WA family dairy business grows rapidly

17 Jul, 2017 10:05 AM
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The main farm enterprise is growing grass.

In 1968 the Lammie family migrated to Western Australia from Scotland and bought a half-cleared dairy property at Northcliffe running a 70-cow herd.

Robin Lammie joined his parents, Christine and Robert, on the farm when he turned 18 and remained until the family sold up in 1994. He then took a change of direction and bought Bunbury Freight Company, which he ran for 18 years, selling in 2014.

"I'm a big picture person," he said, "We had some 600 customers and I got used to dealing with lots of people."

Robin's son Wes was always keen to farm and after completing Year 10 persuaded his father to let him attend agricultural college.

"Dad said it would be an expensive two-year holiday," Wes said. "Farming provided me with roles and responsibility at a younger age and I enjoy the variety of activities on a farm. There are also other lifestyle advantages."

After leaving college, he ran the Perth end of Bunbury Freight for his father. Being very tall and a footy player he was in demand as a ruckman and spent his weekends playing.

"I learnt the importance of teamwork in sport, but I had always wanted to farm and realised I could drive a tractor when I was 35, but not kick a ball," he said.

So the Lammie family formed Stockdale Pastoral company and leased a former dairy farm at Boyanup, originally intending to grow beef but they decided to renovate the old dairy and go for milk production. By November 2013 they were milking 105 cows.

In March the following year Parmalat, the French owners of Harvey Fresh, held a producer's meeting and offered an incentive contract based on milk volume and quality.

Robin and Wes decided to sign up and set themselves a target of doubling their cow numbers by March 2015. By September 2014 they had leased additional land for silage and reached 280 cows. They continued to purchase or lease more cows throughout 2015, and in April 2016 they took a 5+5 year lease on their present 400ha farm at Busselton and moved there with 480 cows. They are now milking 630 cows and have leased additional land.

Robin said in 2014 they produced 2.59 million litres of milk, increasing after their first summer to close to 4 million litres.

"We reinvested in cows to obtain a better cost structure. Milk quality also became our number one priority," he said.

Betty Lammie and Sarah Kenny

Robin's wife Betty keeps the books and manages the back office. She is training Sarah, who is soon to be married to Wes, to take over.

Sarah has no rural background. She is as a dental nurse working at Bunbury.

"Now I've got one child and 600 cows to look after," Sarah said. "Wes was prepared for me to continue my career but I wanted to be hands on and spend time together on the farm."

Sarah gets paid a wage for her work. Both Betty and Sarah say a wage is important for farm women and should include superannuation and workers' compensation.

Betty does not receive a cash wage. Her horses generate a negative cash flow and are maintained by the farm in lieu of wages.

Sarah said it was is important to achieve a work:life balance and to keep the bigger picture in mind. The low point for her came when Wes was sick one week after the family started at Busselton. "Being part of the family helps us grow," she said.

Betty said: "Sarah made it easy. She never took anything that was said the wrong way.

"The glue that keeps the business together is committing, being open and accepting that there are differences in goals. We don't always get things right, resulting in ranting and raving at family meetings, but we've achieved a lot in short time."

Business performance

The farm's business performance was discussed at the day in workshop with Robin Lammie facilitated by Kirk Reynolds.

The Lammie business has been run through the Dairybase program to benchmark its performance, now they have clocked up 12 months on the Busselton farm.

The Busselton property consists of 300ha grass for milkers and 100ha for silage. The growing stock are kept on the original property at Boyanup and a new 100ha block, originally part of the same farm, leased nearby.

The soils are all duplex sands and the Lammies were excited to be able to grow feed for 630 cows at 2.1 milking cows/ha and 1.6 cows/usable ha.

In the business, Robin is the salesman and numbers man. Betty is in charge of finance and back office and Wes runs the overall operation and manages staff.

Robin has two other sons, both tradesmen, and a daughter, a physiotherapist, all of whom are called in to help out when needed.

Total labour employed, including family, comes to one full-time equivalent (FTE) person to every 105 cows. Robin calculates it as 59,746 kilograms of milk solids per FTE.

The main farm enterprise is growing grass. They use a contractor to make silage and buy in more feed as the herd size increases.

"Milking is our main aim," Robin said. "We are not into breeding programs. We use mainly crossbreeds. Holsteins produce a lot of milk but eat their heads off.

"We aim to run lots of cows. Good grass feeding wins, and we raise our own young stock. We have all year-round calving but we aim to concentrate on October to December. When buying in stock, we are prepared to pay a premium for that."

Annual production is now five million litres of milk, 8000 litres/cow or 16,750 litres/ha. Average composition is 3.8 per cent fat and 3.4 per cent protein. "Cash flow is king," Robin said.

Lammie feedbase system

Dean Maughan led Wes Lammie through a discussion that explored their approach to optimal feeding systems. The conversation included an exploration of their approach to pasture utilisation, silage, feed testing, pellets and the cost:benefit of their system.

This philosophy ensures they have the ability to manage feed costs through a focus on margins, so that the system is robust to milk price.

Both Robin and Wes Lammie are responsible for feeding the herd. They believe in the KISS (keep it simple) approach to feeding and managing the herd. Their prime aim is to grow lots of grass and produce lots of milk.

"The key point is that we aim for good quality feed cow to maximise health and reproduction potential," Wes said. "It costs an extra 1.7 cents a litre but results in the cows being in better condition."

The Lammies set up a development budget for pasture renovation on arrival at the property.

"When early rain came we sprayed summer weeds over 200ha and began an aggressive seeding program based on Wimmera ryegrass mix at 35kg/ha and clover in some areas," Wes said.

In 2017 they will be completely reseeding a percentage of the farm and 'topping up' others as they realise the benefits of reseeding.

"The grass was a blank canvas when we arrived," Wes said. "So we carried out extensive soil tests. Soil pH was low, so we applied 5 tonnes/ha lime over 270ha. Soil test P (phosphorus) and K (potassium) was mostly not too bad with P low and K about average. We followed by 5:1 (P:K) at 300kg/ha.

"Our aim was to get the lime out quickly and limit the cost of contract spreading by doing it in one hit."

Jono Trigwell, the contractor, was equipped for GPS mapping of paddocks allowing different amounts of fertiliser to be applied on different areas.

"You could see as benefit as it was grazed," Wes said. "The cost of $35,000-$40,000 was a no brainer.

"We spent $100k on improving farm fences and installing laneways. We spent 50 per cent more than our budget because it was a wet year. There was lots of grass and that paid off in growth rates."

With a high stocking rate, the system is driven by nitrogen during the growing season. It is applied about every 30 days. Paddocks are grazed on the basis of ryegrass leaf stage and biomass present and the rotation is set accordingly.

"We graze 60 heifers and 110 dry cows 2-3 days behind the dairy cows," Wes said. "The best grass goes to the milkers, which are rotated on pasture in a 36-day cycle in winter.

"Moving stock every day ensures good management as we are looking at them every day and also keeping an eye on the grass.

"Dry cows get an 8-10-week break before calving. When we stopped feeding pellets we lost some with milk fever. Now feeding pellets before calving is a given."

When they first moved to Busselton they bought standing crops for silage. The result was mixed quality.

"Now we take control of our home-grown feed and get the full benefit," Wes said. "We try for best quality and quantity.

"Robin is keen to measure silage dry matter so we test every day. Improved quality to 18.55 per cent crude protein resulted in a great response from the cows."

They use a feed-testing service to ensure a balanced ration with crushed wheat mixed in with the silage fed in the paddock.

Wes says observations of the herd are important in assessing whether the feed is meeting the cows' requirements. For example, if the cows are hungry they will run out to meet the mixer.

Most of the cows are 50:50 crossbreeds giving up to 32 litres/cow on 11kg pellets and 2-4kg crushed wheat daily added to silage fed in the paddock.

The annual consumption per cow is 1.6 tonne grazing (27 per tonnes), 1.1 tonnes fodder and 2.9 tonnes of concentrates.

The Lammies feed Milne Feed's Maximise pellets in the dairy. They have tried other brands, but had trouble getting cows to eat some of them.

Wes said they bought in pellets to minimise the capital invested in plant.

"It pays to order pellets," he said. "Milnes Maximise are not dusty and the cows respond well. Consistency is important too.

"Pellets cost 6-7 cents/litre of milk at 45 cents/kg. Pellets pay if we get one extra litre of milk."

Every day or so Robin checks the milk level in the tank and using the base monthly milk price (that is, ignoring incentive payments), he calculates the return they are getting over and above feed costs.

They are not afraid to increase the pellets or to add 2kg of crushed wheat to the feed mixer if the return over the base milk price is reflected by what is in the tank.

Asked how they could we adapt to a lower a milk price, Wes said high input was still the best option plus maximum use of high-quality home-grown feed.

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