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By: Richard Bentley
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Source: Rural News Management - 23 October 2007
Never mind production, check out the profit.
Ask Bruce McGill what he does for a living and he probably won't say that he runs an organic sheep and beef farm. Instead he will describe the enterprise as "a specialist production system for creating high quality healthy organic foods for niche markets at a profit."
For Bruce and his wife the business partner Denise the difference is important - they believe healthy soils and pastures mean healthy livestock that create healthy foods for people and a sustainably healthy bottom line for their business.
When they took over the family property near Owaka on the Catlins Coast in 1980, the McGills were unhappy with conventional farming methods. Bruce's father had just died from cancer and they wondered if the farm environment had contributed to his illness. They could see the system was not sustainable environmentally or financially.
"We had no equity and little income so we challenged every bit of expenditure, eliminating drenching and vaccinations and quickly becoming a low-cost operation," says Bruce.
"We were still production-driven and using super-phosphate - in fact we won a production award one year - but we were interested in organic systems and we could see that upmarket consumers wanted products grown without chemicals in a clean environment."
The conversion to organics took more than a decade, partly because Bruce wanted to continue strategic drenching and also because there was no premium then for organic meats. However, the slow pace of change worked in their favour - they were able to breed worm resistant stock that thrived under the new regime.
"If you stop drenching and remove the artificial chemistry props there will be winners and losers among your stock. We have been selecting both males and females for the last 15 years and we have ended up with much better performers," says Bruce.
"Resisting worm infection takes quite a lot of energy for the animal and many resistant animals do not have high production, but there are always a few that do and we've found a breeder who supplies high productive and resistant rams."
Conventional farmers wanting to take advantage of today's higher payments for organic lamb may come to grief if they try to force the timeframe for conversion, says Bruce.
Changing soils and genetics away from dependence on artificial fertilisers and drenches can take more than one sheep generation.
The 660ha hill country property (500ha effective, 100ha in QEII Trust) consists of stony ridges, rolling hills and some sandy river flats. Both the original farm and a later purchase were run-down, and although the McGill's used super phosphate for some years their decision to go organic meant a change to RPR, lime, elemental sulphur, cobalt, selenium and other trace nutrients.
They also spent money on compost teas, fish fertilisers and the like to put "biology" into the soil.
"Stock needs some trace elements that soils and pastures don't, and it is far more cost-effective to use mineral blocks so that livestock get them direct," he says.
"We budget around $10 per stock unit for fertiliser, but what we put on varies from area to area."
This season the McGills are running 2500 breeding ewes and 700 hoggets - Perendales crossed with Texels to maintain hybrid vigour. Lambing starts around mid-September yielding 130-140% survival to slaughter at 15-16kg. Last season's schedule was $6/kg.
"We sell the excess females as in-calf breeding heifers, and sell the steers as weaners privately to organic farmers for finishing. Calving starts September 1," says Bruce.
"We're now running 170 breeding cows and 70 other cattle, making a 60:40 ratio of breeding ewes to breeding cows. This fits our farm and mission statement best in matching stock demand closely to pasture growth - I'm not interested in spending summer making supplements and winter feeding them out."
The mission statement along with short and medium-term goals have given clear directions to the McGill's business. Members of eCOGENT.biz since 2002, the McGills have found the process challenging but they are now reaping the rewards - profits of 6-9c/kgDM consumed, says Bruce, a figure similar to many dairy farmers.
Living in the Catlins adds possibilities of tourism to the business, and already their daughter Cara is offering horse-riding treks to visitors who want to learn more about the area at first hand. Farm-stays are also in their action plan.
"I like the tourist activities, taking people around our property and talking about organics to them," says Denise. Bruce agrees.
"Our ultimate goal is healthy soils, healthy stock producing healthy food, and I think if only a few people eat our healthy food and we leave the place in a sustainable state then we will have achieved something worthwhile.