SYSTEMS OWNERSHIP
Michael and Cheryl Shearer with their family of five kids.
Realising the ownership goal A partnership with his parents means Marlborough dairy farmer Michael Shearer is on target to farm ownership. By Anne Hardie.
A
t 29 with five young kids on the go and a wealth of dairy experience stacked up, Michael Shearer and his wife Cheryl now have a 50:50 equity partnership in their first farm, a sharemilking contract on a farm nearby and are in the throes of buying a support block. The equity partnership is with Michael’s parents on a 62-hectare dairy farm they bought near Canvastown, while a few kilometres down the road they are in a 50:50 equity partnership in a sharemilking contract with a friend who has been his best mate since he was 10 years old. 38
If his non-dairying parents had not been keen on the equity partnership as a step toward farm ownership, Michael says they would have sought investors to achieve the same result because they were keen to realise their goal but needed more capital. “We definitely needed that outside equity to get ahead as quickly as we have – I’m pretty impatient.” The partnership bought the farm five years ago for $35,000/ ha and carries a debt today around $20/kg milksolids (MS). Michael and Cheryl have their 50% share of that debt, plus the debt covering 50% of the costs to set up for the sharemilking contract down the road. Their goal now is to buy out his parents’ share of the partnership in five years or so, with income from the sharemilking contract making that more achievable. They may have more debt nowadays, but their dairy business is simpler than ever. They milk once a day (OAD), have few inputs, no crops and the platemeter that was once Michael’s pride and joy only gets an outing in winter when the cows are on rations. Best of all, Michael is enjoying being his own boss and being accountable just to himself for the most part, while consulting with his parents on the big spends. Coming from non-dairy careers means they can offer a fresh approach to the business which Michael sees as a positive in their partnership. For day-today management, Michael needs no staff and Cheryl manages Dairy Exporter | www.nzfarmlife.co.nz | November 2021
