Yalgoo Merino: Genetic gain crucial for the Nivison family.

THIS Merino man says the days of lifestyle sheep farming are over, writes JAMIE-LEE OLDFIELD.

Principal man: Jock Nivison of Yalgoo Merino stud on his farm near Walcha in northern NSW. Picture: James Wagstaff

THE Yalgoo Merino is a constantly evolving package of genes, bred to add more value into the next generation.

Each sheep is backed by 45 plus years of objective measurement, ensuring genetic progress is measurable, profound and assured.

This is how the Nivison family describe their flock of Merino sheep, and stud principal Jock Nivison is serious about making sure it rings true.

Yalgoo Partnership is a family owned and operated livestock operation based on NSW’s Northern Tablelands where the annual rainfall on their 3300ha is a summer dominant 750mm.

The Yalgoo Merino stud consists of 650 breeding ewes, and the Nivisons also run a commercial flock of 6700 ewes, as well as having a stud and commercial beef arm. If that’s not enough, they also have another seedstock Merino enterprise in Tasmania, Ashby Merinos, operated in partnership with the Bennet family at Ross.

Fast tracking their genetic gain across the Merino flock has been crucial to improving the profitability of their, and their clients businesses, says Jock Nivision.

“In my opinion the days of producing sheep for the lifestyle are over, and I see it as a call to arms for seedstock breeders that if we aren’t winning the battle, next year we will have one less client who needs to sell up and change enterprises to alleviate the cost price squeeze,” Jock said.

“The prices we’ve paid and prices we receive as farmers are separating at 2.2 per cent per annum.

“If we are not reaching that 2.2 per cent of genetic gain, it’s removing an important tool for our commercial clients to stay ahead of the declining terms of trade.”

PRODUCTIVITY RULES
JOCK says while prices are often fixed and beyond the producer’s control, productivity isn’t.

“Declining terms of trade have been compounded by low productivity, and agriculture productivity has dropped by a third in the past 12 years,” he said.

“Any growth that has happened has happened in the cropping sector, the worse performing has been sheep and beef and worse of all the wool industry.

“Why the lag in the Merino industry? Because there are more perceived profit drivers in the Merino industry, which means there are more profit diluters and less selection pressure on things that drive profitability in business.”

Looking at the traits that drive profit within a Merino operation led to the creation of the Yalgoo7-15 Index in 2012. It was designed to move the flock at Yalgoo to cutting 7kg of 15-micron wool.

“Where does majority of income from in a self-replacing Merino flock? Well we shear every sheep every year, while we can only sell 47 per cent to remain self-replacing. So why don’t we work on the greater percentage to get the greater gain,” he said.

“In an average year a greater majority of income comes from wool, why don’t we maximise that.

“Wool hasn’t been the sexiest thing to talk about, but we are passionate about it and where we can see we can make a lot of economic gain.”

TWIN GOALS
THE first part of the Y7-15 equation — maximising wool cut to 7kg, ensures production. The second element — 15 micron wool — was decided upon when research showed wool two microns below the national clip average had not received a discounted market price since 1980, and ensures price.
This coupling of fibre diameter and fleece weight has led to a $30 increase in fleece value over four years.

“There has been genetic gain, but more importantly it has been the rate of gain that has driven the profitability in this flock,” Jock said.

“The internal rate of return gain has been 11 per cent per annum … that is 11 per cent compared to 2.2 per cent decline in trade and has gone a long way to address income issue.”

Jock said management at Yalgoo was based on matching feed supply and demand. Ewes are joined in May for five weeks, at 1 per cent plus one rams to ewes, with nearly half the commercial ram battery replaced each year.

“All rams are classed annually for structure fertility and on index. This ensures only the highest performing and most able rams are joined to ensure ram’s handle high ewe demand,” Jock said.

“The stud flock moves at about 7-10 index points per annum, ensuring that we maintain a young, genetically superior ram nucleus.”

Lambs drop in October onto paddocks that were free from grazing from February to May, at a long term average of 100 per cent.

Ewes and hoggets are shorn in August and September prior to lambing, with two age groups of wethers retained and shorn when wool length reaches a minimum of 60mm.

CONTRACT HIT

JOCK said they traditionally sold wool through the auction system, but were moving more towards contracts or “a more integrated approach to selling, where we have a more tangible relationship with buyers and retailers”.

Yalgoo is a founding member of Tablelands Merino, a consortium of 12 wool growers providing a single point of contact to the largest pool of sub 17-micron wool in the world, and has also formed an alliance with Norwegian Garment maker Devold.

Yalgoo has used an index based approach to increase profitability through impressively fast genetic gain, and finding the best rams in the industry has been a catalyst to this, says Jock.

“Cast a wide as net as possible to find the extraordinary sheep and breed from them,” he said.

“We have a high ewe and ram turnover in the ram breeding nucleus, we turf out about half our stud ewes every year and same with our sires.

“Population genetics has played a big part, we have a large commercial flock behind our ram breeding nucleus so we want to use all those sheep.

“All those sheep need to prove themselves on Yalgoo index to stay in commercial flock, and tops upgraded to ram breeding nucleus.”
All ewes have electronic tags and, as they come through the shed at shearing, have their fleeces weighed, fibre diameter and bodyweights recorded, and are ranked 1-3000 on the index.
Jock said the top 100-200 were eligible for ram breeding nucleus, the next 1600 retained in the commercial flock and the remainder surplus.

OUTSIDE THE SQUARE

YALGOO hosted an on-property surplus sale for nearly 50 years, but they now AuctionsPlus to run a combined sale with long term client TA Field in February-March.

All Yalgoo surplus stock are also listed on their website, along with their client’s stock.

Yalgoo’s very single focus one fibre diameter and fleece weight within their flock hasn’t necessarily been popular with the Merino Industry, Jock said, but it had driven profitability.

“A lot of people didn’t think this was the right way to go genetically, but we were comfortable with historical wool prices and the amount of gain we could get … and rewards have come a lot quicker than a lot of people would expect in genetics,” he said.

“There has been a lot of different trends in the Merino industry over the years, we have put up the shutters to that and stuck with what we thought we were on firm economic ground with.”