How one farming family drought-proofed their business by taking back control
A bold silo investment has revolutionised a Central West NSW farm, with the investment paying for itself in just one harvest season.
Matt Sheppard and the Paragon Pastoral team savoured their first cold beer, “to wash the dust down”, at the completion of this year’s harvest.
After 3½ weeks of working around the clock to bring in the 20,000 tonnes of wheat, chickpeas, faba bean, and canola, that Matt and his wife Mel grow at Rosee near Coonamble, in Central West NSW, it was deeply satisfying to look over hectares of fresh golden stubble and know their silos were full to the brim.
“We were fortunate to have a good run with the weather, as storms affected much of the region this year. We sent the canola to town and we’ve kept the rest,” 42-year-old Matt said.
This harvest has been especially rewarding for the Sheppard’s, because it marks the fruition of an ambitious plan to transform their generational farming business.
After starting their careers in agribusiness banking, newlyweds Matt and Mel returned to the land in 2010 with a dream of scaling up the enterprise which Matt’s parents established in 1979.
Forming the Paragon Pastoral Co, the first step was to expand their footprint, successfully acquiring neighbouring properties which doubled the size of the holdings. Next, they focussed on streamlining farming operations, notably investing in state-of-the art Kotzur silo system to store their grain on farm, a move which proved a game changer.
“It’s been huge!” Mel said. “The efficiency of logistics at harvest time is just phenomenal, not being at the mercy of weather or wait times is amazing.”
Today, their Paragon Pastoral Co mixed enterprise has 5200ha of grazing for sheep and cattle, and 10,000ha of broadacre cropping.
LONG TERM
Matt Sheppard always knew that one day he’d return to the family farm, and in Mel, who grew up on a cattle stud near Armidale, he had a partner who shared his love of agriculture, and his vision to build on his parent’s legacy.
However, it wasn’t long before the young couple faced drought, battling through three tough years from 2013 to 2015, and a further dry spell from 2017 to 2019. The unpredictability of the weather, and boom and bust cycles, forced them to cast a critical eye over operations and find a long-term solution.
“We had to work out how to make money during the dry periods, how to drought proof ourselves,” Matt said.
Although they’d always held small amounts of grain on farm, in 2020, they super-charged their storage, installing four Kotzur silos, capable of holding 1800 tonnes each.
“Cash flow is the most important part of any business so controlling when you sell, who and where you sell to is the pinnacle. The silos allow us to maximise that crop return by holding the grain until the market is more favourable, because at some point over the cycle of the year, the price will go up, and will be significantly more appealing than the price at harvest time,” Matt said.
“We have greater control of our product and logistics. We know, it’s hard to grow. Farmers can’t afford to just give it away. Our goal is to have silos full all year round. Prices naturally go up during drought, it’s the nature of the beast, so we have try to make the most of those opportunities.”
LOGISTICAL REWARD
Financially and logistically, it was a big undertaking, which they forecast would take 10 to 15 years to fully complete. Incredibly, they saw returns after the first harvest enabling them to complete the project much sooner, with 11 silos, full automation of a road pit, bucket elevator, infeed drags and diverters and an 81-tonne garner bin for accurate load outs, installed by the 2024 harvest.
“It was a big decision and significant investment but we were able to utilise the complex from the first year, and saw stage one pay for itself in that first harvest,” said Mel, a practising accountant.
“When you put your grain into a bulk handling facility, you are paying storage fees plus freight costs which are exorbitant during harvest compared to throughout the year, and it adds up.”
“The nature of the industry means we are price takers so we are doing our best to maximise margins, by reducing costs that we can control. We have more control over are in control of our price, rather than being at the mercy of the market.”
BIG BENEFIT
Matt said one of the most striking benefits has been the ability to store high moisture grain.
“In 2020, a wet harvest was forecast so we started harvesting and filled our silos with high moisture grain, 13 to 14 per cent which you can’t deliver into the market. We brought the moisture down, and we were able to capitalise on the rising market.”
The towering stainless-steel silos make a striking addition to the farm, but Matt said the project wasn’t without its doubters.
“I did sound out a few people, before we did it, and they weren’t for the idea, but I didn’t let that deter me,” Matt said.
“It was a huge undertaking, but we were confident with our figures, and we have a great relationship with our accountants and bankers,” said Mel, who worked for NAB after graduation, and still works as an accountant in town a few days a week. Matt also cut his teeth with NAB.
“Both of us having a background in banking gave us the confidence in our numbers and how far we could push ourselves,” Mel said.
During harvest it’s a huge team effort, with contractors and 25 staff.
Matt’s parents Mick and Judy remain active on the farm and Matt and Mel hope that their vision and investment has set the farm up for the next generation, their three children, Indie, Lydia, and Ned.
“We both love farm life,” Mel said.
“Although we are isolated, we have a fantastic community out here , many of us in the same situation coming back to farms. It’s a wonderful network.”
“We love the challenge, every day is different , it’s never mundane.”
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