Property Express - $300 million livestock ‘game changer’
A PGG Wrightson initiative has put 1.2 million lambs and 200,000 cattle on farms throughout New Zealand over the past five years.
Described as an ‘enabler,’ a ‘game changer’ and a ‘no brainer,’ PGG Wrightson’s
GO-STOCK programme was introduced in 2015, placing over $300 million worth of stock with farmers, offering a straightforward way to manage cashflow.
Jamie Molloy, PGG Wrightson National Livestock Supply Chain Manager, says how farmers use GO-STOCK and what they can achieve with it is different in every case.
“PGG Wrightson buys the stock and retains ownership, meaning no initial cash outlay for farmers. Farmers then graze and grow the stock before deciding, in conjunction with us, when and where PGG Wrightson will sell them. PGG Wrightson pays any resulting positive trading margin to the farmer, less our fees and selling costs.
“GO-STOCK offers huge flexibility. Tallies vary from a few to thousands, with many farmers taking multiple contracts throughout the year.
“Its purpose is to remove the cashflow barriers that farmers traditionally face procuring stock. Whether they want to trade or finish livestock, this enables them to better use their capital for expenditure and expansion elsewhere, therefore maximising their farming assets and expertise as required to achieve business objectives,” he says.
Brett Te Whare manages the 2000 hectare Iwi owned Aramiro Station in Waikato. GO-STOCK has been crucial to allow use of capital to develop Aramiro.
“We decided to develop, taking what was an underperforming farm to the next level. Planning the development, which included water, fencing and infrastructure, we knew cashflow would be at a premium, and that it would be hard to wait on cattle sales for the cash we were going to need to develop the farm.
“We looked into GO-BEEF. Over the past year or so, we have had close to 350 animals on GO-BEEF, enabling us to free up capital and go ahead with the development. That has achieved what we wanted. Our short-term goal is to be self-sufficient. In the long-term we want to future proof our farm for the environment and for our people,” he says.
Meanwhile, Matt Thomas finishes beef and lambs on 230 hectares in South Wairarapa. He uses GO-STOCK to remove financial pressure from farm decisions.
“All the land we farm is leased, so we don’t have a huge amount of capital to underpin the operation, meaning GO-STOCK works beautifully.
“For beef, the bank balance can hold you back from making the farming decisions you need to make. Money going out at a crucial time can make life difficult. Because we didn’t have the operating capital to start with, GO-STOCK was a perfect fit.
“GO-STOCK can suit any level of farming. It’s purely a way to take financial pressure out of decision-making. For us, GO-STOCK was a no brainer,” he says.
Available for GO-LAMB and GO-BEEF, the initiative recently added GO-DEER.
Click here to find out more about GO-STOCK.
Read the full edition of the Autumn Property Express here.