Waianiwa Pastoral

November 2007
Waianiwa Pastoral is a recent large-scale dairy conversion in central Southland, organised by AGInvest, of Feilding, which forms farm syndicates of investors with an equity partner who farms the property.

Waianiwa is in its first season of milk production with 700 cows representing $1 million equity contributed by Steve and Vicki Henderson, previously sharemilkers at nearby Otautau.

The company agreed to purchase 213ha in two adjoining sheep, deer and cropping properties in mid 2006 for a total of $5.2 million and spent a further $3.5 million on conversion, after taking possession on April 1 this year.

Included in the expenditure was $1.5 million in Fonterra supply shares and the same amount on a 60-bale rotary cowshed, feed pad, third dwelling, farm races and underpass, silage bunker, fertiliser, subdivision and water supply.

Total cost of the converted property was equivalent to $30/kg MS production, which is about 25% lower than values elsewhere in New Zealand. The property is not subject to drought or flooding risks and contains quality soils and reliable water supplies. Total capital investment without stock was around $32,000/ha, of which 61% was equity and 39% debt. Previous sales in the region of established dairy farmers had been $24,000 to $32,000/ha.

Included in the purchase cost was a modern 90hp tractor with cab, two well-maintained residences and a full range of substantial sheds suitable for implement storage and calf rearing.

The recent drystock carrying capacity of the property was 2000 ewes, 500 hoggets, 245 MA deer hinds, 210 R2 hinds, 580 weaner deer plus 36ha of cereal cropping.

The property was noted in the past for the production of small seeds, including timothy and cocksfoot.

The farm was in 50 main paddocks fenced for deer and a very good central race. The farm was GPS mapped and a new farm layout created, with existing shelter belts incorporated. Water is supplied from bores at a depth of 6 metres and reticulated round a modern, high capacity system. All new paddocks needed stock water, with 9km of new pipes.

Soil tests showed Olsen P of 21 and 25, with a target for dairying of 30 to 35.

Capital fertiliser of 750kg/ha potassic super was spread over 125ha and a programme of pasture renovation incorporated into the farm calendar. Up to 39ha a year is to be regrassed by use of summer and winter crops and direct drilling.

Conversion to dairying required resource consents for water use and for effluent irrigation.

Access to the property was gained for development on December 1 under unconditional agreement to purchase, signed in November.

Waianiwa is established to be a high-producing dairy farm at 1300kg/ha MS and up to 450kg/cow. The feed budgets project production in excess of 1200kg/ha MS from year two. With inputs, new technology, new pasture and herd genetics, target performance is 1350kg/ha MS.

The company specialises in dairy conversions using investment money.

AGInvest is also behind the AGRIfund which is in the market now seeking $60 million from private and corporate investors to do more dairy conversions and to buy rural supply businesses.

For more information on AGInvest go to: