SOUTH CANTERBURY VELVET ADVANCE PARTY REGIONAL WORKSHOP Held by - PowerPoint PPT Presentation

SOUTH CANTERBURY VELVET ADVANCE PARTY REGIONAL WORKSHOP Held by Sam and Annabelle Bray July 2019

Farm rm System Outli line ▪ 450ha Effective (50ha Hill) ▪ 6,400 Stock Units Wintered (14.2SU/ha) ▪ 475 Dairy Heifers (300 wintered as I/C R2) ▪ 60 Beef cows with all progeny finished prime ▪ 47 Winter Trade Beef Cattle ▪ 1300 Half Bred Lambs ▪ 330 Velveting Stags (6.2kg/head and $117 net) ▪ Growing 7,956kgDM/year over 450ha

Curr rrent Fin inancia ial SY Perf rformance Total Per Ha Per SU Net Farm Income $824,693 $1,832 $129 Farm Working Expenses $427,734 $950 $67 FWE:NFI 52% EBITRD $396,959 $882 $62

Curr rrent Net Farm rm In Income NET FARM INCOME Total % Beef $94,420 11% Dairy Support $417,168 51% Lamb Trading $119,050 14% Velvet $194,055 24% Total $827,073 Beef Dairy Support Lamb Trading Velvet

Curr rrent Dis istribution of f Costs Farm Working Costs Distribution % Beef 11% Dairy Support 57% Lamb Trading 13% Velvet 19% Beef Dairy Lambs Deer

Feed Dis istribution by y Enterp rprise Feed Distribution T/DM % Beef 588.9 16% Dairy Support 2,050.6 57% Lamb Trading 410.5 11% Velvet 493.5 15% Total 3,534.5 • Beef 11% Income and 16% of feed Beef Dairy Support Lamb Trading Velvet • Dairy Support 51% Income and 57% of feed • Lamb Trading 14% Income and 11% of feed • Velvet 24% Income and 15% of feed

Per r Hectare Return rn Net Income FWE Cash Cash Surplus Adjusted Surplus for Capital* Beef $1,269 $617 $651 $529 Dairy Support $1,630 $944 $686 $686 Lamb Trading $1,970 $1,091 $879 $802 Velvet $2,913 $1,237 $1,676 $1,304 *Value of Capital at 5%

Effect of f Velv lvet Pri rice Velvet Price $57 $77 $97 $117 $137 $157 $750 $52 $657 $1,262 $1,867 $2,472 $3,077 $1,000 -$135 $470 $1,074 $1,679 $2,284 $2,889 Purchase Price ($/head) $1,250 -$323 $282 $887 $1,492 $2,097 $2,702 $1,500 -$511 $94 $699 $1,304 $1,909 $2,514 $1,750 -$698 -$93 $512 $1,116 $1,721 $2,326 $2,000 -$886 -$281 $324 $929 $1,534 $2,139 $2,250 -$1,074 -$469 $136 $741 $1,346 $1,951 $2,500 -$1,261 -$656 -$51 $554 $1,158 $1,763

Deer r Expansio ion ▪ Repair 40ha at Glendonald – Expand Stags Numbers ▪ Airdeen • Ability to deer fence 140ha • All new fencing • New handling facilities ▪ Once Airdeen Complete • 500 Stags at Airdeen (3.6/ha) • 250 M/A Hinds plus replacements Glendonald (2.1/ha) • 85% of Stag taken through two years of age • 65% R3s retained as M/A Stags • Dairy Heifers dropped to 250

Capit ital l Development Budget Fencing 13.5km @ $15/m $202,500 Airdeen Handling Facilities $120,000 Stock Purchases: M/A Hinds 250 @ $1250/hd $312,500 Breeding Stags 8 @ $15,000/hd $120,000 R1 Hinds 110 @ $550/hd $60,500 R1 Stags 110 @ $650/hd $71,500 R2 Stags 95 @ $800/hd $76,000 R3 Stags 170 @ $1500/hd $255,000 Total Capital Cost $1,142,000

SY Net In Income Total % Net Income Dairy Support $218,211 23% Beef Income $94,420 10% Lamb Income $199,050 13% Velvet Income $390,006 42% Venison Income $122,752 13% Total $944,440 +$119,747 Net t Inc Income +$1 +$119,747

Change in in Costs ▪ Additional Animal Health Costs ▪ Change in Crop Requirements • Reduced from Dairy Support (-225 Heifers) • Increase +170 stags wintered • Allowance for all hinds and fawns for 100 days over winter • Plus summer rape for 60 days ▪ No change in other fixed costs

SY Farm rm Workin ing Expenses New System Previous Variance Stock Costs $38,111 $34,000 +$4,111 Land Costs $173,040 $172,500 +$540 Feed $49,887 $50,000 -$113 Fixed $171,234 $171,234 - Total $432,271 $427,734 +$4,537

Farm rm Cash Surp rplu lus New System Previous Variance Net Farm Income $944,440 $824,693 +$119,747 Farm Working Expenses $432,271 $427,734 +$4,537 Farm Cash Surplus $512,169 $396,959 +$115,210 Interest Costs @ 5% $57,100 - Farm Cash Surplus $455,069 $396,959 +$58,110 (after interest) • Increased Cash Surplus • Improved Farm Infrastructure (increase in land value) • Increase in asset by owning more stock • 14 Years to pay back debt (ave. cost of funds 5%) • 10% ROI

Per r Hectare Return rn Net Per Ha Cash Cash Surplus/ha Surplus/ha Adjusted for Capital* Beef $1,276 $658 $536 Dairy Support $1,618 $674 $674 Lamb Trading $2,307 $1,216 $1,139 Velvet (Previous) $2,913 $1,676 $1,304 Velvet (Breeding + Producing) $2,706 $1,658 $1,311 *Value of Capital at 5%

Effect of f Velv lvet and Venis ison Price ice on Farm Cash Surplus Velvet Price $58 $78 $98 $118 $138 $158 $7.11 $215,041 $286,101 $357,161 $428,221 $499,281 $570,341 $7.61 $221,753 $292,813 $363,873 $434,933 $505,993 $577,053 Venision Price $8.11 $228,465 $299,525 $370,585 $441,645 $512,705 $583,765 $8.61 $235,177 $306,237 $377,297 $448,357 $519,417 $590,477 $9.11 $241,889 $312,949 $384,009 $455,069 $526,129 $597,189 $9.61 $248,601 $319,661 $390,721 $461,781 $532,841 $603,901 $10.11 $255,313 $326,373 $397,433 $468,493 $539,553 $610,613 $10.61 $262,025 $333,085 $404,145 $475,205 $546,265 $617,325 Break Even Velv lvet Pric rice of f $102kg

Retention Rate vs Velv lvet Price ice Effect on cash surplus/ha (D (Deer) Velvet Price $58 $78 $98 $118 $138 $158 25% $17 $392 $767 $1,142 $1,517 $1,892 35% $61 $436 $811 $1,186 $1,561 $1,936 Stags Retained 45% $104 $479 $854 $1,229 $1,604 $1,979 55% $147 $522 $897 $1,272 $1,647 $2,022 65% $190 $565 $940 $1,315 $1,690 $2,065 75% $233 $608 $983 $1,358 $1,733 $2,108 85% $276 $651 $1,026 $1,401 $1,776 $2,151 95% $319 $694 $1,069 $1,444 $1,819 $2,194 • Target 75 Stags to be retained (15%) • For every stag over 75 can sell for $1500 • For every stag under 75 only sell for cull price and need to buy in another stag at $1500