Making a success of first-generation sheep farming

With the number of council farms diminishing to 3,330 and the average capital requirement for new entrants running into six figures, the horizon doesn’t look bright for new entrants wishing to forge a career in farming.

But one couple has defeated all odds. Phil and Gillian Preece, first-generation sheep farmers from Powys, are proof that it is achievable to get a foot on to the farming ladder. But you need to be prepared to start at the bottom.

Seven years ago the couple started renting 73ha of bare land 10 miles away from their home in Much Wenlock, Shropshire.

“It came up for tender and we went and looked at it. We put a business plan together. We’d been looking for a few years and didn’t think we had much of a chance,” says Mr Preece.

The landlord’s main interest was to protect the single farm payment income; he was in the process of applying for HLS, so Mrs Preece’s background as a consultant was looked upon favourably.

Although being under environmental stewardship spawned difficulties – supplementary feeding and fertilising was banned – it helped reduce the competiveness for the land.

“Part of the reason we got it was because of the ground restrictions, because it wasn’t attractive to an established farmer,” explains Mrs Preece.

Financing the move was the next stage, which proved problematic.

With cashflow being seasonal, the couple decided to agree an overdraft of £10,000 with their bank.

“It was more cost-effective and easier to set up than a loan, as well as being easier to repay early and more flexible.

“If we’d of taken out a loan with scheduled repayments there might have been times when we were in credit on our current account, but paying full interest on a loan amount,” she explains.

“We used the money to purchase sheep, a second-hand quad bike, mobile race and trailer and parked them on the lawn at the front of the house.

“It was like farming from a garden shed,” Mr Preece says.

Then in the July that year the couple got married. While most newlyweds receive gifts for their house, Mr and Mrs Preece were brought sheep.

This sped up the genetic advancement of their flock and within the first year they had five Romney rams bred from the top NZ genetics.

Buying in healthy stock that was guaranteed disease free was a difficult task and they drenched and quarantined all animals that came on to the farm to prevent disease risk and transmission.

Money was tight so the couple minimised capital investment. They found a farmer in the spring of 2006 who was retiring and brought in-lamb hoggets and Welsh cross Romney ewes from him.

This gave them a total of 190 ewes within the first year, which they mated to the Romney tups. They retained ewe lambs and sold the wethers, slowly increasing numbers year on year.

“The wether lambs acted as our cashflow while we were trying to breed up numbers,” says Mrs Preece.

Then in the autumn they bought Welsh draft ewes for £10-20, which provided them with a cost-effective means of sourcing additional females for breeding.

For the first few years the couple juggled full-time jobs to pay the mortgage, with Mr Preece working in New Zealand pregnancy scanning from June to August, leaving Mrs Preece at home shepherding and balancing her career as a dairy consultant.

“It was quite a big responsibility and it was hard with Phil being away for such a long time, but we couldn’t have done it otherwise,” Mrs Preece says.

“Anything spare a month was going into the farm. It came at the perfect time if you had to struggle, because we didn’t have the children,” Mr Preece explains.

Then in 2008, after the birth of their eldest daughter Mary, now four, the couple applied for a Farm Business Tenancy (FBT) in Powys.

“We suddenly realised the children wouldn’t get any benefit from the farm.

“We were looking to move to NZ, but the exchange rate wasn’t very good and then within 12 months this place came up.

The family was in contention with 19 other applicants for Tyn-y-wain farm – a 113ha upland farm, near Llandridnod Wells. But after weeks of preparing a budgeting plan they were shortlisted for interview with one other and got the tenancy.

“They scrutinised us pretty hard to ensure we had the funds in place. We had to pay rent upfront, which included SFP, so we were forced to extend the mortgage on our house, as we didn’t get the SFP until two years later.”

The move to Wales allowed the couple to consolidate the business and sell any unproductive ewes, lowering numbers.

Seven years since their journey started, the couple – who now have two more children Kathryn, 16 months and newborn Owen – run an extensive 500-head flock of pure NZ Romney and 200 NZ Romney cross Texel ewes.

Of these 200 are bred pure to two SIL recorded NZ Romney rams, which are within the top 3% of the breed’s genetics. Half of these lambs are kept as replacements and the remaining 500 ewes are mated with a terminal sire, with 50 ewes lambs kept for breeding.

Ewes and lambs are fed on a diet of mainly grass, supplemented with homegrown and bought in fodder beet during the winter months.

“We run it at winter stocking levels so we have got plenty of feed in the winter for the ewes to keep going,” says Mr Preece.

For three months 200 ewes are out-wintered on grass keep on a pence a head a week basis.

“It is extremely cost-effective, because you only pay for what you get,” she says.

Both the feed efficiency of the Romney animal and careful planned grazing enables the couple to sell 500 round bales of hay, which acts as an additional income stream.

sheep preece

Lambing and management

With Mr Preece still taking on seasonal shearing and scanning work on more than 300 farms in the Midlands, North West and Scotland, planning ahead is vital and the ewes are sheared twice a year, in October and then again in July.

“We winter shear so they hold their condition better, don’t get on their backs in the spring and also we don’t have to shear them too early,” says Mr Preece, who is usually busy shearing for others in the spring/early summer.

Tups go in with the ewes in November for a maximum of five weeks. During scanning any late-lambing ewes are pulled out the flock and are sold to keep lambing intervals tight, with scanning rates currently averaging 180%.

Ewes are then lambed outdoors over a five- to six-week period end of March/April, with less than 1% assistance and a weaning percentage of about 160%.

Come August the majority of NZ cross Texel lambs are sold direct to slaughterhouse and anything left at the end of November is sold as stores in market. Last year fat lambs averaged £3.80-4/kg and at least 90% hit the target grade of R3L or higher.

The road into farming hasn’t been easy, but they say breed selection has been the secret to success – easing management requirements and enabling them to continue working.

“We had to have a system that enabled us to go elsewhere. The Romney breed and their extensive system enabled us to do exactly that.

“They have a good constitution, are very cost effective and do well on poor ground and when you’re starting out in farming it’s generally only poor ground you can get your hand on,” says Mr Preece.

In the future the couple hope to improve this further by using the top NZ Wairere genetics and increase numbers to 1,000 breeding ewes once again. But the couple says limitation of available land at realistic rents is currently restricting the growth of their business.

However, in comparison to many hopeful new entrants, they admit they have been lucky.

“We have been fortunate to find rare opportunities with private landlords, but most new entrants would struggle to get on the ladder without being given a chance on a county council holding.

And these, they say, are few and far between.

“The door has all but closed shut for many young people,” says Mr Preece.

Sheep farming is still the easiest entry sector, but the economies of sheep farming has gone up significantly since they set out, which further reduces opportunities, they add.

With new entrants desperately needed for agricultural over the next 10 years they say changes need to be made to policy to help younger entrants.

Council farms are a vital part of this process, acting as a “step ladder for progress”, says Mr Preece.

“County council holdings should be kept for genuine new entrants, not businesses expanding and they shouldn’t be held longer than 10 years, because at that stage you should be in a position to get a commercial tenancy.

“Otherwise the reality is many innovative young people may look for opportunities abroad and we will end up with a stagnant agricultural industry.”

First-generation farming is generating a lot of discussion on Farmers Weekly’s dedicated livestock forum Livestock Lines. Get involved with the discussion.

Top tips for new entrants:

  • Prepare a cashflow budget and review it regularly to work out how much you need to borrow and avoid any nasty surprises.
  • Shop around for the best rates, charges and payback opportunities; you don’t want to be paying back your loan by increasing your overdraft.
  • Consider using a 0% credit card. That way you won’t get charged on interest and for balance transfers.
  • Assess the landlords’ objectives carefully and tailor your application to them.
  • What rent should you pitch? Look at what the house would make on the open market. Be realistic.
  • “Be prepared to tender for poorer quality ground or land with restrictions/challenges; there is likely to be less competition for this kind of land.

Rhian Price on G+

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