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  • Business Edge

    Spring 2017

Seeing the Wood for the Trees (cont'd)

Lee Family

It was a combination of both good luck and bad luck that saw the Lee family settle in their farm just outside Reporoa, according to Sylvia Lee.

During both World Wars, the New Zealand government decreed that soldiers returning from overseas service would be given the opportunity to settle on farms of their own, including land especially purchased and developed for that purpose. If there was more than one applicant for a property, a ballot was held.

According to Sylvia, “When my father-in-law Alan came back from the war, he went into the Returned Services Ballot. You literally got a number in a barrel – a total lottery. He drew a ballot for land just out of Masterton but sadly in the early 60s he was one of the last group of that era to contract polio. The Commissioner of Lands felt that Alan should be resettled to a flat farm and so he was offered a civilian ballot here at Reporoa – there were four marbles in the ballot and Alan drew this farm.”

When Alan and Dorothy came to the farm there was basically nothing, other than a wool shed and four paddocks. The first few years were touch and go for the couple. The ground had copper and selenium deficiencies and the weather was quite different as the Kaingaroa forest was 50 years younger. It snowed regularly in winter and the frosts were quite severe. As Sylvia’s son Hamish puts it, “It was rye grass but similar to the Desert Road. It was difficult and because Alan had polio, it was that much harder.”

Alan had been an active part of the Farm Forestry Association in the Wairarapa and he brought the practise to Rotorua.

“Dorothy would often say that Alan would prefer to double-fence a shelter than buy something for the house. Everything went into the farm,” laughs Sylvia.

 Scottish-born Sylvia met husband Ben in 1976 when he was doing his OE over there. The couple ultimately came to the farm in the early 80s, when Benjamin’s brother Jonathon and his wife drew a ballot farm at Akitio in the Waiarapa. “We were having a lovely life shearing in the summer and working in the Ohakune ski fields in the winter. I was a bit reluctant to be honest.”

They started farming after they got a stock loan in 1983 and leased the farm from Dorothy Lee. With a five-year loan to repay, they thought they would work hard and go for a ballot farm themselves. Those plans were scuppered when the government knocked ballot farms on the head the following year.

At the time, the Lee’s sheep and beef farm barely broke even and they were at the mercy of fluctuating wool prices. They couldn’t get into cattle as they just didn’t have the money. They did a lot of dairy grazing so they commissioned a feasibility report for converting to a dairy farm. Things weren’t great in dairy industry but it rallied the following year so they decided to go for it, and Dorothy made it possible by selling the farm to them at a very reasonable price.

So how did they feel about the very daunting prospect of converting the farm?

“It was so exciting. We were young, we could see a future….Ben was just thrilled. He spent night after night doing numbers and running through the figures and as I was busy having babies, I told him “just hit me with the big numbers and if you can sleep at night, so can I.”

The day we bought the cows, the dairy forecast went up. There was a sequence of very happy events that proved to us that we’d done the right thing. To begin with, we milked our cows through the neighbours’ shed.  We walked our cows across and helped milk each other’s cows and split the costs of the shed. We had a three year contract with the other farm but the first two years were so successful that we built our shed and converted the rest of the farm and got our shed up and running a year earlier than we anticipated. The Dairy Board in those early days used to do lovely things like give you a two-for-one share issue. We felt very lucky.”

Reluctant to have to pay for grazing their heifers, the couple decided to buy another property, at River Road, Akitio, near to brother Jonathon’s farm. As three separate bits of land, it wasn’t deemed ideal and was probably priced accordingly but again they turned adversity to their advantage as it kept the various classes of stock separate.

Carrying on the family tradition started by Alan, Ben became a passionate tree planter and was an active member of the Farm Forestry Association. . When their neighbours converted to dairying, they had a ribbon of paddock, which the Lee family bought, planted the hill in trees and grazed the top. They recently harvested some of their trees and they went through Donelley’s Sawmill, a very satisfying experience. Son Hamish reckons that they could plant five - ten acres of trees every year for the next 15 years and not lose any production out of their farm.

 

The Lee’s relationship with BDO goes back over 30 years, as Sylvia notes.

“One of the things that Ben and I always felt lucky in was our choice of lawyers and accountants. When we bought the farm, we had very little money so when BDO told us that we could claim the GST on something we hadn’t fully paid for, we were delighted.”

Sylvia and Ben’s sons, Hamish and Sam Lee, are the third generation to farm the land. With a new generation comes change but not without a strong appreciation for the lessons learned from the past. Stephen Graham and the team from BDO have helped the Lee family add a more ‘corporate’ structure to their business. There is nothing simple about dairy farming, so the family now sit down as a group and work on governance decisions in a more formalised way.

Moving to cloud-based systems accounting with BDO’s guidance has also been a huge benefit for the family, according to Hamish Lee.

”It’s been a big learning curve, but it’s allowed us to be quicker to make decisions and move on our feet. We used to have meetings and we’d all be sitting with different versions of our cash flow, flipping through a huge out of date paper file. We’re literally now looking at the same live information source. I can open up my phone on the farm and get a live update, which is really useful when we run farms remotely.”

The family now has a herd of over 700 and has eyes on growth. A far cry from the barren landscape of the 1960s and that first generation of reluctant ‘lottery’ winners.