David Anderson - Planning for the future and improving capital value through tree removal

Planning for the future and improving capital value through tree removalPrepared by: David Anderson

Rosebank Farm

October 2014

2014 AMS 40th Anniversary Industry Conference proudly presented by

Rosebank Farm – Our story

• We have a lifestyle property, purchased in 2003 for our

retirement

• Spent last 10+ years seeking to improve productivity

• Need to plan for future sale

• Property improvement project


An overview of what we purchased

• Purchased with 2,777 trees (now > 26 years old)

• Total orchard area 7.2 hectares

• 7m x 3.5m spacing (closed canopy)

• Steepish blocks creating significant water wash (soil erosion)

• Largely krasnozem soil



Our challenges to date

• Improve and maintain soil/tree health

• Design and implement water management plan

• Ongoing pest management

• Quality improvement

• Complete top-working trial

• Trial different canopy management techniques


Our results to date

• Fully paid for drying shed investment through improved NIS quality

• Consistently achieved > 3.5 tonnes per hectare

0.00

1.75

3.50

5.25

7.00

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

NIS tonnes/ha


The issues we need to resolve

• Deteriorating canopy volume (reduced production)

• Ongoing soil erosion

• How to maintain productivity in an ageing orchard

• How best to sell the farm within 10 years


Our 10 year objectives

• Maintain/increase productivity

• Reduce soil erosion

• Reduce costs

• Sell farm by 2021


The steps towards achieving our plan

• Create cash flow to determine economic viability of tree

removal

• Determine ability to cash flow the transition

• Commence program to remove every other row over 5 year

period


Cash flow - income

• Calculate NIS production by block

• Estimate kg/tree by block for each year

• Increment kg/tree by 20% p.a. over 5 years to minimum 80%

of original yield after each row is removed

• Assume conservative $/kg NIS price

• Calculate NIS revenue p.a.


Cash flow - expenditure

• Calculate all estimated costs, by category, p.a.

• Adjust chemical, fuel and oil, and labour costs as program

proceeds

• Adjust fertiliser costs (per tree) as canopy volume increases


Cash flow – outcomes

• Will vary - need to be conservative

• Cash flow will deteriorate during the tree removal phase but

will continually improve as the orchard recovers

• We have planned for this to take five years for each block


Our tree removal program

• S & G Agricultural Contractors (Simon Richens)

• Apply ethephon at appropriate time to enable early nut drop

and early harvest completion in selected blocks

• Book contractor as early as possible after final harvest pickup

• Second mulch to reduce high incidence of large debris

• Re-shape inter-rows if necessary

• Apply kaolin clay product (eg. SurroundTM) - sunburn

• Plant smothergrass and establish inter-row groundcover


Mulcher


Prior to tree removal


Post tree removal


Prior to tree removal


Post tree removal


What we’ve learnt

• Be courageous

• Plan, but be prepared to modify along the way

• Breakdown and spread mulch prior to next harvest


The planned outcome by 2021

• > 1,300 trees

• > 5 tonnes per hectare

• Costs reduced by about 35%

• A great looking and saleable property!


Any questions?

We’re happy for you to make contact later:

David or Ann AndersonRosebank Farm

Telephone: 02 66882280Email: [email protected]

mailto:[email protected]

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David Anderson - Planning for the future and improving capital value through tree removal