Budgeting, Justin and Melissa Slattery (East Waikato)


9 min read

Farm facts Numbers at a glance Mid-season update Management decisions 2023-24 forecast budget Additional resources

Justin and Melissa Slattery farm in Elstow, prioritising environmental stewardship with efficient resource use. On their 177 ha milking platform, they manage 535 FJX cows. In the upcoming season, they're expanding with an additional 77 ha and will operate two herds, one of which a contract milker will manage. Their vision emphasises leadership in profitability and sustainability. They adjust their budget frequently, use any surplus to reduce debt, and assess their financing yearly. By benchmarking with tools like DairyBase and networking with professionals, they aim for continuous improvement. A key focus is achieving superior environmental outcomes on their farm.

Justin and Melissa Slattery have been on their 100 ha farm at Elstow, between Tahuna and Paeroa for 6 years.  Their approach to farming is to be good stewards of the environment through having simple systems that are resource efficient.

The 2023-24 season will be their first with an additional 77 ha, (owned/leased), next door. The business will operate 2 herds through separate sheds but there will be movement of stock and feed between the two areas at times during the year. One farm and shed will be managed with a contract milker.

Farm facts

Business type: 

Owner-operator with Contract milker


Elstow, Southern side of Hauraki Swamp

Farm size: 

177 ha effective milking platform

Peak cows: 

535 FJX (540 wintered)


1/7/2023 MA cows (23/6/2023 Heifers)

Stocking rate:

3.0 cows/ha

Farm system: 

3 (11-20% feed imported)


210,000kg MS/year budgeted, 1186 kg MS/ha 393 kg MS/cow

Production (3 year average):

1,170 kg MS/ha and 390 kg MS /cow

Numbers at a glance

Financial KPI 2023-24 budget
Net dairy cash
income ($/kgMS)
Total farm
expenses ($/kgMS)
Total operating
expenses ($/kgMS)
Dairy operating
profit ($/ha)
$7.88 $4.30 $5.11 $3,298
Physical KPI 2022-23
Pasture and crop
harvested (DM/ha)
Purchased N
surplus (kg N/ha/yr)
Six week
in-calf rate (%)
15.1 96 13.6 NA

Find out more about these KPI's and how to calculate them for your own farm here.

2023-24 mid-season update January 17th 2024

Numbers at a glance

2023-24 mid-season update as of 17thJanuary 2024.

View/download PDF of updated budget

Financial KPI's Budget Updated forecast
Milk Production (kgMS/ha) 1,186 1,130
Milk Production (kgMS/cow) 393 377
Net Dairy Cash Income ($/kgMS) $7.88 $7.83
Total Farm Working Expenses ($/kgMS) $4.30 $4.57
Cash Operating Surplus/Deficit ($/kgMS) $3.58 $3.26
Gross Farm Revenue ($/kgMS) $7.89 $7.88
Operating Expenses ($/kgMS) $5.11 $5.42
Operating Profit ($/ha) $3,298 $2,778


Comments and points of interest

Key Points

Production for the season has been revised downwards by 5% following a particularly wet winter and spring.
•    Cash operating surplus is likely to be down 13% largely due to the lower forecast milk production and milk price.
•    Close monitoring and management of the budget has kept total farm working expenses close to the original budget but there is significant variation for some costs.


A combination of a wet winter and spring and a slower calving pattern of bought in cows resulted in a revision of the budgeted milk solids down to 206,000 kg from 210,000 kgMS. This has since been dropped to 200,000 kgMS.
The milk price has also been revised down by $0.43/kgMS so the updated forecast for income is significantly down on the original budget, (6%).
Milksolids to end of December is 126,371, (63% of revised total of 200,000 kg). Peak cows milked is 530, (5 down on budget). Losses at calving were a bit higher than budgeted due to metabolic issues in older less sound cows kept to make up numbers. Cow numbers still milking by December 31st were 523.
Daily per cow peak was 2.1 kgMS/cow/day, being fed pasture, maize or grass silage, and PKE/DDG blend.
Supplements fed to date are all the maize and grass silage that was on hand at the start of the season, (150 tDM, 283 kgDM/cow), plus meal through the shed, (PKE/DDG mix, 255 tDM or 481 kgDM/cow). This is as per budget.
The wetter than average winter and spring meant pasture growth rates were down and pasture cover was well under control all spring and early summer. Only 100 bales, (18.5 tDM), of baleage was made late spring which is 30% down on budget, (140 bales). 
14 ha maize planted early to mid-November but it went in 3 weeks later than planned because of the wet.
4.5 ha of fodder beet was planted October 10th, again about 3-4 weeks later due to the wet conditions. This means it will be 3-4 weeks later before it is ready to be grazed. To fill the gap 2.5 ha of turnips were planted.  The turnips will be grazed from January 25th and should last until mid-February when the Fodder beet will be ready.
The herds have been on twice a day milking but the plan is to put one herd on to 10/7 on 20th January. This will be milking once a day on Sat, Sunday, Tuesday and Thursday and twice a day Monday, Wednesday and Friday. This will take the pressure off the younger cows.
Fertiliser usage is down on budget.  It was too wet on the peat so two nitrogen applications were missed  in the spring, plus when the payout drop was announced, fertiliser applications were prioritised and most of what has gone on has been applied to the 30 ha purchased this season.
The PKE/DDG mix was able to be contracted at $440 per ton landed which is about $120 less than budgeted. R & M is up with half the increase relating to unforeseen breakage on the new farm and additional drainage being needed on the home farm as a result of the wet winter and spring.
Regrassing and cropping costs are up on budget in part due to the timing of payment for maize harvesting. The 2024 harvest will now be in this financial year.
When the payout drop was announced all farm expenditure was reviewed and we operated a zero budget where all expenditure had to prove a return. This has gone a long way to ensuring that there has been minimal cost creep this year, (forecast total farm working expenses are only about $12,000 up on budget, and this is including paying for 2 years of maize harvest).

Current position

Production is currently 1.3 kgMS/cow/day from 523 cows. Daily total milksolids is behind budget, hence a further reduction in forecast MS for the season. BCS is lighter than target, which is a reflection of the tougher season so far. Feed intakes at present are 17kg DM/cow/day from pasture and 1 kgDM/day from meal.
Current pasture cover is 2,200 kgDM/ha. The herd is on a 25 day grazing rotation.
With a total of 17 ha out in crops the current stocking on pasture effective area is 3.27 cows/ha. Current growth rates are 60 kgDM/ha/day, and with 30 mm rain 15/16 January this should hold for a bit longer. With daily pasture intakes of 17 kgDM/cow/day and 3.27 cows/ha this equates to 56 kg/ha/day, so cover is holding or increasing slightly.

Looking forward

The options for destocking and once a day milking will be considered for later in the season for both herds if growth rates, cover and cow condition drop too much. 
There are still 1 to 1 ½ more applications of N for the season depending on the weather, which will be used in the autumn to help increase growth rates and pasture cover.
Current feed on hand available to feed out between now and mid-May is 313 tDM which equates to about 600 kg DM/cow on 523 cows or 5.4 kgDM/cow/day. This will still leave about 150 tDM maize/baleage to take through to next season. 
The plan is to feed turnips till mid-February, then fodder beet till drying off mid-May, (this is of course rain and culling dependent).  The PKE blend can be fed at higher rates to cover any gaps until the maize is harvested in late March.
All decisions from now on are based on feed budgets and ensuring pasture cover and cow BCS targets are met at the end of the season so that next season is not compromised.

Calving and reproduction

•    The calving pattern for the 2023 spring was 85% in 3 weeks, 92% after 6 weeks and 100% by 9 weeks.
•    Herd testing for one herd was dropped following the payout and at the same time the decision was made to switch to cheaper heat detection methods. 
•    Pregnancy testing is planned for early February.
•    More AB heifers were born than expected so all 130 have been reared. The plan is to have a good cull of older and poorer producing cows in two years’ time. 
•    Weaners went off farm on November 20th as planned.
•    A total of 16 bulls were purchased for the two herds and the yearlings at grazing.  The difference between purchase and sale price will cost about $675/bull. Bulls were removed prior to Christmas and have been sold.

Other points of interest

•    High interest rates are hurting but at least they have not risen further.
•    Still very concerned about the El Nino forecast and it is looking like the hot dry weather forecasted earlier is starting to appear.
•    There are still a lot of maintenance work to do, in particular upgrading the race that connects the two farms so that it can withstand the increase in traffic.
•    Riparian planting plans has been put on hold while other more essential bodies of work are carried out.

Management decisions

Strategy and financial

  • Vision
    Aim to be leaders in the area for both profitability and reduced environmental footprint.
    Utilise the opportunities that we have, respect them, and be proud of the work we do.
    Look to continuously improve our farm and practices, keeping a long term view.
  • Financial management
    Prepare a budget annually. The annual budget is treated as a live document, where adjustments are frequently made from changes in the season and prices.
    Be flexible to adapt and move to make the most of our situation and opportunities.
    Review the budget, but focus on the longer term impact of decisions.
    Any cash surplus is used to pay down debt.
    Financing facilities are reviewed yearly, to ensure they are sufficient to meet the forecast needs for the year. This means better financing costs can be negotiated.
  • Benchmark
    Use industry analysis and benchmarking tools like DairyBase, to measure progress and identify opportunities for improvement.
  • Networking
    Engage with other professionals and like minded farmers to continue learning, share ideas and help promote good environmental outcomes on farm.
    Being members of the Dairy Environment Leaders group is an example of this.
  • Environment
    Achieving a high standard of environmental outcomes is important for the farm.
    Attention is given to improving environmental metrics as well as the external environment of the farm.


  • Environmental metrics
    Purchased N surplus has reduced by over 30% and Biological greenhouse gasses have dropped by 12% since it was first measured and reported in 2019-20. The aim is to continue this downward trend through being even more efficient with use of resources.
  • Fertiliser
    On the original 100 ha, Olsen P levels range from 28-72 and pH levels are 5.9-6.3. The new farm is still awaiting soil test results.
    Fertiliser applications are tailored for different management blocks to match plant requirements and minimise losses.
    Farm spreaders are calibrated regularly to check spreading width and volume. The plan is to eventually have GPS precision capability added to spreaders for more efficient use of fertiliser.
    Focus is on increasing clover performance so that nitrogen applications can be reduced. Nitrogen applications will likely be under 120 kg N/ha/year over 5 applications, but are dependent on soil moisture and pasture cover.
    Product used varies on the time of year and expected rainfall. This spring one application will be in liquid form with progib and sulphur, which has a quicker uptake, so a lower application rate can be used.
  • Water use
    Water supply is from ground water via a bore. The water is high in iron so undergoes filtration before being used on farm.
    Efficient water use is important to the business, so a water meter is installed, with an alert connected to an app on the phone. Water use is 7 l/litre of milk produced.
    Total water extraction and farm dairy water use is reported to the Waikato Regional council six monthly. 
  • Effluent management and use
    Effluent can be irrigated on to about 40% of the farm.
    Work has been done to ensure runoff and sediment from races is directed away from waterways and onto adjacent pastures.
  • Shelter and riparian planting
    Vulnerable areas of the farm have been identified and are part of a programme of work to be retired and planted in trees or riparian plantings, as time and funds allow.
    Six years ago there were no shade trees of shelter on the farm, there are now over 70 shade trees, with plans to plant more, and there is now focus on planting native shelter belts.
    The shade trees planted are: pin oaks, red oak, London plane trees and magnolias. 
    Work is underway to progress the planting some native shelter belts using a mix of cabbage trees, ribbonwood, pittosporum, kanuka and some flax.
    About $2,000-$3,000 is spent each year on trees, which have had a 95% success rate for establishment. 
  • Waterways
    All drains and waterways are fenced. There are plans to plant carex along main waterways to improve shade and reduce sediment runoff. 

Farm policy and infrastructure

  • The farm aims to operate a system 3 production system, the aim of having less than 2 t DM/ha of imported feed. Pasture harvested in 2021/22 was 11.9t DM/ha.
  • The business now has 2 farms with two herds run through 2 dairy sheds; 300 cows through a 28 aside herringbone and 235 through a 22 a side herringbone.
  • Imported feed is fed in shed, (both sheds have in shed feeders). The maize and silage is fed in paddock on the original farm and on a small concrete pad in troughs on the new farm.
  • About 11% of the farm is cropped.
  • Achieving target pasture covers and cow body condition scores at critical times is key to the success of the business, and drive decisions around supplementary feeding, once a day milking, culling and drying off.
  • The dairy sheds are under 0.8 km from the most distant paddock.
  • The farm is well raced and fenced and has good water supply to each paddock.
  • Young stock are grazed off farm from weaning until 22 months of age.  Live weights are monitored and actions taken to ensure target live weights are achieved.


  • Pasture management
    Pasture cover is monitored frequently all year round and the information used for regular feed budgeting. This is key to ensuring efficient use of pasture grown and supplements used.
    The spring rotation planner is used through calving and into the early spring.
    PKE blend is fed along with maize silage all spring. The front end loader is fitted with scales so it is easy to accurately measure the wight for feed allocation.
    Supplementation is gradually reduced in late spring and stops once residuals can be maintained at 1500 kg DM/ha without adding in extra feed.
    Spring surpluses are usually managed by taking paddocks out for cropping so little surplus is harvested as silage.
    10-11% of the farm is regrassed each year following cropping.
    The farm operates a zero-pasture damage policy during the winter. Extra large grazing breaks are used at times in wet conditions, and, in periods of extreme wet stock will be stood off on the dairy shed yards if necessary.
  • Supplements purchased
    Imported feed is a PKE, DDG, Tapioca blend. About 620 kg DM/cow is imported,(1.9 t DM/ha). In shed feeding minimises wastage and allows for more efficient use of feed.
  • Cropping
    The plan for 2023-24 is to grow about 15 ha maize and 4.5 ha of fodder beet.
    The fodder beet is planted in September using conventional cultivation and planting methods. Feeding starts in mid-January to slowly introduce the crop into the cow’s diet. The aim is to be at maximum fodder beet intakes by mid-February when it is usually getting very dry. The crop should last till mid-April and is regrassed late April, early May. The average crop yield is estimated to be about 20 t DM/ha.
    The maize is planted following conventional tillage methods. Harvesting is usually early March. Yields are around 20 t DM/ha.
  • Supplements made
    Very little supplement is made, at most about 10 ha or 25 t DM as wrapped baleage.


  • Breeding and herd testing policy
    Mating consists of 4 weeks of AB with premier sires followed by 8 weeks with bulls. 24 Jersey bulls will be purchased, 5 yearlings to run with 129 replacement heifers and 19 R 2 bulls to run with the cows. As there are 2 herds the bulls will be split into 4 teams, and 2 teams rotated with each herd.
    Herd testing for the year is 3 tests, (over 2 milkings unless on once a day).
  • Animal health
    The approach to animal health is to be proactive and vigilant.
    Mg supplementation to the herd is carried out in winter and late spring.
    Cu levels as per liver tests are normal so supplementation is not required at present.
    Zinc supplementation is carried out summer and autumn based on spore count levels for the area published by the vets.
    Lameness is not an issue on the farm.
    Mastitis management is based on industry recommended guidelines.
    Wastage is about 3% deaths and under 10% empties.
  • Young stock policy
    Calves are reared on colostrum/wholemilk twice a day plus meal and hay. They are weaned off meal at 100 kg at about 10 weeks old.

People, health and safety

  • The overarching employment philosophy is to be an employer of choice.
  • The farm is currently operating with one full time staff member to assist owners on one farm, (300 cows), and one contract milker with some owner support over calving and at key times, on the second farm, (235 cows).
  • Weekly hours worked do not exceed 45 hours per week. Staff get 4 weeks annual leave plus statutory leave.
  • Owner unpaid input covers Justin full time across both farms, Melissa assisting with calf rearing as well as input from both of them for all financial management, administration and governance.
  • Time off farm is important for the owners. With at least two family holidays planned each year as well as one individual holiday each.
  • Processes are in place to ensure the business is compliant for all health and safety requirements.
  • Induction meetings are carried out for new staff.
  • Monthly meetings are held with for all involved on the farm.

Budget revision following milk payout drop

August 15th, 2023

A $1.25 drop in the advance means about $265,000 has disappeared from income. We are going back to a zero budget, where every single expense has to prove a return. Some revisions include:

  • Marginal milk will be cut further as the returns have dropped, so extra feed will not be purchased to keep cows milking for longer
  • OAD and early culling to reduce feed intake will be considered after Christmas
  • We have put on fertiliser in good years and our levels allow us to mine the farm this year. The new farm is waiting soil test results etc. so we will just have to be strategic as to what fertiliser is required there
  • We have split our herd codes for the two farms and will be herd testing the sire-proving heifers through the new shed so we can cut herd testing on our original herd. This means the SPS rebate will cover the cost of herd testing on that side
  • Replacing our first-choice heat detector strips for a cheaper version has resulted in a 20% saving
  • I am considering full-time work.

What advice would you give to farmers who are either first time sharemilking or farm owners?

Update your budgets and go into each month eyes wide open so there are no surprises.

Work out percentage returns for $$ spent. I know it's never an exact science but as a sharemilker anything under 30% on an average pay out is not the focus of your energy.

If you are a first farm purchaser, follow best practice financial management which includes setting and following a budget, monitoring cash flow and sharing with your bank manager. Set a strategy for interest rates etc and work out what the full season looks like.

What words of positivity would you give to farmers planning for the coming months ahead?

The best lessons are learnt in hard times.

We rebounded and purchased our farm post $3.90 pay out because we had managed the low and were ruthless with our spending. Opportunities flow in times like these.

Do you have any tips and tricks for looking after your people on farm?

Make sure you are well, which will allow your team to be happy in their job.

Enjoy the team spirit on the farm. Having a good culture makes farming enjoyable and relieves some of the stress.

Strategies for managing a dry summer

October 23rd, 2023

How has the season been so far?

  • The season has been wet with slow pasture growth which is not the best for early calving. All stored supplement was fed out through the spring.
  • Production compared with budget is 6% down.
  • Rainfall to date (since June 1st) compared with average, as per Paeroa Weather station is 8% up for the season to the end of September, however June rainfall was double the average and on the back of a wet summer made the winter and early spring difficult.
  • Pasture cover is finally where we want it at about 2400 kgDM/ha.
  • Feed to be used at the new shed with in shed feeding was fixed early in the season so at this stage the imported feed costs are unchanged.
  • N use similar to budget.

What are cash flow forecasts looking like? How will a drought impact this?

  • The cash flow is looking better now with a $0.50/kgMS lift.
  • There was a cash flow pinch that was manged through careful allocation of funds in and out.
  • We have had an additional one off drain cleaning bull of $12,000 due to the extra wet winter and the need to clear clogged drains.
  • The budget already has some contingency already built in to cope with a drought. How impacted really depends on how long and how bad the drought is.
  • Milksolids produced would be lower than budget, and some costs may increase. For example, if it is really bad, regrassing costs might go up and off farm grazing for heifers could be higher.

Has the NIWA El Nino forecast changed how you are approaching this summer?

  • We have increased our cropping area to 12%, (from 8.5%), but a dry summer is not the only factor to influence that. Pasture performance is a contributor to this decision, plus, with the new farm next door, we need to increase the amount of maize silage to carry through for next year and have decided to plant a bit more than the original budget.
  • We have tweaked our cropping plan based on advice from our agronomist.
  • We usually start feeding the fodder beet before it is fully matured. However, our agronomist has calculated that we are best to plant a paddock of turnips as an earlier maturing and cheaper alternative for feeding out in Jan feeding. The fodder beet can then be started in February when it is more mature. This saves some cost as turnips are much cheaper to plant than fodder beet.
  • Every 8-10 years we have a drought. Having this area cropped gets us through a 3 month drought.

What strategies do you have this season for when a drought comes early, late, or is prolonged?

Comes early
Monitor feed supply and utilise once a day milking and then early culling to try to balance feed demand with supply. The aim is to try to keep as many cows milking as possible so if the drought breaks early and pasture growth increases there are still enough animals on farm to take through to the late autumn.

Comes late
If a dry spell is later then the herd will be milked on twice a day for longer and culling may be delayed.

Is prolonged
If there is a prolonged drought, the plan would be to go once a day early, cull empties as early as possible and try to keep heifers off the farm for longer, or wintered off so that the pasture cover and cow condition for the next season is not compromised.
The current budget does include $20,000 to purchase silage to extend the crops if needs be. This is an early March decision and coincides with trying to keep the in calf heifers off beyond May. The aim is to extend the grazing of crops eaten until rain comes to protect undersowing and pasture cover for late lactation.

2023-24 Forecast budget 

Budget last updated June 2023

Net Milk Sales
This budget is the first season with 2 supply numbers so the deferred income is based on only one production from one farm, 120,835 kg MS @$1.57/kgMS. The advance is based on 120,000 kg MS @ $6.57/kg MS. Income includes a total Fonterra dividend of $0.30/share on 99,900 shares. This is net of the DairyNZ levy of $0.036 /kgMS. *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 DairyNZs milk price forecast.
1,583,500 7.54 2,960 8,946
Net Dairy Livestock Sales
Estimate there will be about 95 MA cull cows and empty R 2 heifers to sell @ $700-$750/head plus about 380 bobby calves @ $30/head. Includes purchasing 24 Jersey bulls, (5 yearlings @ $1,000/head and 19 2 year olds @ $2,000/head). These will all be sold December/January for about $800/head (yearlings) and $1,600/head 2 year olds).
71,000 0.34 133 401
NET DAIRY CASH INCOME 1,654,500 7.88 3,093 9,347
Wages (incl. ACC)
This covers paid wages for one full time staff member to assist owners on one farm, (300 cows), and remuneration for one contract milker with some owner support over calving and at key times, on the second farm, (235 cows). This is net of staff housing, and includes employer contributions to Kiwisaver. The contract milker is responsible for shed and electricity costs for the 235 cow farm, plus the provision and running of a farm bike.
180,000 0.86 336 1,017
Animal health
The approach to animal health is to be proactive and vigilant. Animal health costs include mineral supplements as required. This is mainly Mg in winter and late spring. Cu levels as per liver tests are normal so supplementation here is not required at present. Zinc supplementation is carried out summer and autumn based on spore count levels published by the vets. Lameness is not an issue on the farm. Mastitis management is based on industry recommended guidelines. Wastage is about 3% deaths and under 10% empties.
30,500 0.15 57 172
Breeding and herd improvement
This covers 4 weeks of AB with premier sires followed by 8 weeks with leased bulls. 24 Jersey bulls will be purchased, 5 yearlings to run with 129 replacement heifers and 19 R 2 bulls to run with the cows. As there are 2 herds the bulls will be split into 4 teams, and 2 teams rotated with each herd. Herd testing is included with 3 tests, (over 2 milkings unless on once a day).
27,900 0.13 52 158
Farm dairy
This is for the farm dairy consumable costs for the 28 a side herringbone shed. The contract milker remunerations covers their share of the shed costs for the 22 a side shed.
21,100 0.10 39 119
Electricity (farm dairy, water supply)
This is the shed and farm electricity for the 300 cow farm, 28 bail herringbone shed.
17,600 0.08 33 99
Supplements made (incl. Contractors)
Very little supplement is harvested on farm, with spring surpluses managed by dropping paddocks out for cropping. An allowance of $3,500 for about 25 t DM baleage, (10 ha), is included here. (Approximately 140 bales @180kg/bale @ $25/bale).
3,500 0.02 7 20
Supplements purchased
The budget is for about 370 t (wet), 333 t DM of PKE blend, (with DDG and some tapioca), @ about $560/t landed. Both sheds have in shed feeding systems so wastage is low. This equates to about 620 kg DM/cow.
207,700 0.99 388 1,173
Calf rearing
About 115-120 replacement calves will be reared. Calves are reared on colostrum/wholemilk twice a day plus meal and hay. They are weaned off meal at 100 kg at about 10 weeks old. Includes bedding and equipment.
5,400 0.03 10 31
Young and drystock grazing
The yearlings are off farm for 52 weeks and weaners for 26 weeks. This does not include freight.
113,500 0.54 212 641
Winter grazing
All cows are wintered on.
0 0.00 0 0
Fertiliser (incl. N)
Focus is on increasing clover performance so that nitrogen application can be reduced. Nitrogen applications will likely be under 120 kg N/ha/year over 5 applications, but are dependent on soil moisture and pasture cover. Product used caries on the time of year and expected rainfall. This spring one application will be in liquid form with progib and sulphur, which has a quicker uptake, so a lower application rate can be used. Fertiliser to be applied is still to be finalised following soil tests on the new farm.
120,000 0.57 224 678
Regrassing & cropping
This covers the cultivation, seed, planting, weed and pest control and harvesting of 15 ha of Maize for silage, along with the cultivation, seed, planting and weed and pest control of 4.5 ha of fodder beet. In addition this cost includes the regrassing of these areas in the autumn plus an allowance for some remedial regrassing or patching if needed.
50,000 0.24 93 282
Weed and pest
Weeds are not too much problem. This covers some weed spray and some pest control.
1,000 0.00 2 6
Vehicles & fuel
Keep vehicles well maintained and try to be efficient with vehicle use. No extra vehicles were purchased with the addition of the second farm. The current tractor and machinery will be shared and so will just work a bit harder.
35,100 0.17 66 198
R&M (land, buildings, plant, machinery)
Maintenance for this year will just be essentials. The infrastructure on the original farm is now in reasonable shape so just basic maintenance will suffice for this year, particularly if the payout drops. The farm has its own sand pit so race maintenance is relatively low cost.
22,800 0.11 43 129
Freight and general farm expenses
This includes freight, (on stock sold/purchased and young stock to grazing), protective clothing and bio security levies.
12,500 0.06 23 71
Do own financial management, (budgeting and GST), and administration. Accounting costs are low as one shareholder is a qualified accountant. Includes subscription to payroll management package.
11,900 0.06 22 67
Have a higher excess than standard to save premiums and self insure the small stuff where appropriate. Have a $1000 excess on most things. Included under insurance is key person insurance, which has a 13 week stand down to reduce premiums but is good cover if something major happens.
15,500 0.07 29 88
Includes ACC for 1 FTE of owners cover and ACC for employees.
4,700 0.02 9 27
Council and regional rates for both farms.
21,400 0.10 40 121
TOTAL FARM WORKING EXPENSES 902,100 4.30 1,686 5,097
CASH OPERATING SURPLUS 752,400 3.58 1,406 4,251

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.

Value of change in Dairy livestock
There will be minimal change in number of livestock on hand for the season.
1,350 0.01 3 8
Labour adjustment
This covers 1.25 FTE of unpaid owner input, including all on farm work, administration, strategic planning and governance.
120,000 0.57 224 678
Feed inventory adjustment
Feed on hand should not change significantly.
0 0.00 0 0
Based on previous years financial statements plus allowance for addition of new farm lease block.
50,000 0.24 93 282
DAIRY GROSS FARM REVENUE 1,655,850 7.88 3,095 9,355
DAIRY OPERATING EXPENSES 1,072,100 5.11 2,004 6,057
DAIRY OPERATING PROFIT 583,750 2.78 1,091 3,298

More budget case study farms

Want to see how the top operators are spending their money? Are there areas for improvement in your own business where savings can be made? We’ve collected in-depth current season budgets from a number of top performing farms with a focus on lower ‘per unit’ cost of production to help you identify opportunities.

Last updated: Sep 2023
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