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David Anderson - Planning for the future and improving capital value through tree removal
1. Planning for the future and improving capital value through tree removal
Prepared by: David Anderson
Rosebank Farm
October 2014
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Rosebank Farm – Our story
• We have a lifestyle property, purchased in 2003 for our
retirement
• Spent last 10+ years seeking to improve productivity
• Need to plan for future sale
• Property improvement project
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An overview of what we purchased
• Purchased with 2,777 trees (now > 26 years old)
• Total orchard area 7.2 hectares
• 7m x 3.5m spacing (closed canopy)
• Steepish blocks creating significant water wash (soil erosion)
• Largely krasnozem soil
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5. 2014 AMS 40th Anniversary Industry Conference proudly presented by
Our challenges to date
• Improve and maintain soil/tree health
• Design and implement water management plan
• Ongoing pest management
• Quality improvement
• Complete top-working trial
• Trial different canopy management techniques
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Our results to date
• Fully paid for drying shed investment through improved NIS
quality
• Consistently achieved > 3.5 tonnes per hectare
0.00
1.75
3.50
5.25
7.00
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
NIS tonnes/ha
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The issues we need to resolve
• Deteriorating canopy volume (reduced production)
• Ongoing soil erosion
• How to maintain productivity in an ageing orchard
• How best to sell the farm within 10 years
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Our 10 year objectives
• Maintain/increase productivity
• Reduce soil erosion
• Reduce costs
• Sell farm by 2021
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The steps towards achieving our plan
• Create cash flow to determine economic viability of tree
removal
• Determine ability to cash flow the transition
• Commence program to remove every other row over 5 year
period
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Cash flow - income
• Calculate NIS production by block
• Estimate kg/tree by block for each year
• Increment kg/tree by 20% p.a. over 5 years to minimum 80%
of original yield after each row is removed
• Assume conservative $/kg NIS price
• Calculate NIS revenue p.a.
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Cash flow - expenditure
• Calculate all estimated costs, by category, p.a.
• Adjust chemical, fuel and oil, and labour costs as program
proceeds
• Adjust fertiliser costs (per tree) as canopy volume increases
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Cash flow – outcomes
• Will vary - need to be conservative
• Cash flow will deteriorate during the tree removal phase but
will continually improve as the orchard recovers
• We have planned for this to take five years for each block
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Our tree removal program
• S & G Agricultural Contractors (Simon Richens)
• Apply ethephon at appropriate time to enable early nut drop
and early harvest completion in selected blocks
• Book contractor as early as possible after final harvest pickup
• Second mulch to reduce high incidence of large debris
• Re-shape inter-rows if necessary
• Apply kaolin clay product (eg. SurroundTM) - sunburn
• Plant smothergrass and establish inter-row groundcover
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Mulcher
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Prior to tree removal
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Post tree removal
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Prior to tree removal
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Post tree removal
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What we’ve learnt
• Be courageous
• Plan, but be prepared to modify along the way
• Breakdown and spread mulch prior to next harvest
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The planned outcome by 2021
• > 1,300 trees
• > 5 tonnes per hectare
• Costs reduced by about 35%
• A great looking and saleable property!
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Any questions?
We’re happy for you to make contact later:
David or Ann Anderson
Rosebank Farm
Telephone: 02 66882280
Email: rosebank-farm@bigpond.com