Grazing prices in franklin?

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7 years 9 months ago #38449 by O BRIEN
Hi all , just after some advise re grazing prices. We recently purchased 60acre in franklin which is being grazed by the neighbouring dairy farmer, he looks after the stock completely and has been on there for sometime. He has been paying a monthly fee for the block and can run as many animals as he likes. My question is what is the going rate?
Cheers

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7 years 9 months ago #495666 by LongRidge
The only real answer is ..... whatever you can get.
With the milk price at $5.30 per kg next year, this is below the cost of production. Thus based on that he will not be able to pay you anything.
If he is fertilising and doing some weed control, then that will be less than if you are doing these.
If you are invoicing him and putting the income through your books, then that is a cost that he can claim, so you can charge about 20% more than if the transaction is under the table.
What is the fertility like, and the drainage? If he can run more stock per acre then the value is higher.
About $100 per acre per year plus GST if you are registered is about a reasonable rate.

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7 years 9 months ago #495667 by O BRIEN
Replied by O BRIEN on topic Grazing prices in franklin?
Thanks LR , food for thought and maybe more profitable to put some of our own beefies on.
I looked at another block before buying this one which was part of an existing dairy farm and they where keen to lease it back 25k per annum 50acers . As you say I guess its dependant on milk prices.
This block is fertile with good drainage and low lying so tends to be greener than others mid summer.
Just thinking forward as we are currently overseas but moving back to NZ at the end of the year and wanting to know what was going to be the most profitable use for the land..
Cheers

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7 years 9 months ago #495678 by EV
Replied by EV on topic Grazing prices in franklin?

LongRidge;500909 wrote: About $100 per acre per year plus GST if you are registered is about a reasonable rate.

O BRIEN;500910 wrote: they where keen to lease it back 25k per annum 50acers .

This is a huge difference in prices! $100/acre/years vs $500/acre/year. There must be more to it than just milk prices? I guess bigger blocks would be worth more? Better grass? More demand? All of the above? Wow.

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7 years 9 months ago #495683 by O BRIEN
Replied by O BRIEN on topic Grazing prices in franklin?
Yes a huge difference.
Not really in touch with what dairy farmers are paying at the moment. It seems most are paying per head instead of leasing the land ?

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7 years 9 months ago #495706 by max2
Replied by max2 on topic Grazing prices in franklin?
And equally there are a lot of dairy farmers who are supposed to be paying but are not.... its only going to get worse.

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7 years 9 months ago #495727 by katieb
Replied by katieb on topic Grazing prices in franklin?
If they are paying per head it is for grazing where the land owner looks after the stock. Per ha is how its usually charged if the stock owner is looking after the stock. It is in their best interest to keep the fert going in to grow grass but some people dont. You should have a written agreement with them

My parents lease 14 Ha for maize, they got it about 12 months ago, in that time they have grown a crop of maize then they planted ryegrass, which has been grazed 3 times(i think) by young stock, it has been sprayed out again & will be planted in maize once the weather cooperates. The land is right beside part of the farm we live on so easy to access for moving stock there although they have to walk the stock at least 3kms of races to get from the main drystock part to the maize ground(only about 1.5kms down the road from main driveway to check them though) & once thats grazed theres other paddocks they use on that part of the farm

Animals rule our place... cows, calves, sheep, goats, pigs, horses, donkeys, chickens, ducks... the list goes on
...."lifestyle block like" 25 or so acres around the house attached to a rather large farm with dairy drystock & a 600 cow dairy conversion :)....1500 acres to call home

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7 years 8 months ago #495973 by O BRIEN
Replied by O BRIEN on topic Grazing prices in franklin?
Thanks Katie

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