A profitable and environmentally sustainable bull and lamb trading business has allowed a couple to invest in their environment. Sandra Taylor reports.
Fifteen years ago, Bryce Lupton had something of an epiphany.
Having farmed Te Opu, his family’s 360-hectare effective easy rolling hill-country Northland farm in what would be considered a traditional sheep and beef breeding and finishing system for 17 years, he had a nagging thought in the back of his mind that they could be doing better.
They were only enjoying good returns two out of every six years – the other years were poor or break-even and Bryce was questioning what they could do to be generating consistent returns year-after-year.
After two bad years in a row, the Northland farmer, along with his wife Aneta, took a metaphorical step back and examined every aspect of their business.
“We brought it back to basics; what do we do? We grow grass and soil, it’s our biggest asset, so what is the most profitable and efficient way we can farm within the limitations of our soils?
“What is the best way to harvest that grass?”
Once they started looking at the business from a different aspect, a number of opportunities appeared and the couple started exploring them, but they did so with an innate knowledge of every aspect of their farm.
Farming on the shores of the Kaipara Harbour, they had both a desire and responsibility to protect this harbour while retaining their soils and the nutrients within their farm business.
Breeding ewes and heavy cows no longer stacked up from both a profitability and environmental point of view and while Bryce says he loved breeding sheep – and took great pride in the quality of his ewes, particularly their wool – they had to go.
Today the couple run a trading operation made up of Friesian bull beef and lambs and Bryce values the flexibility offered by running a trading-only policy.
‘When we have grass, we have animals and when we haven’t got grass, we haven’t got animals – with trading stock we have so many levers to pull.’
“When we have grass, we have animals and when we haven’t got grass, we haven’t got animals – with trading stock we have so many levers to pull.”
When re-evaluating their business, the coupled calculated that bulls would generate the best return on a per kilogram of drymatter grown basis and these remain an integral part of their business.
Bryce says they had to learn how to handle and farm them and for their farm, a cell grazing system was the best fit for their land.
He admits in the early days they were pushing the boundaries in terms of stocking rates and were growing 900-1000kg liveweight (LW)/ha, but a few wet winters highlighted that high stocking rates were not sustainable on their winter-wet soils.
The most efficient system for the Lupton’s operation is to buy 100-110kg weaner calves and sell then at 20-22 months of age. This means they are only wintering yearling bulls and while the majority are sold as store around 50 are sold finished at 270kg carcaseweight (CW).
Bryce says they have a client base who regularly buy their store bulls.
They buy about 440 calves every year and these are sourced from Northland and Waikato. the couple tend to buy calves in August or September so they are late autumn or very early spring calves.
All the calves are Friesian as these have the greatest resale value.
Bryce says they buy everything over the phone, using good agents who have networks throughout the North Island.
LEP a good investment
For the past three years Bryce and Aneta have been Beef + Lamb New Zealand’s environmental focus farmers.
One of the best investments the couple have made in their business in recent years was a Land Environment Plan (LEP) level 3.
They employed a professional to do the plan for them and Bryce says they now have a wealth of information sitting in the background which is used to underpin management and business decisions.
“It’s a valuable resource because it’s describing your asset.”
The information about their soils has been invaluable and has given the couple a greater understanding of the nature of the different soils over their farm.
The farm has been divided into Land Management Units based on the different soil types and while Bryce says as a farmer, he did instinctively manage the different soils types differently, the LEP reinforced that what he was doing was correct.
“The LEP is a living document and when you become more focused on the environment you start to realise you could be tweaking gnarly areas by fencing them off, planting them up and eliminating stock.
“You can see how it all comes together, how it all works.”
The couple’s care of their soil resources was acknowledged when they won the Ballance Agri-Nutrient soil management award in the 2017 Northland Ballance Farm Environment Awards along with the Beef + Lamb NZ livestock award.
Trading lambs best
As a harvester of grass, breeding ewes were not that profitable for Bryce and Anna’s class of land, generating little return for the total amount of drymatter consumed.
Trading lambs, however, ticked all the boxes in terms of profitability while protecting the soils over winter, so the Luptons moved to a winter trading lamb policy, supplying one meat processor on winter lamb contracts.
They buy 3500-4000 lambs between April and May – when the “Northland bugs” such as facial eczema, pneumonia and Barbers Pole worms have disappeared.
Some lambs are sourced from local breeders while the bulk come up from Te Kuiti, Taumaranui and Whangamomona. They do prefer terminal sire lambs but will accept whatever is available.
The lambs are initially set-up in mobs and rotated around the farm. In June they weigh all the lambs and run them into mobs according to weight. This allows for strategic management, which may mean “parking” the lighter lambs and focusing on the heavier ones – or vice-versa.
They start selling the first of these lambs – which are growing at between 80-120grams/day – in July, drafting and weighing every week until they have all gone by November.
Again, it is a flexible system as when they do have a good winter and when the price is right, they will top-up with more lambs in June or July.
Bryce explains that they work on margins and once they start processing the lambs, they get an indication of how they are yielding that season. They will then decide to either add more kilograms to the lambs they have or buy more lambs.
“You’ve got to make money and provide the market with something that it wants.”
The couple supply Wilson Hellaby in Auckland (for local trade) to the company’s specifications, but they are constantly monitoring the many variables in a lamb finishing system such as markets, weather and grass.
Bryce sees the weekly weighing as a money-making exercise, as it gives them an immediate indication of when lambs may not be doing as well as expected and the opportunity to rectify any problems.
“You can ask questions about whether it is the feed or worms or some other problem.”
The couple has invested in an automatic drafter and this enables them to weigh about 600 lambs an hour.
The advantage of winter lamb trading is it is counter-cyclical but fits with their ability to grow grass in winter. As grass is growing, both lamb growth rates and the schedule are going up.
Grass powers business
The couple run an all-grass system and their strength is their ability to grow grass all year round.
Utilisation is the challenge on wet soils, and Bryce says that’s why they went to a cell grazing system with daily shifts, but they are also aware of maintaining high pasture covers because grass grows grass – something they have learnt operating a cell grazing system.
Bryce says they do have target pasture covers upon which they try to start their rotations, but this changes every year according to the season.
“Sometimes just starting the winter rotation will help build covers.”
The calves are grazed in paddocks until mid-April or May when they are run into the 60ha cell system. At this stage they are getting close to 12 months old and have developed good immunity against internal parasites which the couple believes is important in an intensive grazing system.
The bulls go into the cells according to their weights and will stay in those groups on the cell system until December. They will be sold through January and February.
The cell system has been designed using GPS and they use polyrods and polywire wire to halve the cells for winter, with one water trough between two cells.
Over spring, summer and autumn the calves are grazing the pastures on the lamb platform, where the lambs will be grown on in winter.
This means the calves are ridding pastures of sheep parasites, while the lambs do the same for the calves over winter.
“It’s so simple and one of the greatest tools farmers have for controlling worms.
“It’s a win:win.”
This combination of bulls and lambs means they are growing 300-320kg of product/ha – some years it’s a bit more, some it’s a bit less depending on the season.
This production consistently generates a net income of $1000-$1100/ha.
The couple don’t do any re-grassing, rather they invest in sub-division, livestock and fertiliser.
“We want to get the best out of the pastures we have before looking at re-grassing.”
Fertility levels are close to optimum for their soil type, so they simply apply maintenance fertiliser and find DAP gives them the best return on their investment.
This is applied in autumn and as it contains nitrogen (N), it gives grass growth a boost and helps build feed covers going into winter.
There is no leaching as the soils are not wet at that time of the year and the growing grass makes full use of the N.
Between 50-60kg/ha of N is applied strategically over August and September, generally over the bull system but occasionally over the lamb blocks.
As they have become more environmentally aware, they have found farming with higher pasture cover benefits both stock and soil.
Bryce says occasionally a paddock will get away in spring, but they catch up with it as bulls will always eat it – even when it has lost a bit of quality – and they will still grow.
In spring they will often buy 200 yearling cattle – usually bulls but sometimes steers – as grass controllers. They are strictly a pasture management tool for the lambs.
“Preparing the lamb platform is the key and you can’t put a price on that, but we still try to make a margin on these trade animals.”
These trading animals are another safety valve in their system.
Bryce stresses the need to have flexibility in their business and this includes financial flexibility.
“You need to have financial flexibility for when Mother Nature throws a curve-ball at you and sure as eggs it will happen somewhere along the line.”
“In our system it’s about minimising damage and being proactive, not reactive – but to do that you need to have levers to pull.
“Every season is different, it’s always a challenge.”
Bryce admits it took a while to learn the skills of trading stock. He says it is important to read, read and read; read about the markets, the weather and what is happening with grass growth and market dynamics locally and nationally.
Bryce says it is necessary to take some risks with the wheeling and dealing – such as buying lambs when it is still dry to try and pre-empt rainfall – but he works on averages rather than top prices.
“You’ve got to learn to just go with it.”
Similarly, they are not afraid to sell bulls even when they have plenty of grass as often that’s when they can get the best prices.
“It’s all about the margins and building a cashflow that works as you go.”
Keeping in tune with environment
Farming in tune with their environment has benefited their bottom-line.
This has enabled them to invest even more in fencing off sensitive areas and undertaking an extensive planting and land protection programme.
“Number one, we’re in business and if we’re not profitable we can’t do anything, we can’t do any environmental enhancement work.”
They have recently cleared old poplar poles and willow trees as they were both a hazard and were shading pasture. These had done a good job at stabilising land and will be replaced.
Bryce says they are stepping back and looking to retire less productive areas all-together. They have fenced off and planted 6000 natives in a 1ha block around a creek that feeds directly into the Kaipara Harbour.
The couple says that this block is far more important as a filtering system than it is for grazing.
“Cattle used to bog it and lambs didn’t like that area anyway.”
The couple have tapped into funding and resources available to farmers in their area who are working to protect and enhance their environment.
They have planted 3000 native plants provided through a Habitat Trust and the regional council has also helped fund some of their fences.
“There’s lot of schemes out there to help.”
Bryce says many of the areas they are fencing off and planting were unproductive anyway and now these areas are more aesthetically pleasing, are attracting birdlife and in one creek, providing habitat for spawning whitebait.
The water above the spawning site is being tested by the regional council and anecdotally it’s very healthy, despite going through three or four other farms before flowing through the Lupton’s property.
All of those farms have fenced that stream off.
Bryce points out that whitebait is a good indicator of stream health but they are looking to enhance it even further.
The couple has been audited as part of a farm assurance programme and they are now involved in the development of the next, a more comprehensive standard.
The couple has been audited as part of their meat company’s New Zealand Farm Assurance Programme and they are now involved in the development of the next, more comprehensive standard, of this multi-stakeholder programme.
This gives them the ability to supply high-value contracts and leverage off their investment in the work they have done to protect and enhance their environment.
