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Dairy firm has new approach

Wednesday, August 5, 2009

A major new player in the local dairy industry and strategies brought into the area from New Zealand were discussed at last week's meeting of the Monett Kiwanis Club. Tony Finch, general manager for Grasslands Consultants, described the efforts being made by his firm in southwest Missouri.

Speaking with a pronounced New Zealand accent, Finch told Kiwanians the company he represents and its stockholders have been seeking to expand operations in dairy production for a number of years. Due to the limited availability and escalating prices of land in New Zealand, a worldwide search was launched for new territory.

After looking at Australia, South America and England, representatives looked at the United States. From 13 states, the group settled on southwest Missouri. Over the past six years, Grasslands Consultants has purchased 11,500 acres of land in Newtonia, Wentworth, Avilla, Carthage, Lockwood and Aurora.

The office is in Monett at 218 E. Broadway.

"We very much believe the dairy industry will continue to be a big part of people's lives," Finch said. "We have a passion for milk."

While other states like Georgia offered a higher premium for milk, Missouri had inexpensive land, similar in many ways to New Zealand. The company has been able to buy land for $1,500 to $2,000 an acre. With the world population growing, Finch said land is a diminishing resource that can be put to use.

Missouri has an infrastructure for dairy production, even though the dairy industry here has been shrinking. Finch said over the last 15 to 25 years, cows have dropped from 1 million to around 100,000 today. Locally produced milk is sold to Dairy Farmers of America at its Monett plant.

The area has room for regrowth of the industry, Finch said. Grasslands Consultants hopes to expand its local herds to 10,000 cows by 2012. Shareholders have long term visions of milking as large as 100,000 cows throughout the States.

More than half the land the group has purchased remains out of production, left for future use. The company has also erected storage buildings that can hold around 450,000 bushels of feel either grown or purchased for use as needed.

Different strategies are being used by the New Zealanders. Finch said producers have largely inherited Holsteins but find their genetics not suited for pastoral based dairy farming. The company prefers to switch to mostly Jerseys or Jersey-crosses in the future.

Volume of production is not the biggest factor in the company's enterprise. Rather, the optimum value is for profit. Finch said the key to securing profit is switching the herd to eating primarily grass, or genetically developed herds that prefer grass.

A grass diet costs a third of what a grain diet costs or less, Finch said. At present cows are eating around 40-50 percent grass and the balance in silage or grain. Finch wants to boost the grass up to 65-75 percent.

One of the better known strategies of New Zealand dairying is concentrating on the quality of the forage. Finch said local herds are moved daily to different pastures where the grass is ready for consumption, giving each pasture a chance to rebound. There are hopes to train cows to eat pastures down to a low height to maximize what a grass field can deliver.

The cattle industry in southwest Missouri developed to a substantial level after the introduction of fescue, which endures through hot summers. Over time it was discovered natural fescue carries the endophyte fungus which has a detrimental effect on a cow's circulatory system.

Finch said his company prefers to phase out fescue entirely and switch to rye grass as the predominant feed. Another summer grass would also be introduced.

The New Zealand approach to dairying is seasonal. Cows go dry in winter when pastures are unavailable then start calving and producing milk in February and March. Southwest Missouri weather has colder winters and hotter summers than New Zealanders know, Finch said, offering challenges to overcome.

"What we do is very different," Finch said, "different but simple."

Using a pasture base in an industry almost entirely focused on confinement operations is only part of the difference. Finch said the approach also uses less expensive milking sheds as opposed to expensive traditional barns. The different strategies have made it more difficult to teach employees, especially those who have had a background in traditional dairy techniques.

Another feature that has made southwest Missouri attractive, Finch said, is the strong work ethic

"You have an abundance of hardworking reliable people. They're second to none, anywhere in the world," Finch said. Hispanic employees work especially hard, he said, but only comprise nine of the company's 60 employees. Cultural and language barriers make it difficult to explain the New Zealand approach, he said.

An employee can under the New Zealand approach, becomes a partner in the company. In time the worker gets to share ownership as well as profits. This too has been one of the keys to success and why participants have made dairying a way of life, Finch said. Success in the business will come from local people adopting the approach, Finch said, and profiting both for themselves and the company.

Coming from another country has also made it difficult for the New Zealanders to stay in the area very long. Finch said getting a work visa has been difficult. A number of different visas have been used, including arrangements with the University of Missouri in teaching different techniques.

There have been misunderstandings circulating about the company, Finch said. The price paid for milk, for example, is based on standards already established in the dairy business. There are premiums paid for butterfat content, low somatic cell counts and not having growth hormones coming from the cows. Often the company's milk earns these premiums, but it's a fair standard available to anyone, Finch said.

"The hard part of the business is to become part of the community," Finch said. "We're here for the good of the community, and for longevity."

Kiwanis President Lisa Balmas presided at the meeting. Frank Washburn was the program chairman.

In club news, Balmas announced there would be a board meeting at 7 a.m. on August 6 at the Sunrise Restaurant.

The Monett Kiwanis Club meets weekly at noon on Tuesdays for lunch and a program. Meetings are generally held at the Happy House restaurant.

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