Flowers give hope to farmers

Press, 24 April 1987, Page 26

Flowers give hope to farmers

By

DAVID LUCAS

A o.sha patch of flowering tubers is giving a young North Canterbury farming family hope that they will not be forced to sell their U3ha mixed farm.

Although it is still early days for the flower-grow-ing horticultural venture of Simon and Vicki Ensor, of Fernside, they have already overcome a major hurdle which had threatened to stifle development of their project A sum of $30,000 raised from outside investors has been injected into the flower and tuber-growing side through a sharefarming agreement giving the project a muchneeded boost in capital. The Ensors planted their first 1500 zantedescbia tubers (calia lilies) two years ago after reading about the potential of the flowers and tubers in a magazine.

At that stage they could foresee worsening problems for traditional farming and they reasoned that getting in on the ground floor of a new industry which had an optimistic outlook was worth the risk. They were encouraged by the success fo the first crop of flowers, but Simon quickly became aware of one major problem — a lack of scale. "We could see the potential, but realised it would take too long to build up tuber numbers without investing heavily,” he said. They had already “scraped the bottom of the barrel” in finding $2OOO to buy the original 1500 tubers, and because the farm’s finances were in a desperate state the Ensors had no hope of raising the money themselves for expanding the flower-growing. They advertised for partners to develop the project on a share-farm-ing basis and eventually two willing investors provided a total of $30,000 enabling the purchase of 25,000 tubers. Under the share-farm-ing agreement, the Ensors provide the land and equipment and do most of the work in return for a half share of the net profit from the sale of flowers and surplus tubers. The investors keep the other half of the net profit as well as retain owner-

ship of the original tubers purchased by their investment Simon Ensor estimates the investors should make a 30 per cent annual return on their investment — looking at it optimistically the return could reach 130 per cent Flowers from the partnership’s first crop (this season) got an excellent reception from florists and exporters which further confirmed the Ensors’ belief in the future of their new industry. Overseas customers had indicated they could take more than 1000 cartons a week — the Ensors’ output for the whole season was just 10 cartons from young tubers. In 1985-86, New Zealand exported $250,000 worth of zantedeschia flowers and this was expected to double during the season just finished. The Ensors are gradually learning by experience the pitfalls and skills needed to grow horticultural crops to exacting export standards and have received a lot of advice from an existing grower in Whangarei whose flowering season runs from November to late

December. In Canterbury the season goes from midJanuary to March, meaning Northern Hemisphere markets can be supplied by New Zealand for five months of the year. They would like to double the area devoted to tubers next season and within the next two years have 60-70,000 tubers in production in a determined effort to provide their farm with a profitable diversification. “Otherwise there is no point in carrying on farming and just building up debt,” said Simon. “We have got to have a greater earning capacity.”

The initial success of .their new venture has made the Ensors feel much more secure than they were a year ago, even though their financial position has deteriorated sharply. If they had sold up 12 months ago — a move suggested by a stock firm — the Ensors would probably have been able to retain a car and their

household effects; if they sold today there would be a shortfall of about $50,000. Ironically, Simon Ensor believes they have a better chance of staying on the farm with a big debt because the mortgagors would now lose money if the farm was sold. He has applied for debt restructuring, but the application is not expected to be considered until June.

Vicki Ensor said they went through a depressing period 12 months ago when they foresaw farming’s problems getting worse because of high interest rates and declining product prices. “Depression was settling in; we kept wondering what on earth was happening to us,” she said. “It was distressing having to retrench and see our work go backwards.”

Their financial budgets showed the financial position would deteriorate further and Simon said he had found it difficult to

cut expenditure on essential inputs because he liked to do things properly. He remembers the feeling of hopelessness he experienced when last year at the end of harvest he parked the header in the shed with the know- - ledge that the silos were only half full and their budgets showed a crisis looming. Simon Ensor pinpoints the major problems facing cropping farmers as the massive drop in product prices — some are down to half the level of previous years ■ ; — and the increasing cost of inputs.

He knows he can produce good crops — in 1984-85 the gross income from the farm was an impressive $lO6O a hectare. “The yields that year were good, but not exceptional, and I could reasonably expect to repeat it,” he said.

"One more year like that and we would probably have been able to take most things in our stride because our equity would have started to build up.” However, two difficult seasons and the collapse

in product prices, high interest rates and inflation dashed any . hopes of quickly getting on a solid financial footing. Not surprisingly Simon Ensor has changed his approach to farming and intends to swing back to a lower input system and double his small sheep flock to about 1000 ewes. Where previously he followed a policy of aiming at a high gross income from crops he now takes the option with the least financial risk, such as growing oilseed rape and running sheep.

The Ensors’ farm was previously part of Simon’s father’s property which in 1980'was divided between Simon and a brother, James. One of the first moves by Simon on takeover was to boost the cropping area to 60 to 70 per cent of the property. Two very dry years when rainfall was half to two-thirds the average convinced them of the need for irrigation. Delays in installing irrigation during the drought of 1982 led to the third disastrous harvest in succession.

However, with 70ha of the property irrigated, excellent yields can be achieved although much still depends on the weather. In 1985-86, they won a regional award from the South Island Barley Society for producing 7 tonnes of Fleet barley a hectare. In 1985, Simon Ensor took part in the Landline farming programme on radio where he commented that it was difficult to plan in the long term when the rules had been changed so dramatically in the short term.

The Ensors are now anxiously hoping their horticultural venture will eventually pay dividends, although they realise it will be two to three years before it could reasonably be expected to contribute to the farm’s income. “In the meantime it is giving us something to put our energy into and to work towards,” said Vicki.

Simon Ensor has fitted a spray rig to a farm motorbike to spray the lilies and has found it ideal for quickly and efficiently spraying small areas, such as lawns. With 3m and Im booms available, he hopes to do some outside contracting to help their cash flow.