Years of drought in northern New South Wales led Gunnedah region's Sam Conway to establish an innovative 'co-farming' business model to reduce production risk for small to mid-sized broadacre farmers.
This month, Mr Conway's impressive business plan for the new enterprise, which outlines a comprehensive strategy to take the business to its next level, earned the progressive young producer this year's Rabobank 'Dr John Morris' Business Development Prize – a prestigious trans-Tasman business prize awarded annually as part of the Rabobank Executive Development Program (EDP).
Mr Conway, CEO of Boolah Farms – an integrated farm management, grain-handling and broadacre contracting business – established, the collaborative farming model (known as 'Co-Farming') in 2020, along with his wife Molly and Stuart and Lyndall Tighe. This followed three years of drought in northern NSW, with the aim to "reduce production risks by giving smaller landholders access to scale and geographic spread".
"During those years of drought, we noticed there were some properties that did receive rain and had quite good production seasons where others did not have any production, purely due to where the storms fell," Mr Conway said. "The goal of Co-Farming is to flatline the peaks and troughs of production in a cropping-focused business."
The Co-Farm model revolves around small to mid-sized "passive" landholders contributing their land into a joint venture, where operating expenses and profits are shared on a percentage basis. This percentage basis is determined by taking the market value of their contributed land divided by the total market value of all land in the joint venture. These properties are then all operated as one.
Boolah has a team of 30 full-time employees, carrying out overall management, contracting and grain-handling for the Co-Farm group.
Malt barley is the "pillar crop" for the enterprise, focusing on provenance-based, transparent, direct-to-customer marketing. Other crops grown are cotton, sorghum, durum wheat, canola and chickpeas.
The business currently consists of nine landholders and has operational cells in two regions, Gunnedah and Moree, with a third region kicking off at the start of 2023 at Belatta, also in northern NSW.
Mr Conway, 30, one of the 19 participants in the 24th Rabobank's Executive Development program, was presented with his prize at the program's graduation lunch in Sydney earlier this month.
Tailored to assist progressive Australian and New Zealand farmers seeking to take their enterprises to the next level, the EDP is designed to develop and enhance participants' business management skills.
Run over two one-week residential modules – held over consecutive years – the program covers all aspects of business management including strategic business planning, negotiation, financial management, risk management, communication and innovation.
To date, more than 800 primary producers having graduated from the EDP since the program's inception in 1999.
On the horizon
With the Boolah Farms Co-Farming structure currently operating within just a 300-kilometre radius, Mr Conway said he had used the learnings from the EDP to assess the business's current position and develop a five-year plan to establish more farming cells in different geographic areas to provide further risk spreading to the group.
"Every year somewhere in Australia's grain-growing regions, there is a drought, flood, hail storm, mouse plague, disease or some event that is out of the grower's control that heavily reduces the return of that farm for that year. These events are always at random – but are most commonly isolated to a region or state," he said.
"Currently the Co-Farming business is isolated in northern NSW and to be able to achieve our goals to flatline the peaks and troughs of production in a cropping focused business, we are aiming to establish land bases and operational cells into two new geographic regions. The regions will be replications of our current regional cells. Our initial target is 10,000 hectares in each additional region, established by 2025 and 2027 respectively.
"We have developed what we believe is the ultimate model and the business is operating, but on reflection of where we are today, we must bed down some important aspects within our business to allow us to progress towards 'horizon two' of farming in different regions."
This includes increasing the amount of land contributed long-term to the joint venture by landholders (rather than short-term by lessors) to more than 80 per cent by 2024, without reducing scale. This will reduce the risk of land exiting the operation and provide more security to landholders in the joint venture, Mr Conway said.
Other planned actions include implementing an enhanced remuneration system to "attract, maintain and continue to engage good people in our great team of employees" in the expanded operation, establishing an external advisory board to assist with future growth and planning for scaling up equipment to allow for geographical expansion.
Impressive on several levels
With 14 EDP participants presenting their business plans for the Rabobank 'Dr John Morris' Business Development Prize', program director Robin Stonecash said Mr Conway's project showed he applied the tools and frameworks from the EDP to rethink the business and set himself up for success.
"His insight about the challenges to the business let him develop a solid plan for future growth. In addition, his project showed that he had developed his own leadership and presentation capabilities as a result of his time on the EDP," she said.
The judges were also impressed with Mr Conway's project when considering the headwinds facing the business – saying he had used the EDP's business management project to chart a path towards future revenue growth and greater stability.
"Integrating insights and knowledge from the program, Sam demonstrated a clear and concise strategy for Co-Farming that weighs many of the issues agriculture faces across the region currently," Dr Stonecash said.
Chris Baker "Willawee" Yarrabandai, NSW was announced People's Choice Winner thanks to his successful strategy to reduce overall farm debt through refining the enterprise mix and identifying key financial drivers within the business. And Scott Colvin, a livestock and mixed cropping operator at Blackwood Creek in Northern Tasmania, and David Sheridan, Rural Funds Management's National Manager – Livestock, also received a special mention, with highly commended projects.
