Making plans
19 August 2016
Western Riverina cattle producers Jim and Jane Ives credit the MLA/Australian Wool Innovation Pastoral Profit program with challenging them to move their business towards future sustainability.
The Ives run 500 Angus breeders on 10,000ha south-east of Hay, NSW. They have spent the past decade developing a holistic rotational grazing system and now graze cattle on perennial native pastures at a stocking rate of 1 DSE/ha.
Depending on the season, they either send stock at 500–650kg live weight through JBS’s grassfed assured program or at 450–500kg to feedlots.
Jim said one of the biggest challenges facing producers in the pastoral zone has been the run of dry years. Hay has an annual rainfall of 350mm, but the Ives have received less than 315mm/year for the past 22 years. During the dry years the family relies on droving cattle and agistment, spread from south-west Queensland to southern Victoria, to maintain productivity.
After receiving 125mm since the end of April, their enterprise is on-track from a productivity perspective, so Jim and Jane have turned their attention to the sustainability of their business with their three daughters in mind. Emily and Lillian are in years 11 and 9, while Grace is studying agribusiness at Marcus Oldham College.
“Our business goals are to remain sustainable from a production point of view, but to also set up our business for the next generation,” Jim said.
“The girls have all been very involved in livestock management but they are starting to take an interest in the financial side of the business.
“We encourage our daughters to study and work off-farm to gain new experiences – which could be brought into the business – but we want structures in place so they can come back into the business if they want to.”
Inspired by past experience with MLA business webinars, the Ives and a few local families got together and formed a Pastoral Profit group, with assistance from Dubbo-based Pastoral Profit NSW coordinator Mark Gardner.
The group, which involves nine families, has met four times so far.
“Pastoral Profit has really motivated us to streamline and improve our business, especially from a financial perspective,” Jim said.
“It has also given us access to information and advice, which can be challenging for us to find because of poor internet service.”
Practice change
They have already made changes to their business as a result of Pastoral Profit, which include:
- A full review of their business structure to improve farm succession planning.
- Meeting with their accountant more regularly to conduct business planning, not just taxation planning.
- Introducing them to the concept of business benchmarking (the NSW Pastoral Profit program is also seeking to establish a benchmarking component).
- Involving their children in discussions about business and succession planning. Grace attended one of the Pastoral Profit sessions.
- Using tools from Pastoral Profit to examine options to assess the risk of various expansion options, such as buying land in a different climatic zone or using irrigation country that is currently owned.
Jim and Jane’s lessons learned:
- Plan, plan and keep planning – especially for the big things like capital expenditure and succession planning.
- Involve all family members in decision making.
- Involve advisers, such as financial planners, accountants and solicitors, in regular business planning.
Want to get involved with Pastoral Profit?
Contact a Pastoral Profit coordinator:
National: Natasha Searle T: 02 6884 5334, E: pastoralprofit@ruraldirections.com
NSW: Mark Gardner T: 0419 611 302, E: mark.gardner@vbs.net.au
SA: Anne Collins T: 0427 486 115, E: anne.collins@sa.gov.au
WA: John Duff T: 0417 183 330, E: john@agvivo.com.au
Queensland: Heather Smith T: 0428 712 985, E: pastoralprofitqld@gmail.com
