So who's behind new dairy company?

Synlait Investments Ltd directors, from left, Ben Dingle, Ruth Richardson, John Penno and Juliet Maclean. Picture / Mark Mitchell

Fonterra's newest rival, Synlait Investments Ltd, was initiated when dairy farming partners Ben Dingle and his partner Juliet Maclean, a Nuffield scholar, started looking for expansion opportunities.

They were dairy farming in the Waikato and Northland and were friends with dairy scientist John Penno, based at Rurakura near Hamilton.

"We knew we could work together and thought we could buy a farm, rack up production and sell it," said a statement from Mr Dingle, who is chief operating officer for Synlait.

They bought an 870ha sheep and beef farm, Robindale, near Hororata in Canterbury, in 2000, shortly before a dairy company moratorium on new suppliers was lifted, and converted it to milk 3300 cows.

"There was a big question mark over water availability," he said. "The perception was that we were taking a big risk but we found water, sourced capital and the moratorium came off at the same time."

The three friends then decided to create an international dairy business and 18 months ago invited former finance minister Ruth Richardson to join their board.

"We firmly believe there is a place in New Zealand for this type of operation, which involves building equity partnerships and giving farmers the opportunity to have a stake in the industry," Mr Dingle said.

Synlait has an average stake of about 30 per cent in each of its farms. It also has management contracts with each of the businesses, which are operated by "equity managers" -- farmers who have a stake of about 10 per cent.

When Synlait looks for outside investors to boost capital funding, it is expected to offer separate investments in the farms and its manufacturing and marketing arm.

Mr Dingle said the company's founding directors were also in the business for the challenge: "We don't farm to be average. We have high expectations".

Next season the Synlait operation will milk a total of 9500 cows off 2800ha, producing 45 million litres of milk (equivalent to 3.75 million kg milksolids). Its farms average 1400kg milksolids/ha or 380kg-400kg milksolids/cow. The venture has so far established four other farms within a 15km radius, in addition to the original Robindale Dairies, including:

* Terraceview, 150ha milking 650 cows;
* Ngamarua, 370ha milking 1500 cows;
* Riverlands, 525ha milking 1800 cows; and
* Moreton Marsh, 308ha milking 1150 cows.

Decade Dairies, a 150ha farm near Ashburton, milking 520 will be added to the company on June 1, along with another farm, currently held by one of a number of companies run by Mr Penno under the business name Delaborin, an acronym for the partners' first farm.

That farm, Robindale, is the largest single-site dairy operation in the country -- milking 12 hours a day through an 80-bail rotary platform.

Farm staff work a six-days-on, two-off roster averaging about 50 hours a week, and at milking, where five staff are required, no one works more than three hours at any milking to avoid tiredness and boredom.

Farms are irrigated through centre pivot and roto-rainers with sensors to monitor water use.

Mr Dingle said farming practices were changing with industry trends and the company would respond to current welfare concerns by reducing induced births, and cutting back on use of controlled internal drug release (CIDR) implants to manipulate and synchronise calving, and bring anoestrus cows into season.

It will soon have no docked cows, in light of welfare code changes expected to soon outlaw docking tails.

"We consider each cow as a critical customer and we respect them because they are vital to our business," Mr Dingle said.

- NZPA