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In 10: Keeping pasture and profit goals on track through change · Talking Dairy

• 0:01
  SPEAKER_01: Ki ora and welcome to Talking Dating Teen.
• 0:04
  SPEAKER_01: I'm your host, Virginia Serra.
• 0:07
  SPEAKER_01: In November 2024, Leighton and Hailey Parker hosted a very successful Pascha summer event in Canterbury with around 280 people in attendance.
• 0:18
  SPEAKER_01: They were excellent hosts who share with us their impressive career progression and equity growth based on sound farming principles and implementation.
• 0:29
  SPEAKER_01: Their farm stood out for strong cost control and profitability, high pasture-eaten prehictia, and great results.
• 0:38
  SPEAKER_01: Two years on, now on a different farm, we are catching up with Leytan to hear what they've been up to, how their plans are tracking, and what are the next steps.
• 0:49
  SPEAKER_01: So hi Leytan, great to have you on the show.
• 0:52
  SPEAKER_02: Great to be here, Virginia.
• 0:54
  SPEAKER_01: How are you doing?
• 0:55
  SPEAKER_02: I'm doing well.
• 0:56
  SPEAKER_01: Excellent.
• 0:57
  SPEAKER_01: I have the pleasure of working with Leytan many, many, many years ago.
• 1:02
  SPEAKER_01: So it's great to see his amazing career progression.
• 1:06
  SPEAKER_01: So, can you, for people that may not know you or outside of Canterbury, can you tell us a little bit about yourself, including your farming background and where are you farming now?
• 1:18
  SPEAKER_03: Yeah, well, I guess going back to the beginning, I graduated from Massa University with an undergrad and postgraduate honours in agriculture.
• 1:27
  SPEAKER_03: From there, I spent a little bit of time in Africa and then came back to working with Dairy and Z for two and a half years.
• 1:34
  SPEAKER_03: And then I had a stint with Dairy Holdings, went contract milking, did a few senior roles, a bit of advisory with them.
• 1:43
  SPEAKER_03: Had a period where things were getting a little bit unsustainable, was running too many farms, work-life balance wasn't very good.
• 1:50
  SPEAKER_03: So we actually ended up getting out of dairy for about five, six years.
• 1:55
  SPEAKER_03: At that point, I joined Perin Ag as a senior farm advisor.
• 2:00
  SPEAKER_03: And then after a couple of years, I got the opportunity to buy into that business.
• 2:05
  SPEAKER_03: Great group of people, learnt a lot, had a really good group of clients.
• 2:09
  SPEAKER_03: Had an opportunity to purchase a farm with Mark and Devin Slee in Canterbury.
• 2:15
  SPEAKER_03: So we weren't planning on it.
• 2:17
  SPEAKER_03: It was something that just came up out of the blue, but great opportunity.
• 2:21
  SPEAKER_03: And we purchased a farm just south of Ashburton.
• 2:24
  SPEAKER_03: 600 cows, spent four years developing that and improving performance.
• 2:30
  SPEAKER_03: And then more recently, we we sold that farm and then purchased a thousand cow farm 10 minutes north of Ashburton.
• 2:37
  SPEAKER_03: That's where we are now.
• 2:39
  SPEAKER_01: So late on a new farm, can you tell us a little bit more about that?
• 2:44
  SPEAKER_01: And who are you in equity partnership with?
• 2:47
  SPEAKER_03: So we're on a thousand cow farm in mid-Canterbury, 292 hectares, 60 bar rotary, fully irrigated.
• 2:55
  SPEAKER_03: We're in an equity partnership with Mark and Devin Slee.
• 2:59
  SPEAKER_03: So we've got 35% of the farm, and they've got the balance, and they've just been a fantastic couple that has sort of been there to provide great opportunity, and we've grown the business together.
• 3:11
  SPEAKER_03: So really good to be in business or thing.
• 3:14
  SPEAKER_01: So when you hosted Pascha Summit in 2024, what goals did you have then?
• 3:20
  SPEAKER_01: What were the things that you were trying to achieve?
• 3:23
  SPEAKER_03: So our primary goal was around farm ownership.
• 3:26
  SPEAKER_03: We haven't necessarily had our goals written down, but the drive to own land, own our own farm has really been the key driver.
• 3:36
  SPEAKER_01: That's great.
• 3:36
  SPEAKER_01: And it's great to have, I guess, the North Star later and then be open to opportunities.
• 3:42
  SPEAKER_01: So two years on, how are those plans tracking?
• 3:46
  SPEAKER_03: Tracking really well.
• 3:48
  SPEAKER_03: The business is performing well.
• 3:50
  SPEAKER_03: We spent a couple years developing the new farm that we're on.
• 3:54
  SPEAKER_03: So last year it was a little bit depressing because it felt like I was starting again.
• 3:59
  SPEAKER_03: We were fixing a lot of the stuff that we had done on the previous farm, and it's hard work because you're you're not necessarily following yourself and having things set up the way that you'd want it.
• 4:10
  SPEAKER_03: But we've sort of come through that period.
• 4:13
  SPEAKER_03: It was interesting the other day.
• 4:15
  SPEAKER_03: I spent a little bit of time just tracking how our business had performed over the last sort of five to six years.
• 4:21
  SPEAKER_03: And you know, compound growth is about 50% year-on-year equity growth.
• 4:27
  SPEAKER_03: But our initial growth was a lot of it was driven by profitability.
• 4:31
  SPEAKER_03: And then the last couple of years it's really been from asset prices just going crazy.
• 4:37
  SPEAKER_03: So it's great to see your wealth potentially created on a sort of paper numbers is increasing, but it doesn't necessarily drive more profit out of the business or make it easier to purchase a bigger share of the farm that we're in equity partnership with.
• 4:54
  SPEAKER_03: So for example, what if you said our share value a couple of years ago was a dollar, just with the increased asset prices, it's now$1.87.
• 5:05
  SPEAKER_03: So the business profitability hasn't necessarily improved that much, but the ability for us to be able to buy shares has actually weakened.
• 5:16
  SPEAKER_03: So our next tranche of buying another 5%, 10% of the farm is actually a little bit harder now.
• 5:21
  SPEAKER_03: So it's quite interesting times.
• 5:24
  SPEAKER_01: Leighton, when you hosted the event in November in 2024, you and the team presented quite strong messages around how you were running your farm systems and the things that were really important to you to achieve the results.
• 5:40
  SPEAKER_01: I guess the question is: are they still the same principles apply on the new farm?
• 5:46
  SPEAKER_01: And for people that weren't at the die, could you perhaps outline those things that are very important to you to achieve the results?
• 5:53
  SPEAKER_03: Yeah, I guess we are pretty consistent with our business philosophies and farming principles that we follow.
• 6:00
  SPEAKER_03: A lot of it comes down to using good science to drive good decision making.
• 6:05
  SPEAKER_03: We understand that land is the core asset.
• 6:08
  SPEAKER_03: That's what holds most of the value in our business.
• 6:11
  SPEAKER_03: So we need to optimize the performance of that van to optimise the performance of the business.
• 6:18
  SPEAKER_03: We understand that operating a low cost structure helps drive a high margin out of the business, and that's a key part for driving profitability.
• 6:27
  SPEAKER_03: We've got to make the milk and do good production, but the margin that we get from that is critical.
• 6:32
  SPEAKER_03: And we come back to pasture eating is so critical for achieving a low cost of production as well, because we're trying to achieve that through not purchasing expensive supplement, through having expensive gear to run, but putting the cows in the paddock, grazing the pasture and harvesting as much energy and feed as we can from that land.
• 6:55
  SPEAKER_01: So you mentioned bacha eating prehiktia being an important element on you achieving the results of the system.
• 7:03
  SPEAKER_01: What are the key elements to achieve that?
• 7:06
  SPEAKER_01: How do you do it?
• 7:08
  SPEAKER_03: Yeah, so I guess the first part is to have your stocking rate, carving date all set right, so we're not having to put too much supplement in the right points, and effectively we're building a high grazing intensity to utilize that spring flush.
• 7:24
  SPEAKER_03: And then we really come back to those basic principles around three-leaf stage.
• 7:30
  SPEAKER_03: The biggest driver for growing quality feed and harvesting energy per hectare is round length management and residual management.
• 7:39
  SPEAKER_03: So we make sure that we do a good job of that.
• 7:42
  SPEAKER_03: Also recognising our underperforming paddocks so at the end of the season, we can evaluate the paddocks that are at the bottom 20%, and we can look at them and say, is it a species issue?
• 7:54
  SPEAKER_03: Do they need to be resunned?
• 7:56
  SPEAKER_03: Is there a fertility problem there?
• 7:58
  SPEAKER_03: Is our irrigation performance not quite right?
• 8:00
  SPEAKER_03: So we've got a strong focus on investing into making sure that our water from our irrigation is distributed evenly at the right times around the farm, that we're using our fertiliser in the right areas and at the right times to drive a high response rate.
• 8:18
  SPEAKER_03: And also we're driving good species within those swords.
• 8:23
  SPEAKER_03: And we also, this is a bit of a thing that's a bit more specific to myself and the way that I like to farm, but we use a lot of perennial diploids, just feel like we're able to manage a steeper wedge and hold more feed through that spring period, which is real critical for us because we ran a high stocking rate, around four cows to the hectare.
• 8:48
  SPEAKER_03: And we also focus on clover, which is a critical part of the sward, driving and fixation, but also we can maintain high feed quality with higher covers.
• 9:00
  SPEAKER_03: So that clover component is really critical, high digestibility, maintain quality with those higher covers.
• 9:07
  SPEAKER_01: What you're saying is the combination of the strategic right decisions and also all the tactical decisions that you have to be making throughout the season.
• 9:15
  SPEAKER_01: So both of them are important to achieve the results.
• 9:19
  SPEAKER_01: So what have been the key things that really has made a difference in the performance of your business and growth?
• 9:25
  SPEAKER_01: What are the non-negotiable for you?
• 9:28
  SPEAKER_03: Coming back to that key focus on pasture, cost control is so critical.
• 9:33
  SPEAKER_03: So we manage that through using zero.
• 9:36
  SPEAKER_03: We keep a very close eye on our cash flow budget and how that varies relative to our budget.
• 9:43
  SPEAKER_03: We're sort of reforecasting that through the year.
• 9:46
  SPEAKER_03: And if we've got unders or overs, we question why that's happening.
• 9:50
  SPEAKER_03: What adjustments can we make within our budget to make sure that we're sort of sticking to the plan and we're driving as much cash as we can out of the business.
• 10:00
  SPEAKER_03: And then the other thing is we've got great business partners that help keep us accountable.
• 10:05
  SPEAKER_03: They've got a lot of knowledge to share, and their business is very successful.
• 10:09
  SPEAKER_03: So there's a lot of learnings between both.
• 10:13
  SPEAKER_01: Layton, when we had the field day, there were three key things that were uh highlighted the career progression and the financial performance, the pasture management and that you mentioned, and also it was the improvement in the reproductive performance of the herd, which is quite a challenge for many farmers.
• 10:32
  SPEAKER_01: How is that going now in the new farm?
• 10:35
  SPEAKER_01: And is that a focus for you?
• 10:37
  SPEAKER_01: Is there any other insights that you can share with us in how you keep lifting the repro performance of the herd?
• 10:44
  SPEAKER_03: Yeah, we had a bit more of a challenging season last year.
• 10:47
  SPEAKER_03: We had 400 North Island early carving cows, and then the spring was a little bit tricky.
• 10:53
  SPEAKER_03: So yeah, cow condition going into mating probably was the worst that it's been in the last six years.
• 10:59
  SPEAKER_03: So typically we've been sitting around that 80% six week in calf rate, and we dropped down to 78, which I was actually quite surprised because I thought it was going to be a bigger drop than that.
• 11:09
  SPEAKER_03: And the cows perform well, but I guess we had a large proportion of early carving cows.
• 11:15
  SPEAKER_03: But we've just got this continual focus on repro performance, compact carving, getting as many cows as we can in calf as early as we can, but doing that naturally, focus on the fundamentals so we don't use any intervention.
• 11:30
  SPEAKER_03: And we just have a big focus on body condition score, making sure that our feed quality is good, that they're on that rising plane of nutrition, getting into a positive energy balance, coming into mating.
• 11:43
  SPEAKER_03: If we need to help some cows out that are struggling, we'll use a bit of tactical once a day to take the pressure off them, which is a really great tool.
• 11:52
  SPEAKER_03: And we'll also use that on our later carving cows as well.
• 11:56
  SPEAKER_03: So anything that calves in October, they stay on once a day until they're mated.
• 12:01
  SPEAKER_03: So yeah, repro performance is really important for matching that demand to our spring flush, and we're trying to get cows carved as quick as we can, and that also helps that recovery period to get back and calf again.
• 12:14
  SPEAKER_01: Leighton, talking about tools and resources, what's your thinking on technology?
• 12:19
  SPEAKER_01: What's your approach to deciding if any technology you will be using on the farm?
• 12:24
  SPEAKER_01: I mean, in terms of cow wearables and things like that, or or even information and how you manage that.
• 12:31
  SPEAKER_01: What's your approach to your investment in technology?
• 12:34
  SPEAKER_03: So wearables is an interesting one.
• 12:37
  SPEAKER_03: We haven't invested in wearables yet.
• 12:40
  SPEAKER_03: It's a space that we're looking at, but at the moment we can't justify it in terms of it driving more profit.
• 12:48
  SPEAKER_03: And I guess the other thing that I'm worried about is it it brings a big focus on the cow.
• 12:54
  SPEAKER_03: And our primary focus in our business really comes down to making sure that we're managing pasture well, and those are the things that we're talking about every day.
• 13:04
  SPEAKER_03: Now, that's not to say that we're gonna have hungry cows and the cows aren't performing, because our cows are expected to do between 450 to 470 milk cellars a year, so they've got to perform.
• 13:15
  SPEAKER_03: But the things that we're talking about day to day comes back to pastures.
• 13:20
  SPEAKER_03: So if I have a conversation with my team, we're talking about residuals, round anxious, what are the pre-grazes looking like?
• 13:27
  SPEAKER_03: So that is really the key focus.
• 13:29
  SPEAKER_03: If we can make a business case and it fits into our business, it might be something that we'll do in the future.
• 13:36
  SPEAKER_03: In terms of other tools at the moment, I've been using AI a little bit more recently just with some of our data analysis and testing.
• 13:46
  SPEAKER_01: And I guess you mean artificial intelligence, not artificial insemination.
• 13:51
  SPEAKER_03: Yeah, artificial intelligence.
• 13:54
  SPEAKER_03: So a couple of examples of that, fertilizer prices have gone up quite a bit, particularly the price of sulfur.
• 14:00
  SPEAKER_03: And I used Chat GPT to run some analyses for me around putting together a bit of a fertilizer plan.
• 14:08
  SPEAKER_03: The information that you put in is really important because if if you don't ask the right questions, it's not going to drive you the right answers.
• 14:15
  SPEAKER_03: But the data processing capacity and ability to do analysis so much faster is really useful.
• 14:23
  SPEAKER_03: So I was able to put together a plan within sort of 10 to 15 minutes, whereas normally it might take me three hours to do the full analysis.
• 14:34
  SPEAKER_03: So that was a real time saving, really cool to use it for that.
• 14:39
  SPEAKER_03: And then also used it quite a bit through that winter period with designing our nutrition and feed allocation on winter crops.
• 14:48
  SPEAKER_03: And one of the big changes that we made this year because of it is we graze on fodder beet.
• 14:54
  SPEAKER_03: Fodder beet tends to be low in protein, and we've tended to front load our energy and protein in June, but we've changed that around this year to feed a lot more protein in July because the fetus requires a lot more protein to grow that calf.
• 15:13
  SPEAKER_03: So we've ended up using a lot more silage through July relative to June.
• 15:19
  SPEAKER_03: So it's been a real interesting tool for highlighting different things, but really great for data analysis and processing.
• 15:28
  SPEAKER_01: Absolutely.
• 15:29
  SPEAKER_01: Yeah, great.
• 15:30
  SPEAKER_01: Just going into more like a tactical thinking about the season, the margins are getting squeezed even with a good meal price.
• 15:39
  SPEAKER_01: I mean, our prediction of the break-even meal price, uh,$9, compounded with the impact of El Nino as well.
• 15:47
  SPEAKER_01: So, really, it is challenging out there, increasing costs.
• 15:52
  SPEAKER_01: What are your strategies for keeping?
• 15:54
  SPEAKER_01: And I know, and you mentioned that at the field that margins are very important to you and keeping that.
• 15:59
  SPEAKER_01: What's your strategy to protect that this season and seasons to come?
• 16:04
  SPEAKER_03: Yeah, it's it's a really big challenge.
• 16:07
  SPEAKER_03: Just recently, we've renegotiated our young stock grazing rates.
• 16:11
  SPEAKER_03: So our R2s uh they've gone up$3 a week, which is a pretty significant increase from where they were.
• 16:21
  SPEAKER_03: And then our winter grazing rates have have gone up significantly as well.
• 16:25
  SPEAKER_03: And there's not a huge amount that we can do in these areas because land prices have gone up.
• 16:31
  SPEAKER_03: There's a whole lot of conversions happening in Canterbury, so the demand has increased a lot.
• 16:37
  SPEAKER_03: We tend to try to make sure that feed isn't a large portion of our farm working expenses because it's very easy to drive up that break-even milk price if your feed's quite a big component.
• 16:52
  SPEAKER_03: And then also understanding those other big drivers within your costs with animal health, breeding, and then repairs and maintenance is the big one.
• 17:03
  SPEAKER_03: So they're really the big three that I focus on.
• 17:06
  SPEAKER_03: The other areas they'll sort of have minor impacts, but those three key areas of animal health and breeding, feed, repair, and maintenance, they're my big ticket items to manage and make sure that we keep them controlled and as low as we can.
• 17:22
  SPEAKER_03: And if we are invested in those areas, they've got to deliver a good sound return.
• 17:29
  SPEAKER_03: And then the other thing is making sure that we're talking with our suppliers.
• 17:33
  SPEAKER_03: A lot of people wanting to put their prices up at the moment.
• 17:36
  SPEAKER_03: I think we need to make sure that we're communicating with them to ensure those increases are fair and reasonable.
• 17:44
  SPEAKER_03: And if they're not, they need to be held to account.
• 17:47
  SPEAKER_03: We've recently changed to another supplier because we'd been with a business for five years.
• 17:54
  SPEAKER_03: Loyalty is really important to us.
• 17:56
  SPEAKER_03: So as long as you're competitive and you're doing a good job, we're going to stick with you.
• 18:00
  SPEAKER_03: But these guys' prices, they got out of hand, they weren't being competitive, so we just had to say we've got to use someone else because you're just getting too expensive.
• 18:10
  SPEAKER_03: So we're looking at those things all the time, but it's a real challenge.
• 18:15
  SPEAKER_03: Milk price seems good at the moment, but yeah, we've got a rating margins with costs increasing, and we've got to keep on top of it.
• 18:22
  SPEAKER_03: Our break-even milk price, our budget's$5.92 break-even price.
• 18:28
  SPEAKER_03: But with our feed costs going up, it's probably going to be hard to keep that under$6 this year, and it's just that continual sort of battle and challenge to manage that and try to protect margin.
• 18:43
  SPEAKER_01: Requires absolute focus and not being complacent, even as sometimes it happens when meal price is good, but costs are definitely up there.
• 18:53
  SPEAKER_01: So, Leyton, what's what's next for you?
• 18:55
  SPEAKER_01: What's in the horizon and what excites you?
• 18:58
  SPEAKER_03: I guess from the farm itself, just trying to get our new business running as efficiently as we can.
• 19:05
  SPEAKER_03: Um, we've got a great team that I want to help develop these guys and grow in their careers.
• 19:11
  SPEAKER_03: So if there's knowledge that I can pass down to them, give them growth opportunity, we're keen to do that.
• 19:18
  SPEAKER_03: And then also stepping a little bit more into the governance space.
• 19:22
  SPEAKER_03: I feel like this is an industry that's given me so much.
• 19:26
  SPEAKER_03: So if I've got some skills and ability to help contribute and help move the industry forward in the right direction and do my little bit, that's something that I want to do.
• 19:37
  SPEAKER_03: So, yeah, that's sort of the outlook for me going ahead.
• 19:41
  SPEAKER_01: Leighton, thanks for talking to us and taking us through what has happened over the last two years.
• 19:48
  SPEAKER_01: Very impressive progression, and you continue to grow the business and have excellent performance.
• 19:55
  SPEAKER_01: If you'd like to continue the conversation, Pascha Sama's next events are coming up in November.
• 20:00
  SPEAKER_01: They are hosted by farmers, for farmers in partnership with the ADNC with ideas and development on achieving profitable dairy food production with input from dairy sector specialists.
• 20:13
  SPEAKER_01: The North Island event is on Tuesday, the 24th of November, kindly hosted by Todd and Renee Halliday in Raperoa, Bay of Plenty.
• 20:23
  SPEAKER_01: The South Island event is on Thursday, 26th of November, kindly hosted by James and Laura Bowden in Heinz, Canterbury.
• 20:33
  SPEAKER_01: Whether you are a young farmer, a sector leader, or someone passionate about the future of Dairy, Pachasama is your opportunity to learn, connect, and grow.
• 20:44
  SPEAKER_01: Most information and registrations are available on the Pachasama website at pachchasama.co.inced.
• 20:52
  SPEAKER_01: Thanks for listening and catch you next time.
• 20:55
  SPEAKER_01: Matewa.
• 21:03
  SPEAKER_00: If you'd like to get connected with DariNZ's latest advice, research, tools, and resources, whether it's reading, scrolling, listening, or in person, you can visit DariNZ.co.nz forward slash get-connected, and don't forget to hit follow to keep up to date with our latest episodes.
• 21:20
  SPEAKER_00: As always, if you have any feedback on this podcast or have some ideas for future topics or guests, please email us at talkingdairy at DariNZ.co.nz.
• 21:30
  SPEAKER_00: Thanks for listening, and we'll catch you next time on Talking Dairy.