Riverina couple reduced risk by leasing

Share-farming and leasing properties enabled a Riverina couple to reduce risk

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Kendra and Brent Kerrisk, Ganmain were able to reduce risk by leasing and share-farming. Ten years later they are preparing to farm themselves and have started an oats and olive oil business, Brushwoods.

Kendra and Brent Kerrisk, Ganmain were able to reduce risk by leasing and share-farming. Ten years later they are preparing to farm themselves and have started an oats and olive oil business, Brushwoods.

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Creative ways to enter farming despite soaring land prices.

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Entering farming is becoming more and more restrictive as land prices surge, but Kendra and Brent Kerrisk, Ganmain found share-farming and leasing properties enabled them to get a foothold in the industry.

The Kerrisk's, both from rural backgrounds in New Zealand, came out to Australia 14 years ago with the goal to buy a house with some acreage.

However, living with their two sons, in Camden, near Sydney, they couldn't afford what they were after so decided to keep renting and working in Camden and buy some farmland elsewhere instead.

"We had family and friends in the Riverina, they said it was a good area to buy there," Mrs Kerrisk said.

"They also put us in contact with the Kember family to be potential share farmers for us."

In 2008 the Kerrisks bought 260 hectares at Coolamon and asked the Kember family to crop it for them.

"That was a 70-30 per cent arrangement," Mr Kerrisk said.

"We own the land and we took the 30pc after harvest with no costs."

Mrs Kerrisk said although the Kember's paid for the inputs, it was their responsibility as the owners to maintain infrastructure.

"We would come down and do fencing and we paid for any capital fertiliser, so any lime applications," Mrs Kerrisk said.

Mr Kerrisk said the on-farm decisions were left to Wes and Nathan Kember.

"They would always come back and consult us, but there was minimal input from us," Mr Kerrisk said.

He said 18-months after they bought their first block, a neighbour's 260ha property came up for sale.

"It was a little early for us to jump but we probably had to to give us some scope," Mr Kerrisk said.

They decided to lease this block out to the Kember family and eventually purchased two more blocks (155ha and 280ha) over a 10 year period, both leased out to the same family.

Starting with a safety net in place 

Mrs Kerrisk said share-farming and leasing arrangements helped them to retain cashflow and reduce risk.

"It was a safety net," Mrs Kerrisk said.

"We had secure off-farm income and even if it wasn't the best return on capital we just needed to be comfortable that we were going to make enough off those blocks to pay the mortgage without any real risk.

"If we had a five year drought and got nothing off those farms we could still pay the mortgage without really having to change how we live."

Mr Kerrisk said the other aspect was they didn't have enough knowledge to jump head-first into farming.

"We didn't have the confidence to do it ourselves, so we got locals in and we probably increased our knowledge over the years," Mr Kerrisk said.

The Kerrisks decided to relocate to Coolamon in 2017, moving into the house on one of the blocks they had leased out.

As well as the house they had access to a small olive grove which Mrs Kerrisk decided to rejuvenate and started a business, Brushwoods, producing olive oil alongside vacuum-packed oats.

"The oats side of the business has only been going for two and a half years, currently our throughput is five or six tonnes a year," Mrs Kerrisk said, explaining she rolled and packed the oats from home before they were distributed to stockists, cafes and sold online.

Mr Kerrisk is also about to start a new venture.

The couple has just settled on a new 460ha block that Mr Kerrisk plans to farm himself along with the block on which they currently live.

"The new block is in two titles, a house block and a block that we're leasing at the moment with a put and call option in place, which means but we have to buy it in three years time, the price and terms are already locked in," Mr Kerrisk said.

Mr Kerrisk said they planned to crop cereals, canola and peas on the combined 740ha, while continuing to lease and share-farm their other properties to the Kembers.

"I'll probably transition into farming over the next few years, the plan now is to still work full-time, I think I can do it myself with the assistance of contractors when required," Mr Kerrisk said.

"In the last year we've started purchasing machinery so we're ready for this year's planting."

"We've put a cropping plan together in the last few weeks and the summer spraying program has been going for the last two months."

Would the model work today? 

After just over a decade the Kerrisk's model of buying and leasing property has enabled them to be in a position to start farming themselves.

But, Mr Kerrisk said he wasn't sure the same model could be applied for people starting out today.

"We went from paying $900/acre when we started, to nine or 10 years later paying $1800/acre and now land here is worth up to more than $2500/acre," Mr Kerrisk said.

"When you're paying that much for land, share-farming doesn't work and I don't think leasing does either, you need to be bringing in more revenue.

"There used to be a rule that leasing you could get five per cent of your land value, so if you were paying $1000/acre you could be getting $50/acre, but paying $2500/acre, no ones going to give you that five per cent as a lease.

"It's worked for us given the timing of it all, we were lucky that we made the moves when we did."

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