| 11 Keeping your operation profitable For Simon the name of the game is diversification and spreading his risk. With 4,000 breeding ewes, 65 beef cows and wintering about 200 R1 dairy heifers, it’s a fairly large and busy operation. Randall Johnston FORESTRY » Simon Davies South Otago sheep farmer Simon Davies says forestry is the only thing that is keeping his operation financially viable in 2024. “We typically have about 9,000 stock units on about 1,000ha effective (which has been progressively dropping). 750 ha of that I own and 400-odd I lease,” Simon explains. With 4,000 breeding ewes, 65 beef cows and wintering about 200 R1 dairy heifers, it’s a fairly large and busy operation with little down time. This year Simon also has about 200 beef cattle. “They’re not as financially rewarding as dairy heifers but dairy heifers have been much harder to source this year, because sheep farmers have worked out it’s more profitable to be running them than sheep. The outlook for beef was much better than sheep six to nine months ago, and I think it’s going to pay dividends.” “I have previously put a contract and asked someone to rear some for me but this time I bought 100 reared and then another 100-odd mostly at autumn sales. The plan is to sell some in October and finish the remainder in autumn. All of the yearling stock are feeding on about 30ha of fodder beet at the moment and they do well on that.” For Simon the name of the game is diversification and spreading his risk, while trying to maintain some form of profitability. He encourages all sheep farmers in New Zealand to adopt a similar mindset – for their own wellbeing and that of their family. Simon began to question the financial viability of sheep farming and started the forestry venture on his property just east of Milton (near Balclutha) about five years ago and he hasn’t looked back since. “When we arrived about 15 years ago there were some trees on the property, so we excluded them all from the ETS at that point. However have since put all the tree areas we can into the ETS. We’ve been watching since then and the return from carbon credits if far more profitable than sheep or beef.” “The real progress started about five years ago, that’s when we took the less productive parts of the farm and started fencing off the ridges at the top and planting tress - so I didn’t need to worry about stock-exclusion of the waterway at the bottom.” So Simon’s first steps into forestry were more about addressing stock-exclusion issues and then it progressed from there. ‘Now, any area that I cannot drive a tractor on 03 425 9695 | 021 195 9920 info@ventureforestry.co.nz www.ventureforestry.co.nz Venture Forestry is proud to be supporting Simon Davies Experts in Emissions Trading Scheme • ETS Administration • Carbon Transactions • Carbon Portfolio Management • Permanent Forest • ETS Field Measurement is in or about to be in trees. We are about to put another 16ha of Pinus radiata in this year.” His main advice to farmers wanting to learn more about how to get into forestry is to speak to, and use the services of an experienced forestry consultant, because the ETS is complex legislation and the right steps, need to taken at the right time, and in the right order, to maximise the returns. This will also help avoid any potential pitfalls as the ETS has considerable technical detail. It really does help to have someone on your team who has the expertise and is aware of the various technicalities involved.
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