Wednesday 28 September 2016

The model farmer who doesn't own a single acre

Noel McCall, the Zurich Farming Independent Farmer of the Year, tells our editor how he built up his dairy enterprise on leased land

Published 18/11/2015 | 02:30

Noel McCall on his leased farm in Co Wicklow. Picture: Garry O'Neill.
Noel McCall on his leased farm in Co Wicklow. Picture: Garry O'Neill.

One snippet of advice from the Wicklow farmer was for all young farmers looking for a way into agriculture without a family farm or land behind them was to be open-minded to all opportunities. Noel, who has built up his herd of 90 cows without owning a single acre, said new graduates should carefully consider all potential offers of leases or share farming carefully as they don't come along very often.

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"It has been a hard road but a worthwhile road. Eventually I got up to having my own herd of cows which is something I'd always dreamed of doing, my own farm but without owning an acre of land," Noel told those gathered at the Irish Farm Managers Association event on share farming.

After returning from New Zealand where he saw the potential of share milking system, Noel thought it would be a good way for a person from a non-farming background to get into farming. He placed an advert in the paper looking for a suitable farm and a man near his parents, Pat Heffernan, saw the advert and approached him

"We got talking and he was in his early 50s at the time with no successor," he said. Howver there were implications from tax and the milk quota at the time and he began relief milking for him.

A parcel of land came up for lease near the farm, and the farmer leased it out for Noel to take on and he got Friesian bull calves to rear while milking.

Noel told how he had saved €20,000 and it was this track record that helped him when he went to AIB bank looking for an unsecured loan. In 2005, Pat decided to apply for the early farm retirement scheme and Noel was given the chance to lease the whole farm. "I went into the bank and had a chat with them and bought milk quota through the restricting scheme. I bought 60,000 gallons the first year starting out with 45 cows and I also had the beef enterprise over on the outfarm."

He built a 120ft long shed on the farm, carrying out all the work with the help of his brother who is involved in the steel industry, for the princely sum of €25,000 over the slatted tank that Pat had installed.

However, he is operating off 'modest' infrastructure including an eight unit milking parlour and houses stock for just two months to keep the need for sheds down. Noel told how both himself and his wife Louise built their house, where they now raise three children Josh (7), Kimmy (4) and Lauren (2), and they had to ensure that the leased farm met all of their financial outgoings.

"I never had land in the first place to know the security of it," he said. "The farm had to stack up as a business."

Then in 2009, the milk price dip hit the dairy industry. "I suppose I felt the full exposure of the milk price on the leased farm with reasonably high borrowings," he says. "Then in 2010 there was the superlevys and I had too many cows and couldn't afford to get a superlevy bill. I had to take the decision then to offload some cows and maybe go back down to just 80 cows" he says, with 25 late calving cows to the mart the following April after the price dip."We still maintained the thing and the price of milk started coming back up." He told how he had to go back to the bank and restructure the loan to get over the price dip, but he feels 3-4c/l is enough debt to carry.

"I recently signed a 12 year lease that will take me into 2027. It is great security again and for the farm owner he has the added incentive of the extra money he can claim with the lease," he said.

After the low milk prices late this year, Noel thinks it will take another six months for the impact to kick in. "I think it is going to hit next spring," he said, adding he might have to take the "hit" and sell some cows that aren't performing as well for cash with 105 to calve next spring. "There are sometimes that you have to take a step backwards to go forwards and don't be afraid to do it. A clear vision of where you are at is important." Louise said the low milk price does impact on relationships and morale.

Now, they are planning to move up to 120 cows. "The plan was to go 10 a year for the next three years, but if it takes four years or if it takes five years. Ten cows would release you maybe €12,000 or €13,000 that could get you through those lean months, you do what you have to do. I don't want to be at a tipping point. I always want to make sure what I own is worth a lot more than what I owe. At least if you had to liquidate everything you are covering your debts."

Both Noel and Louise said any newcomers following his route need to be both "brave" and willing to compromise.

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