Waikato farmers named 2020 Dairy Business of the Year

Waikato farmers Nadine and Richard McCullough. Photo / Supplied

A Waikato farm that has previously been a joint runner-up in the Dairy Business of the Year contest has gone one better to take the top spot this year.

McCullough Farm Partnership owned by Richard and Nadine McCullough were last night announced as the Supreme Award winners for 2020.

Northland farm Imeson Country, run by Greg and Janelle Imeson, were awarded Runners-up.

McCullough Farm Partnership is a 245 effective ha farm milking 630 cows at Karapiro in partnership with Richard's parents Bruce and Wyn McCullough.

The partnership also won the Best Waikato Farm Performance and Lowest Environmental Impact awards for the second year running.

The McCulloughs showed excellent return on assets at 6.2 per cent, continuing a strong run in the most important single measure of business performance. They also achieved an excellent operating profit margin of 44 per cent.

For every dollar of income generated they retained a high proportion as profit, which enhanced business resilience as it provided a buffer for changes in performance.

They had good cost control as demonstrated by their low cost of production of $4.46/kg MS. While their income per hectare is below average, tight control of costs have resulted in good profit per hectare.

Their high proportion of homegrown feed (12.3 tonnes of dry matter a hectare) allowed the partnership to control the amount and price of their supplements and adds to overall farm resilience.

In the Lowest Environmental Impact category, the McCulloughs had the highest environmental score of 10 out of 15 for low nitrogen leaching (26kgN/ha/year), spreading effluent over 54 per cent of the farm and significant effluent storage, feedpad use and having 100 per cent of waterways fenced and half of riparian areas planted.

The McCulloughs attribute their success to their genuine love of the land, forward-thinking farming practices and willingness to learn and develop.

Judges Michael Lawrence from Naylor Lawrence and Associates and Massey University dairy production systems expert Professor Danny Donaghy said "McCullough Farm Partnership managed to buffer the drop in payout by maintaining a return on capital that is more than 6 per cent. A big strength was their consistency.

"They performed consistently well against all metrics and had the second highest return on capital overall, second highest total profit score, highest environmental score and were in the top 10 per cent for human resources.

"This year's Environmental award was again a tightly contested race. Many farms demonstrated improved environmental performance from previous years and others clearly have made sustainable land use their passion.

"The overall winner and runner-up were primarily determined by the environmental score received as a result of the DBOY analysis, however, wider environmental initiatives are considered during the judging process.

Greg and Janelle Imeson. Photo / Supplied

Imeson Country is a 74ha farm in Northland milking 192 cows. It also won the Best Northland Farm Performance and High Input with Best Financials awards.

It has an exceptional return on assets of 7.1 per cent. It is based on very low operating expenses/ha helped by a relatively low asset value.

The Imesons achieved a low cost of production of $4.14/kg MS with variable costs/kg MS particularly well controlled. That is a key feature of a resilient business because it provides a buffer for changes in market prices or climatic conditions.

The operating profit margin was a relatively high 39 per cent achieved through a combination of relatively high milk price and low operating costs creating a high margin.

The judges said "The Imesons have produced two consecutive seasons of very consistent results, a tribute to their management skills".

"They had the highest return on capital, highest total profit score, are in the 5 per cent for environment, which they demonstrated is a real passion. Their operation was quite different with 192 cows and owner-operated. They are a highly driven couple focused on maximising their results."

Listen to Jamie Mackay interview 2013 Dairy Woman of the Year, Justine Kidd about the 2020 Dairy Business of the Year Awards:

The Business Resilience Award – lowest cost of production per kg MS was won by Brent and Rebecca Miller and Andrew and Rachele Morris from River Terrace Dairy at Carew in Mid-Canterbury. They also won Best Canterbury Farm Performance, Business Resilience Lowest CoP, Medium Input with Best Financials and the Best People Leadership awards.
The Millers are lower-order sharemilkers on the 273ha farm owned by the Morrises milking 1120 cows.

"They had the lowest cost of production at $3.93/kg MS, a small increase on the previous year when they were $3.84 and also won this award. With pasture at 81 per cent of feed input they achieved an impressive 502kg MS/cow. A business with strong and consistent performance," the judges said.

All 2020 winners will hold Regional Optimisation Days on their farms later this year to highlight how they run resilient and profitable systems.

The Hopkins Farming Group, Waihora, Shawn Southee, won Best Lower North Island Farm Performance and was runner-up for Lowest Environmental Impact. Craigellachie Dairy Farms, Andy and Alan Grant, won Low Input with Best Financials.

Other finalists included Greenacres (Kereone), Brad and Graham Pickett, Waikato; GE and KM Coxon, Gavin and Karla Coxon, Waikato; Campbell Farms, George Campbell, Waikato; Ruapuna Farms, Grant and Jan Early and Nick and Tina Giera, Canterbury; and Hopkins Farming Group – Tokomaru, Javier Pardo, Lower North Island.