Store more feed was lesson from drought for Atihau

By laurel.stowell@wanganuichronicle.co.nz

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It was the best of times, then the worst of times for one of the region's biggest farming operations, reports Laurel Stowell

The Atihau Whanganui Incorporation is principally a sheep and cattle farmer with dairy and forestry interests in the Waimarino district. It has about 41,700ha, with  29,400ha  farmed.
The Atihau Whanganui Incorporation is principally a sheep and cattle farmer with dairy and forestry interests in the Waimarino district. It has about 41,700ha, with 29,400ha farmed.

If 2012 was a season from heaven for the Atihau Whanganui Incorporation's agribusiness then 2013 was a season from hell, chief executive Chris Scanlon said.

The incorporation faced a double whammy of low prices and the worst drought since the 1970s.

"We got whacked just like everybody else did," Mr Scanlon said.

The incorporation held its annual meeting at the Wanganui Racecourse on Friday, with a catered dinner for 680 people.

It was the first annual meeting to be held with a woman chairing its board of management. Mavis Mullins took over that role from Dana Blackburn this year.

Her new role, and thanks to Mr Blackburn for his 18 years' service, were features of the meeting.

The incorporation has 7000 shareholders, who received a dividend of 55 cents per share this year - compared with 75 cents last season.

Mr Scanlon said people were disappointed by the reduced dividend but accepted his explanations and didn't ask many questions.

There were three main reasons for the lower result - lower prices, the drought and the need to lease extra grazing.

Lambs sold for an average $123 in 2012, and $70 in 2013. They also weighed an average of 3kg less.

In the 2013 season, cattle sold for an average of $1000 rather than the previous high of $1400.

Many stock had to be sold early because there was not enough feed. The incorporation had to compete with other farms for killing space.

It had been prepared for a small drought, but not a big one.

And it had had to spend an extra $1million on leasing grazing for stock with good genetics that would be needed for future breeding. Some 13,300 ewe hoggets, 700 mixed-age cows and 1800 steers and heifers had to be sent elsewhere.

It was lucky the decision to buy grazing was made early, Mr Scanlon said.

It would have cost even more if it had been made later.

One of the lessons that had come out of the drought was to store more feed.

Like a lot of other farm operations, the incorporation was now cutting extra grass and storing it in silage pits. It is also putting in more winter crops than usual.

"Should we get hit by another big one, we won't have to spend as much extra money. We'll do it in house."

Mr Scanlon said droughts were now more likely to be the norm than the exception. The operation had also reduced stock numbers from 200,000 to 180,000 - more like the usual winter level.

After all the difficulties, the incorporation had come through with stock and land in good shape, and expected to pick itself up quickly.

Prices were improving. Plentiful rain had made grass grow fast, but also washed out bridges, fences, tracks and culverts. Lack of sunshine had delayed docking.

Mr Scanlon said last season might have been lousy for stock, but it was tremendous for honey. The incorporation had 1500 hives on its farms, in a partnership deal with Wairarapa-based Maori apiarists Watson & Son. It was looking at doubling that number this year.

It would also like to join other Maori agribusinesses to form a relationship with a meat company.

Mr Scanlon would not say which company. "Rather than us and the meat companies battle over a price between the two of us we'd like to become integrated with one to produce something together." Talks were at an early stage.

Atihau Whanganui Incorporation
* 7000 shareholders
* 42,000ha of land
* 30,000 farmable
* 8 properties
* 36 full time staff
* 180,000 stock

- Wanganui Chronicle

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