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Diversifying to ensure a robust future

Words by Annie Studholme

6 November 2017

While New Zealand’s burgeoning tourist market presents opportunities for Mackenzie basin farmers to explore new income streams, for Hamish and Julia Mackenzie of Braemar Station, they are farmers first, and always will be.

With its spectacular uninterrupted views of Aoraki Mt Cook, it’s no surprise Braemar Station has become a Mecca for tourists. Today, tourists flock to the 4,092ha high country property located on the southern shores of Lake Pukaki year-round to frequent the local ski fields, enjoy other local activities, cycle the world-famous Alps to Ocean Cycle Trail linking the Southern Alps to the Pacific Ocean or just soak up the views.

But while tourism now provides a large chunk of the Mackenzie’s annual income, both Hamish and Julia remain committed to farming this unique piece of the world, and all the challenges that come with it.

Duncan and Carol Mackenzie, Hamish’s parents, first purchased Braemar Station off the Australia New Zealand Land Company in 1969. Back then it was a sheep and cattle run, split into seven blocks and with no real fertiliser history, explains Hamish.

During the mid-1970s the upper Waitaki power development saw Braemar Station lose 1,000 acres as Lake Pukaki’s levels were raised higher. “We lost all the lucerne and hay paddocks, and also used to run 500 cows up in the river bed but when the lake came up that dropped to 150.”

Back then the farm’s main income came through Merino wool. Although the station was highly regarded as having one of the country’s leading commercial flocks, it was a hard graft, says Hamish. “They were basically going broke because of footrot. There was no time to do any development or repairs and maintenance, as every moment was spent turning over sheep. There was also no production because of the footrot; it was a bad thing to be known as a footrot place.”

In 1997 Duncan turned his back on farming Merinos, switching breeds to Perendales, which had a reputation for being hardier.

Hamish returned home in 2000 after gaining vital experience working on farms in North Canterbury and Omarama, as well time spent travelling working in the US and two years on farms in Australia. The same year he and Julia were married.

Brought up in the Rakaia Gorge, Julia (nee Todhunter) has a Bachelor of Agricultural Science degree from Lincoln University and had previously worked for AgResearch at Tara Hills, then at South Pacific Sera at Blue Cliffs Station for William and John Rolleston. After they were married she worked off-farm for WoolPro, which was the precursor to Beef + Lamb New Zealand, until children came along.

Initially Hamish and Julia worked as a married couple, assuming more management roles over time, with Duncan and Carol moving off the farm in 2007. “We were very lucky. Duncan stepped back pretty quickly and willingly gave us the reins,” says Julia.

By 2014 they owned the farm outright, and had also completed Tenure Review, which saw the total farm area reduced from 17,500ha, of which 2,500ha was already freehold, to 4,091ha. In the handover 6,450ha was designated as public conservation land, while 6,990ha went to the Defence Force that operates the nearby Balmoral military base. The remaining 1,700ha was freeholded.

“It was a long-drawn out process, taking almost nine years to complete. It sounds like a massive loss, but in reality we didn’t loose any stock units,” says Hamish. “The important thing was that we already had 2,500ha freehold and we gained another 1,700ha.”

Since taking over, Hamish and Julia have focused on increasing productivity, undertaking massive regrassing and development, which they are starting to reap the benefits of now.

Of the total 4,091ha, 2,341ha is developed into paddocks and blocks. Sitting at 630m above sea level on the eastern side of Lake Pukaki, it’s climate is one of extremes with dry summers and long, cold (150 days) winters with temperatures plummeting to -15 degrees. Average rainfall is about 875mm, with snowfalls “pretty reliable”. This winter they had snow around the homestead for five weeks.

The key is being able to farm to what Mother Nature throws at you, says Hamish. “The climate is our big limiting factor. You have to farm to it so we have room to move, being able to get rid of stock if it gets dry in the summer. It’s a short growing season. Luckily, we have a very reliable spring because we are in the norwest rain shadow, but the summer can be dry right through. In the odd year when you get a good season right through, everything works.”

Today, Braemar Station runs a 4,700 Perendale breeding ewe flock lambing at between 115-125% with all lambs fattened on-farm (weather permitting), about 340 predominantly Angus breeding cows with the progeny sold at weaning, and 750 hinds, alongside the tourism accommodation.

They have put a lot of time and effort into the sheep over the years improving the flock, developing strong markets for their hoggets. “We keep 2,000 hoggets to fatten through the first winter (on winter feed) then drop to 1,300 with 700 sold as replacements. We have a good market for those replacements and the market for them seems to be relatively stable,” says Hamish.

But while their wool was fetching $7.50 per kilo clean two years ago, this year’s prices have fallen dramatically. “We usually get a premium for our wool because its full length and nice and white, but a premium on $2.50 is only going to be $2.60 this year which will barely cover costs,” says Julia. “There is just a huge difference between a good year and bad one (with sheep). We have put a lot in to the sheep but feel like we’ve hit a wall, whereas all our effort seems to be being rewarded with the deer. It really feels like we are achieving something. No-one likes to go to work everyday and not see results.”

In the past five years the Mackenzie’s have focused on developing the deer operation, increasing deer numbers by 400. Their deer block, which has a small proportion of developed paddocks, is 485ha of what they describe as some of Braemar's tougher country. There had been wild deer on the block, which led Hamish’s father to set up the deer farm in the early 1980s.

“The deer work quite well in the high country because their later fawning means that they match feed supply with the later spring. The rest of the time we are trying to manipulate what feed demands we have to make some money out of it,” says Hamish.

Originally, they used to sell all their deer at weaning, but with improvements to their breeding programme, and looking at ways to grow weaners to better weights - simply and at least cost - finishing them has become a viable option. Now the Mackenzie’s keep all the weaner hinds, only selling the stags.

The market too had gone through a resurgence, which Hamish believes is largely because of the Passion2Profit (P2P) deer industry initiative which was launched in 2014. A joint venture between the New Zealand deer industry and the Ministry for Primary Industries (MPI) under the Primary Growth Partnership (PGP), the seven-year $16 million initiative spans the venison value chain, from farmer to consumer. It involves substantial projects on both farming and marketing sides.

On the marketing side, the programme has been centered on extending the use of Cervena with the five biggest venison marketing companies joining forces to create a marketing programme outside of the US and Australasia looking at smaller markets like China and Europe. While on the farming side they have set up Advance Parties bringing together motivated deer farmers to work together to identify to improve profits on their deer farms.

The Mackenzie’s are part of the Mackenzie Advance Party working group with Hamish being group chairman. It is one of 26 such groups nationwide with Deer Industry NZ (DINZ) aiming to have 30 operating by the end of the year.

While venison production is still down from the highs of 2008-2013 when 15,000 tonnes were produced, DINZ expects it will reach 12,000-14,000 this year. Venison schedule prices are also up 17 per cent on last year reaching more than $9/kg on the back of continuing strong demand in the North American market.

Earlier this year marketing also started in Germany, and excitingly a new market has been developed in Sweden.

“You have to remember that only four years ago the deer market was in a pretty bad way. While it’s still early days, they’ve stuck to their word and it’s looking positive for the future. I think the way they have done it gives more backbone to the market going forward,” says Hamish.

Prices are one thing, but Hamish has also grown very fond of the deer. “There is a lot less work involved and you work them totally differently to anything else. I do really enjoy working with them. In time, we might look to reduce the sheep numbers further to increase the deer herd.”

Tourism is another area where the Mackenzie’s can see future growth. Originally started in a “low key” way by Hamish’s mother, Carol, in the 1990s, Julia started pushing the on-farm accommodation when the children were little as the change from married couples to single boys freed up some of the staff houses. “I needed a job that wasn’t off-farm and gave me flexibility,” she says.

Initially they started with just the Shearer’s Lodge and Pine Cottage. Then in 2007 they converted the Hilltop Cottage and in February last year added the purpose-built Station Cottage, which takes them to 40 beds in total. The cottages are fully self-contained, with clients coming from all over the world, as well Kiwis. All linen is provided and Julia also offers cyclists a dinner, bed and breakfast option as well as packed lunches.

While many of their clients are cyclists on the Alps to Ocean Cycle Trail which opened four years ago, Julia says without them, they would probably still be full. “We work really hard to make sure we don’t rely entirely on one market. About 35 per cent of our clients over the year would be cyclists. We are pretty much full from September through to May, and cyclists make up 80 per cent of the bookings in February, March and April.”

One thing the Mackenzie’s love about the cycle trail is that it gives people an opportunity to see the real Mackenzie country. “We do like having the cyclists as most of them are Kiwis and Australians and it’s great to get them off the main drag and appreciating that there is more to the Mackenzie country than what they see from the main road,” says Julia.

But while they can see the potential for future opportunities on the back of New Zealand’s massive tourism growth, it takes time, effort and capital. “It is certainly not the easiest money we earn on the farm! It takes a lot of work and financial input. Over the years we have slowly been chipping away at it, extensively renovating all the cottages, but it all costs.”

Now that they are almost at capacity, Julia has someone to help with cleaning and meals during the busy months. She splits looking after the accommodation with her other farm duties, chasing Gus (14) and Kate (12) who are both at boarding school in Timaru, and her other commitments.

Julia is also on the Mackenzie Country Trust that’s goals are to achieve long lasting protection for the outstanding Mackenzie landscapes and natural values alongside a sustainable local community. It is one of the greatest challenges facing the whole region, and one she is very passionate about.

As farmers, Julia says it’s getting increasingly difficult to farm with the limitations being placed on them.

The whole property can be seen from the main road to Mt Cook and is considered an “outstanding natural landscape” in the District Plan.

“Almost anything we do now requires a resource consent,” she says. “We have gone from being a not overly regulated district to one of the most regulated in the country which will take some getting used.”

It’s simply getting harder and harder to farm in a place like this, and that’s unlikely to change, but our passion has not diminished, says Hamish.

Going forward, they hope to make the business more robust so that if, and when, their children are old enough to take over, there is something to come back to.