Dairy farming is the best way to progress to land ownership in the primary sector “by a long shot” but it takes longer than it once did, Federated Farmers share farmer chairman Marcus Frost says. “You've just got to figure out what you can do, how much work you want to put in, how much you want it and then go for it.” The South Otago dairy farmer believes opportunities remain in the dairy sector but there were fewer of them due to the corporatisation of the dairy sector. “The door to farm ownership is closing a wee bit.” Although a rise in corporate ownership of dairy farms provides more opportunities for being a farm manager, he said. Anyone wanting to progress to farm ownership would find a way with the help from the right people. “If people really want it, they will seek those opportunities and try and find those right mentors.” Securing a loan with a bank could be challenging without the backing of a family member or a farm owner. Keen farmers wanting to progress would find other ways to buy cows or enter an equity partnership. “If you want something bad enough, you'll find a different way to skin the cat.” He believed there were opportunities, it was a matter of finding them. “They are out there, they’re just hard to find.” For people to progress in the industry, opportunities needed to be made available, such as farm owners willing to sign 50:50 agreements. In a 50:50 agreement, a sharemilker owns the herd and equipment and operates the farm. Then in return for running the day-to-day business and supplying the cattle, they get half of the milk income. The landowner provides the land, buildings and major infrastructure. Mr Frost said there were fewer 50:50 opportunities available now than there were five years ago, he said. “That stepping stone is slowly disappearing.” SHAWN MCAVINUELowerorder sharemilkers Marcus Frost and Jemima Aratema feed calves in Crichton in 2024. Photo: Shawn McAvinue The 31-year-old and his wife Jemima Aratema, 29, were in their second season lower order sharemilking a herd of 630 cows on 280ha in Clydevale. Before Clydevale, they were contract milking in Cricton near Milton. The pair want to progress quickly in the sector. “We're doing all this hard yakka while we're young, instead of just coasting along.” In their first season, they exceeded their production target, each cow producing 425kg of milksolids. As lower order sharemilkers, they manage the day-to-day operations in exchange for a percentage of the milk revenue. They do not own any of the cows they milk. “When we come here we're looking at buying some stock, but the prices just went through the roof and it was financially unviable to buy cows and probably will be for the foreseeable future.” Cow prices would need to drop before they considered buying any, he said. “The bank's not lending to new sharemilkers at the current price so that hamstrings a lot of people.” They want to go 50:50 sharemilking but they were investing money elsewhere to build equity, rather than buying cows. He believed there were better ways to invest money now than buying cows, he said. “They're only going to go one way and it's probably down.” Dairy farming could be a “hard gig”, he said. “It is a hard grind, it's hard work and there's always a sacrifice and quite often it is isolating. It's not for everyone but the people who do like it, will progress.” SHAWN MCAVINUEFederated Farmers Otago sharefarmer chair Marcus Frost, of Clydevale. Photo: Shawn McAvinue
