Takapau farmers Justin King and Meg Campion know how to grow great heifers and now they can rest assured the New Zealand Grazing Company has a new payment system that ensures they are fairly rewarded for their hard work.
The new payment model, Modeled Dry Matter (MDM), was revealed at the grazing company's field day last week.
Company managing director Ian Wickham says the concept has been especially developed to reward feeding dairy support cattle on a fair and equitable basis, where circumstances are variable.
"We already help people grow great heifers. Now we have a modern approach to reward growers for doing an excellent job," he says.
The model, validated by DairyNZ and approved and used by Fonterra for the export cattle in the grazing company's care, starts with the production (animal weight, weight increase etc), calculates the amount of feed used to support that production and then pays the pre-determined amount per kilogram of dry matter, with a price that has been agreed for that feed's value.
It takes into account seasonal variations, so juvenile pasture is worth more money, winter feed is worth even more, and feed in a drought is worth a lot more. A bonus is paid for every animal that reaches an agreed target weight and, conversely, a penalty on any animal that fails to reach an agreed minimum weight. It also takes into consideration animal health and other husbandry expenses, and crucial to the success of the system is an undertaking by growers to weigh animals monthly.
The field day included a tour of Mr King's Brookwood Station at Takapau to see first-hand how a successful heifer grazing system worked.
It highlighted that even in a traditionally drought-prone region such as Hawke's Bay, there is an opportunity for farmers to get into dairy support.
Mr King has been grazing dairy heifers with the grazing company for several years and now grows 1500.
He moved away from bull beef because dairy heifers stacked up the best financially, and liked the fact his whole farming operation was not reliant on speculating when to buy or sell and at what price.
"All you're worrying about is what is happening inside the farm gate," he says. "I just have to feed the heifers well, it suits me."