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Farm facts Numbers at a glance Management decisions 2026-27 forecast budget Additional resources

Success for this Western Southland farm is driven by a simple, pasture based farm system that is implemented by excellent farm staff. Farm and financial management ensures operating expenses remain below industry average. 

This 575 cow, 165 eff ha dairy farm is in Western Southland. The owners live off farm and rely on an excellent on farm team to implement their simple, pasture based farm system.

The high performing, high BW/PW Jersey herd consistently produces over 110% of their bodyweight per cow, and the farm production average has exceeded 1,500 kg MS/ha for the last 4 years.

Farm and financial management aims to keep operating costs below the industry average.

Western Southland Case Study 1000X750
Farm Facts

Business type: 

Owner-operator

Location: 

Western Southland

Farm size:

165 ha effective milking platform, no support land

Soil type:

Waimatuku predominantly silt loam 25–30% topsoil clay content, typically stone-free adequately drained

Peak cows: 

575 Jersey

PSC: 

10/08/2025 MA cows, heifers 1 week earlier

Stocking rate: 

3.48 cows/ha

Farm system: 

4 (21-30% feed imported)

Wintering system:

100% of the herd wintered off 8-9 weeks

Production 2026/27

270,000 kgMS/year budget, 1,636 kgMS/ha, 470 kgMS/cow, ( year average is kgMS/ha, kgMS/cow)

Production (last 3 years):

260,000 kgMS/year

Numbers at a glance

Financial KPI 2026-27 budget updated April 2026
Net dairy cash income ($/kgMS) Total farm working expenses ($/kgMS) Total operating expenses ($/kgMS) Dairy operating profit ($/ha)
$9.82 $5.57 $5.83 $6,512
Physical KPI 3 year average
Pasture and crop harvested (t DM/ha) Purchased N surplus (kg N/ha/yr) GHG (t CO2 equiv/ha/yr) Six week in-calf rate (%)
12.8 180 NA 70

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

Management decisions

Strategy and financial

Financial management

Key financial focus is to control costs and have low capital expenditure to enable aggressive debt repayment.
In house management of coding, GST, payroll, budgeting and variance reporting using Xero/Figured allows for frequent monitoring of cash position.
Fully review current position and update budget every quarter, with two to three catch ups with the accountant per year.

Benchmark

Use accountant benchmark data (from their own client database), and other local and industry information eg Woodlands research Farm

Environment

Follow best practice for late winter and early spring crop grazing to minimise pasture damage and runoff.
Future plans include native planting. Fonterra planting grant for 25-26 season has provided 200 plants for existing unproductive areas.
Currently in Fonterra's ecopond trial.  

 

Farm policy and infrastructure

Infrastructure

  • The 575 cow herd is run in two mobs and milked through a 40 aside herringbone shed which has in shed feeding.
  • The farm is flat and it is 1.5 km from the farm dairy to the furthest paddock (about a 0 minute walk).
  • Tracks, fencing and water supply infrastructure are in good order and maintained regularly.
  • Facilities for staff housing, calf rearing, implement and feed storage are good.
  • The farm doesn't have any off-paddock infrastructure except a wood chip calving pad.

Policy

  • The business is based on a farm production system 3-4, with a total of 1.7 t DM /cow imported feed (supplements and off farm grazing).
  • Feeding decisions are based on a pasture first philosophy and supplementation is based around this.
  • In-shed feeding is used throughout lactation, particularly to extend early and late lactation.
  •  About 1 t DM /cow of imported feed is fed. Rates of feeding through the season vary depending on pasture supply.
  • Silage/baleage, (made on farm), is only fed in the shoulders of the season and with crop in late winter/early spring.
  • The herd is Jersey, and stocking rate sits around 3.4 cows/ha.
  • All young stock are grazed at a third-party support block from weaning.
  • Cows and in-calf heifers are wintered off farm for 8-9 weeks at third party grazing. 

Environment

Soil fertility, fertiliser and N applied
Follow Ballance recommendations and usually use close to 170-180 units of N/ha.
All paddock soil testing is done every 5 years. 
Crop paddocks are tested prior to planting.

Water use
Water supply is from a metered bore.
Use is monitored and reported every year as part of the consent.
Water quality is good.

Shelter and riparian planting
The farm has plenty of shelterbelts, predominantly Macrocarpa, which are trimmed every 3 years.

Pasture and Feed

  • Focus is on efficient pasture utilisation.
  • Pasture surpluses in the spring and early summer are managed through the cropping and regrassing policy and harvesting for silage/baleage. 
  • A larger area of the milking platform is removed to make silage in late January or early February.
  • Balage is used on crop for cows to come back to after wintering and silage is used for springers on bark chip feed pad in paddocks.
  • Weekly farm walks are completed on farm which are entered into MINDA Land and Feed.  Feed wedge information is utilised in terms of key pasture management decisions.   
  • Attention is on minimising pasture damage from pugging, as the farm can experience very wet spring conditions. The soil typically can hold a lot of moisture which is when permanent damage can occur. 
  • The farm has no infrastructure for standing stock off paddock, so wet periods are managed by proactively moving stock on. The feed budget factors in this extra grass used.
  • The Spring Rotation Planner is used for the calving period, with the first round, (for a PSC of 10 August for MA cows), being targeted to finish after the 25th of September.  
  • After balance date cows will be on a 23-day rotation through to Christmas, then budget on 25 days to end of January, then it will be pushed out to 30 days.  Aim is to be at 40 days in late April.
  • On average  ha of Swedes are planted each year, which with baleage, is used for cows to come home to prior to calving.
  • Silage/baleage is usually made on farm, (about 25 ha on average), but more can be sourced elsewhere in a lower growth year. 
  • The aim is to regrass about 12-13% of effective farm area per year which is 22 ha per year. This is made up of 9-10% grass to grass and 3-4% crop to grass.
  • Imported concentrates fed in a typical season are a mix of 80% PKE, 10% PKE 10, (10% molasses) and 10% DDG for a planned total of 575 t DM.

Herd

  • The Jersey herd, is of high genetic merit with a herd average BW 194 and PW 208. Herd is not currently DNA tested but is joining the LIC SPS this season and will be tested going forward. 
  • The 5-year average 6 Week in calf (WIC) is 72% and empty rate 10%. Typically, 50 CIDRs were used per year.
  • The 2026-27 plan is to not use any CIDR’s or anoestrous treatments. 
  • Mating is for 10 weeks, made up of 6 weeks of AB using Jersey semen, (bottom 30% on BW/PW mated to beef), then bulls run with herd for 4 weeks.
  • 150 replacements are reared annually. Calves are reared on milk, meal and hay and weaned at 85 kg live weight.
  • 4-day old Jersey bulls sold to a calf rearer and the balance of calves sold as bobbies.
  • There is a strong focus on Body Condition score recommendations including any cows less than 4.5 BCS in March going on Once a Day milking.  All cows got to OAD form the beginning of May.
  • Calibration of body condition scoring is done annually with the vet.
  • There are no major metabolic issues as a proactive approach is taken to ensure supplementation is appropriate. Minerals are administered via Dosatron and an in shed feed crumble. This crumble use is being reviewed as it is a large cost.
  • Average SCC is 140,000 to 150,000 (5 year average). Cows over 100,000 SCC are treated with dry cow therapy and teat seal, balance of herd including in-calf heifers are teat sealed only.

People, health and safety

  • 100% of the workforce is recruited through existing connections. 
  • Staff retention is high No one has left business in five years, which is a credit to the farm manager and his team culture.
  • Follow best practice for health and safety and have a good record.
  • Have clear and simple policies that are easy to implement.
  • There is frequent staff contact to ensure everything is on track.

2026-27 Forecast Budget

Budget updated April 2026

INCOME $TOTAL $/KgMS $/COW $/HA
Net Milk Sales
Milk income is based on 270,000 kgMS at an advance of $8.00 and 270,000 kgMS, (target for 2025-26 season), at a deferred price of $1.45. 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.
2,543,300 9.42 4,423 15.414
Net Dairy Livestock Sales
Based on 120 MA cull cows @ $750/head, 10 empty R 2 heifers @700/head, 120 Jersey bull calf sales @ $80/head, 250 bobbies @30/head plus 10 breeding bulls bought and sold for a net costs of $600/head.
108,100 0.40 188 655
Other Dairy Cash Income
NET DAIRY CASH INCOME 2,651,400 9.82 4,611 16,069
EXPENSES $TOTAL $/KgMS $/COW $/HA
Wages(incl. ACC)
Budgeted for 1 Farm manager, 1 herd manager, 1 farm assistant, a calf rearer and casual relief milker. This equates to 3.4 FTE. This is net of rent and includes PAYE and Kiwisaver payments.
254,000 0.94 442 1,539
Animal health
Includes $29,000 for minerals administered via Dosatron and an in shed feed crumble. Cows over 100,000 SCC are treated with dry cow therapy and teat seal, balance of herd including in-calf heifers are teat sealed only.
83,000 0.31 144 503
Breeding and herd improvement
Includes herd testing, MINDA, scanning, ear tags and tail paint. Will be part of sire proving scheme from 2026-27 which will cover DNA testing the herd. Budget covers 6 weeks of AB using Jersey semen, (bottom 30% on BW/PW mated to beef), then bulls run with herd for 5 weeks. The 6 week in calf rate for 2025 mating is 76%. The costs also cover pregnancy scanning. No anoestrous or synchrony treatments planned for the 2026 mating. Six week in calf rate is 72% and empty rate is 10%, (5 year averages).
40,600 0.15 71 246
Farm dairy
Follow standard plant cleaning recommendations. Covers detergents, and shed consumables.
16,200 0.06 28 98
Electricity(farm dairy, water supply)
Budget based on current costs plus 15% expected increases. Shed is 40 aside herringbone with cup removers. Herd is milked twice a day all season. Milking is done with 2 people in shed including bringing in 2 herds. At the peak, milking takes about 4 hours in the morning and 3 hours in the afternoon,
37,000 0.14 64 224
Supplements made(incl. Contractors)
400 bales of baleage @ $0.20/kgDM and 50 t DM of silage @ $150/t DM ($0.15/kgDM). Cost covers everything except mowing.
25,500 0.09 44 155
Supplements purchased
A mix of 80% PKE, 10% PKE 10 (10% molasses) and 10% DDG is planned with a total of 575 t DM budgeted, (1000 kgDM/cow). The average price of $506/t DM including cartage.
291,300 1.08 507 1,765
Calf rearing
150 heifer replacement calves are reared on milk, meal and hay and are weaned at 85 kg live weight. Costs cover meal and hay.
12,000 0.04 21 73
Young and drystock grazing
145 weaners for 5 months, 147 R 2 heifers 11 months, 135 R 2 for 4 weeks @ May grazing price, 20 carry over cows for a full year. Includes stock freight.
171,000 0.63 297 1,036
Winter grazing
595 MA cows and in calf heifers for 8-9 weeks. Includes stock freight.
227,000 0.84 395 1,376
Fertiliser(incl. N)
Soil test all paddocks once every 5 years, (due this season). Fertiliser applied is based on soil test recommendations. Includes 6-7 applications of nitrogen with a total of 175 units N/ha applied. First application for the season is phased N quickstart with Selenium for whole farm, then urea is used.
168,200 0.62 293 1,019
Regrassing & cropping
Covers contractors for spring cultivation and planting, plus seed and weed and pest control for winter crop, (swedes), and spring regrassing. The budget is for 15 ha of grass to grass, approx 5 ha of crop to grass and approx 5 ha of grass to crop. So from October to January approx 25 ha are staggered out of rotation, (not including and silage/baleage areas).
31,000 0.11 54 188
Weed and pest 4,000 0.01 7 24
Vehicles & fuel
Covers truck, tractor and Bike costs plus $25,000 for fuel.
45,200 0.17 79 274
R&M(land, buildings, plant, machinery)
Includes wood chip, cowshed maintenance, farm dwellings, tracks and races and fencing and yards. Does not include shelterbelt trimming for this year - this is done every two to three years.
36,500 0.14 63 221
Freight and general farm expenses
General freight and cartage and bio-security levy .
11,200 0.04 19 68
Administration
Accountant, bank charges and consultant fees. Other admin costs are covered via the unpaid owner input labour adjustment.
12,800 0.05 22 78
Insurance 16,000 0.06 28 97
ACC
Staff ACC costs. Owners work predominantly off farm so their ACC is not covered by this business.
5,600  0.02  10  34 
Rates 16,900 0.06 29 102
TOTAL FARM WORKING EXPENSES 1,505,000 5.57 2,617 9,121
CASH OPERATING SURPLUS 1,146,400 4.25 1,994 6,948

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.

$TOTAL $/KgMS $/COW $/HA
Value of change in Dairy livestock
Minimal change in livestock numbers. Expect to have 10 more R2 on hand and 10 less MA cows. Based on 2025 IRD NAMV.
-2,900 -0.01 -5 -18
Labour adjustment
This is for unpaid owner input for about 300 hours (0.125 FTE) and covers administration, farm oversight and governance.
24,000 0.09 42 145
Feed inventory adjustment
Budget is for no significant change in supplements on hand for the season.
0.00 0.00 0.00 0.00
Depreciation
The business owns minimal farm vehicles and plant. Some additional equipment is shared with a neighbouring farm. Depreciation is based on prior years depreciation plus an allowance for the shared plant.
45,000 0.17 78 273
DAIRY GROSS FARM REVENUE 2,648,500 9.81 4,606 16,052
DAIRY OPERATING EXPENSES 1,574,000 5.83 2,737 9,539
DAIRY OPERATING PROFIT 1,074,500 3.98 1,869 6,512

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.

Additional resources

Budgeting

/business/budgeting/

Benchmarking

/business/dairybase/benchmarking/

Top Tips

/business/budgeting/tactics-for-managing-your-farm-business/
Last updated: Apr 2026
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