Ex-SAF sharefarmer re-engaged at dairy farm now managed by agCap

Sharefarmer Mick Buckley on farm

agCap has recently re-appointed one of our leading ex Sustainable Agriculture Fund sharefarmers, Mick Buckley to a 580 cow dairy enterprise in Southwest Victoria. After farming in Tasmania for over ten years, Mick has adapted well to the operating environment in southwest Victoria.
In Micks words, “I am like a duck on a pond – outwardly it appears that I am swimming sedately across the pond, but underneath the surface my feet are paddling like crazy.”
The move to the mainland has been a rewarding challenge for Mick and his team.


agCap CEO, Wolfie Wagner measuring excellent pasture growth

On a farm visit in late June 2019, agCap CEO Wolfie Wagner and sharefarmer Mick measured pasture growth rates of up to 40kgDM/ha/day. Wolfie said that Mick has built a great feed wedge and has set the farm up well for the rest of winter. The current grazing interval is around 46 days, meaning that should the conditions deteriorate, Mick has room to move and could open up the rotation to avoid excessive pasture damage. Additionally, Mick was quick to calculate that his daily nitrogen use was 1kgN/ha/day; compared to many in the district that were using up to 1.5kgN/ha/day.

Mick and his partner own and operate VSF Operators Pty Ltd. The company has entered into a share farming agreement with the farm owner, facilitated by agCap, who bear the responsibility and accountability for managing the sharefarmer.
Under the proven agCap share farming model, the sharefarmer is responsible for all farm labour and provides their own farm motor bikes, vehicle and hand tools. The share farmer is paid on a fixed rate per kg of milk solids produced each month and receives bonus payments in relation to herd in calf rates and milk quality.

agCap is proud to be working with Mick and his company. “We look forward to a long working relationship” Wolfie said.

agCap completes SAF divestment, homes in on dairy

Australian agricultural investment manager agCap has completed the sale of its first Sustainable Agriculture Fund (SAF) portfolio, grossing more than $180 million for investors and paving the way for a second investment vehicle to focus on Australian dairy.

The sale of SAF’s Tasmanian livestock farms concludes the final tranche of a successful sale process, which combined with the Fund’s strong three-year returns (9% p.a. after fees and tax), is expected to deliver approximately $200 million back to investors over the life of the investment.

agCap CEO Martin Newnham said he’s extremely proud of what SAF has achieved over its life and the way in which the team handled its divestment.

“In less than ten months, we managed 100 property inspections and multiple complex negotiations, all the while overseeing 17 individual farm operations within the SAF portfolio,” Mr Newnham said.

“SAF’s success can be attributed to making sound acquisitions, developing the assets, our matured management model and divesting at the right time.

“Importantly, none of this would have been possible without the patience and support of our investors who backed the original investment thesis and supported agCap throughout the life of the fund.

“The sale of SAF presents a major milestone for them as agri-investing pioneers and for us as we now look to repeat its success with a strong focus on Australian dairy assets.

“The agCap Board and management team decided to exclude agCap as a potential buyer of SAF assets for ethical governance reasons and to ensure process transparency. The insights we gleaned from the sale process, however, certainly affirms our view that well-constructed investments in agriculture can provide institutional investors excellent risk adjusted returns.”

Mr Newnham says long-run cyclical and structural change in the Australian dairy industry is creating an opportunity for institutional investors and managers to partner on a compelling investment thesis.

“Australian dairy farmers are globally competitive, produce high quality safe products with high brand recognition in domestic and overseas markets,” he said.

“We are excited by the opportunities we see in dairy, and with the support of existing agCap shareholders, we are currently assessing suitable structures for potential investors, having commenced work on a pipeline of pasture based dairies in south west Victoria and Tasmania.”

agCap’s dairy investment program is expected to be available to institutional and sophisticated investors in early 2018.