Investing in growth
Published: 27 June 2018
“Sitting still doesn’t work any more. To future-proof your business, you need new ideas for how to diversify or expand.” So says Ivor Gaston, a farmer whose drive and willingness to try new approaches has created a hugely successful multi-site agricultural business.
Within just 18 years, Ivor has expanded from 68 acres in Ballymena to 1,200 acres at farms in the Scottish Borders, Northumberland and Stranraer. A move into dairy and pigs, as well as embracing technologies such as robotic milking and a biomass boiler, has allowed Ivor, son Robert and grandson Adam to keep their business low risk.
In Northern Ireland, Ivor and his wife Rosemary reared pigs, at one stage expanding their herd to 4,500. When Robert joined the business in 1988, the farm had reached its limit for potential growth.
The family looked at opportunities on the mainland and, in 1999, bought Ravelaw Farm in the Scottish Borders, bringing all their farm equipment with them in five trucks. There – on 460 acres – they grew wheat, barley, rape and beans and fattened weaner pigs, keeping costs down with home-grown feed. Ten years later, they bought another 400 acres of arable land in nearby Northumberland.
“In 2012, our previous bank began to overload our business with higher interest rates,” says Ivor. “In hindsight, this was a positive changing point for us because it led to our connection with AMC, which has been able to give us the financial support we needed to bring additional plans to fruition.”
Those plans included selling off the Northumberland Farm and buying neighbouring Whitsome Hill Farm in Berwickshire – a change made far simpler thanks to AMC’s help, says Ivor.
A third generation has now joined the business and Adam, at just 20, has already shown an impressive grasp of the business.
In 2017, the family identified an opportunity to buy a 365-acre dairy farm in Stranraer. “Having been with the family for many years, I know they’re the sort of people who are always considering ideas and proposals, but this came as a surprise,” says John O’Meara, AMC Regional Agricultural Manager.
“When Stranraer came up, I was quite sceptical. It would be their first venture into dairy, but they explained their thinking and how they had done their research. And, of course, they had an exceptional track record. I could see they were aiming to add more strings to their bow and create revenue streams, so was happy to give them the funding they were after in the format they needed.”
“We have lots of options, and we’ve spread our risks. It’s unlikely that arable, pigs and dairy would all go bad at the same time”
Future-proofing through spreading risk
Ivor explains the thinking behind their plan. “Dairy isn’t as reliant on the single farm payment,” he says. “Look at arable, for example. If the subsidy is reduced, the value of the land might well fall. The value of dairy land, meanwhile, may actually increase. Indeed, we’d spoken to a few dairy farmers and it seemed confidence was higher than it had been for 10 years. The UK isn’t self-sufficient in milk and the possibility of tariffs after Brexit may create growth opportunities for the British dairy sector.”
Robert adds that they had considered different possibilities. “We could have added poultry, a sow unit or an anaerobic digester to the Berwickshire farm, but they would just have been bricks and mortar in the long run. The land at Stranraer will always be worth something and if it continues to be as successful as our five-year plan suggests, we could expand there,” he says.
“It’s important to take risks, but you also need to know what you will do if you don’t get the right outcomes. We have lots of options, and we’ve spread our risks. It’s unlikely that arable, pigs and dairy would all go bad at the same time.”
Investing in technology
One of the selling points for the Stranraer dairy was its technology. Cows are milked four or five times a day by robot milking machines. There’s auto-scraping and two large slurry storage tanks with an umbilical system. The Gastons have also recently bought a zero-grazer, bringing fresh grass into the barn-kept cows.
“We currently milk 140 animals, and we have plans to increase the herd to more than 200 by the end of this year. It helps to have a great manager looking after our herd,” adds Robert.
The business is managed for them by farmers with immense expertise and a real passion for dairy, and a rolling contract with a nearby creamery has given them a steady market at a good price.
“The automation of the dairy farm takes the stress of working with people away from the cows, and they can actually yield more milk,” says Ivor. “The more the cows get used to the system, the better the robot works. It’s a fantastic piece of kit.”
“We needed financial help from AMC to bring our plans together – but they stay in the background, which is just what we want. We know we can call John O’Meara with any new idea, because he’s open to what we’re trying to do.”