
Farm dairy

Covers rubberware and detergents. The shed water supply is from a creek so detergent usage is on the high side to mitigate any possible water quality issues. The plant cleaning regime is based on a morning hot wash, bi-weekly alkaline washes and acid washes for the rest of the week.

6,000 0.05 20 63
Electricity

Shed is a 33 aside herringbone. Have a contract with a power supply company that provides weekly monitoring of power usage. Use this to evaluate usage and if need be modify how things are done to ensure the shed is run efficiently.

(farm dairy, water supply)
12,000 0.09 40 125
Supplements made

This is the 100% of the harvesting cost of about 50 t DM of silage on the milking platform. Also included here is 50% of the costs of growing 8-10 ha of maize on the milking platform, (planting, seed, weed sprays and harvesting) and 10 ha of chicory.

(incl. Contractors)
25,000 0.19 83 260
Supplements purchased

50% share of the cost of 6-8 ha of maize silage, (about 180 t) at $330 per tonne, (from the owners support block).

30,000 0.23 100 313
Calf rearing

Covers calf meal, sundry calf rearing equipment and bedding for 70 calves.

8,000 0.06 27 83
Young and drystock grazing

Calves go to the owners support block, (next door), and return to the milking platform as in calf heifers mid to late May. This is 50% of the grazing costs estimated at market rates for 70 R 1 heifers and 70 weaners. The market rates are then adjusted down to recognise that the sharemilkers do all the stock work on the support block.

12,000 0.09 40 125
Fertiliser

Covers 50 % share of nitrogen used on the milking platform, which is in the form of uea. It is spread in 4 applications over the season at about 25 kg N per ha per application. All nitrogen and fertiliser is applied by the sharemilker using their own or the owners equipment. Fertiliser applied is 15% potassic super at 300 kg per ha in the spring and autumn.

(incl. N)
6,250 0.05 21 65
Regrassing & cropping

All cropping costs are included in supplements made. This is for the regrassing of the chicory crop areas.

3,000 0.02 10 31
Weed and pest

Covers weed and insect control, labour and contribution to spray.

1,000 0.01 3 10
Vehicles & fuel

All basic vehicle servicing is done in house. Good maintenance and care schedules are followed.

16,000 0.12 53 167
R&M

Covers plant and machinery R & M plus tools and hardware purchases.

(land, buildings, plant, machinery)
2,000 0.02 7 21
Freight and general farm expenses

Protective clothing, dog expenses and rubbish removal plus some livestock freight.

2,500 0.02 8 26
Administration

Do all own GST and budgeting. Includes accountancy, bank charges, farm consultant, subscriptions, communication, computer, stationery and general administration.

9,000 0.07 30 94
Insurance

Do not believe in being over insured, so have higher excesses as only want cover for things that are costly to replace. Have cover for public liability, milk contamination, business interruption and income protection.

6,000 0.05 20 63
ACC

Estimated from the 20-21 actual results.

4,000 0.03 13 42
Total Farm Working Expenses 244,748 1.88 816 2,549
Cash Operating Surplus 173,052 1.33 577 1,803

Non-cash adjustments have been included below the cash analysis to enable fairer comparisons to be made between farms. These adjustments are not part of a cash budget but are important to fully understand the efficiency of the farm business.

Non-cash adjustments $TOTAL $/KgMS $/COW $/HA
Value of change in Dairy livestock

Expect to finish the season with similar numbers of cows to calve. There will likely be 26 more in calf heifers and 7 more in calf cows than at the start of the season. This offsets the purchase costs of 31 in calf heifers.

42,500 0.33 142 443
Labour adjustment

This covers 1.3 FTE of unpaid input into the business.

75,000 0.58 250 781
Depreciation

Based on previous years financial statements with adjustment for any asset purchases/sales.

25,000 0.19 83 260
Dairy Gross Farm Revenue 460,300 3.54 1,534 4,795
Dairy Operating Expenses 344,748 2.65 1,149 3,591
Dairy Operating Profit 115,552 0.89 385 1,204

More information

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