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TAS Country : March 15th 2012
24 Tasmanian Country Friday, March 16, 2012 Special Feature Dairy Business Awards Sound business plan is an essential tool OVER the last two seasons, the dairy sector in Tas- mania has enjoyed im- proved conditions and product prices. But prior to this, the industry endured a very challenging period of low milk prices, increasing op- erating costs, variable seasonal conditions and a changing global economic climate. Tasmanian Perpetual Trustees share the view held by many in the indus- try that Tasmania's dairy sector has a bright future. The market, economic climate and environmental conditions have always been susceptible to change. While this natural vola- tility shouldn't deter far- mers from making sound farm investment and growth plans, it should be factored into decision mak- ing and planning. A farm business plan is an important tool to ensure stability in times of change. A solid plan will include strategies and contingencies for dealing with change --- for exam- ple, periods of lower milk prices, increased cost of production, or lower pro- duction. Having the right plan in place can alleviate the sig- nificant stress that comes when challenging events occur and tough decisions have to be made. A well thought out and implemented plan also pro- vides a solid platform to assess opportunities for growth, and can demon- strate strong management capacity to financiers. Where do you start with your farm plan? An effective farm busi- ness plan should cover all facets of the business in- cluding operations, finan- ce, employment arrange- ments and any share farm arrangements. Dairy farmers in Tas- mania have access to a range of resources to sup- port the development of farm business plans, in- cluding DairyTas, which runs excellent courses and education programs. Your accountant, milk supply company, and pro- fessional advisors includ- ing your financiers, are also an excellent resource to draw upon when de- veloping, reviewing and regularly updating your farm plan. Good financial manage- ment is the key to a suc- cessful farm business plan, and to riding out challeng- ing times. Tasmanian Perpetual Trustees has been working with farmers for over 120 years. The aim is to help you to maximise your returns in the good times and be well placed to get through tougher times with mini- mal hardship. Rural and commercial managers offer sound ad- vice and a range of prod- ucts. Stocking rate key to success in raising farm profits cows/ha 3.5 2.0 +75% kg milksolids/cow 434 405 +7% kg milksolids/ha 1528 803 +90% $/kg milksolids $5.70 $5.49 +4% income, $/ha $9453 $5005 +90% costs excl finance, $/ha $5194 $3420 +52% EBIT, $/ha $4259 $1585 +170% assets, $/ha $21,018 $24,379 -14% ROA% 20% 7% +190% DBOY WINNER AVERAGE ALL % DIFFERENCE THE 20 per cent return on assets for the Dairy Busi- ness of the Year (DBOY) winner is nearly three ti- mes the 7 per cent average return for all benchmark- ing participants. The high return raises the question --- how did they do it? Comparing the pro- duction, income and costs for the winning business with the average figures for all participants pro- vides some answers. The stocking rate of 3.5 cows per hectare on the winning farm compared to the average of 2 cows per hectare was a key success factor. Production per cow was slightly higher than aver- age and the 1528kg milk- solids per hectare for the winning farm was nearly double the average of 803kg milksolids per hectare. As a result both income and earnings before in- terest and tax (EBIT) were higher than other partici- pants. Asset values for the farm, which is not in a traditional dairy area, were slightly below aver- age. The combined effect of the high EBIT and lower asset value produced the 20 per cent return on assets. The Farm Walk on the winners' Cressy prop- erty with share farmer Grant Archer and farm owner Rob Bradley on March 28 will provide the opportunity for discussion about the management strategies used to achieve the high return and plans to increase herd size from 500 to 900 cows given the success of the business. The runners-up Leigh and Kellie Schuuring Nigel and Rachel Brock LEIGH and KELLIE SCHUURING LEIGH and Kellie Schuuring are sharefarming at Mella, near Smithton, on the property owned by Grant and Kim Archer. They milk 910 Friesian and Friesian cross Jersey cows on the 293ha milking area. The herd is predominantly spring calving but about 130 cows are calved in autumn. The farm is dryland and pasture consumption of 13.7 tonnes of dry matter per hectare was achieved in the Award year. Leigh and Kellie have a strong focus on animal health from calf rearing through to the breeding program. This year the business achieved a 9 per cent return on assets with an EBIT per dairy hectare of $2429. NIGEL and RACHEL BROCK NIGEL and Rachel Brock farm at Montana, south of Deloraine. They milk 580, spring-calving cows on a milking area of 206ha with a further 194ha run-off utilised for young stock, hay and silage. Pasture consumption was 8.3 tonnes per hectare with 28 per cent of the dairy area irrigated. The Brocks have a big focus on pasture management, with rotation length based on monitoring of leaf stage and grazing when the pasture reaches 3-leaves. Calf rearing is another strength of the business with all calves stomach tubed with colostrum, a very neat calf rearing set-up and monthly monitoring of liveweight until mating. In the award year, this business achieved an 8 per cent return on assets with an EBIT per dairy hectare of $1475. We help you pull the most profit.. u pull the . while you pull the teats Burnie & Smithton. T: (03) 6431 3933 www.elst.com.au • E: firstname.lastname@example.org Elphinstone Stevens are pleased past winners of the Tasmanian Dairy Farmer of the Year Award are also our valued clients. Our dairy benchmarking aids our clients to easily locate areas of success and need of improvement within their business. Call us to arrange an appointment! 2018806-120316 Farm Walk on Winners Property Farm Walk on Winners' Property ANZ Dairy Business of the Year Wednesday 28 March 2012 765 Green Rises Road, Cressy Program: 10.00 am for 10.30 am start DairyTas welcome Judges comments Farm walk with: Grant Archer, share farmer, Rob Bradley, farm owner Lesley Irvine, TIA 12.30 pm BBQ lunch Please ph 6430 5297 or email email@example.com with numbers for catering Pastures, Processors and Productivity 2012 ANZ Dairy Business of the Year Awards Dinner Wednesday 21st March 2012 Central Coast Civic Centre - Commences 8.45am No charge for the day RSVP to DairyTas on Ph: 64322233 Email: firstname.lastname@example.org celebrate the best in Tasmania s dairy industry Central Coast Civic Centre 6.30pm Tuesday March 20th 2012 Cost is $70 per head RSVP to DairyTas by Friday March 16th 2012 Payment on the night or by arrangement with DairyTas into the future
March 8th 2012
March 22nd 2012