Rural Life - Water the new gold in Central Otago

Irrigation New Zealand held its conference in Alexandra last week. Agribusiness reporter Sally Rae joined a media tour in Central Otago to see  the benefits of water.

It gives John Perriam such a buzz to see "rabbit s...  being turned into world-class pinot".

But to do that on Bendigo Station, in the heart of Central Otago, it has taken technology, resources and water.

Bendigo —between Tarras and Cromwell — is a very different place to when the Perriam family first arrived in the late 1970s, having been literally flooded out of their previous property by  the Clyde Dam hydro development.

They took over 6000 superfine merino sheep from the previous owners, the Lucas family, and fine and superfine merinos remained a core part of the operation.

But the property has also had  a lot of  diversification and development, with water being the cornerstone for the changes. As Mr Perriam surveyed the latest development — Clearview Lake — he described it as probably the most futuristic in New Zealand, with the pivot irrigator sitting in the middle of the lake and three causeways to maximise coverage.

As well as the aesthetics of the lake, its main purpose was for on-farm storage for the latest development, with about 270ha earmarked for viticulture and horticulture, particularly cherries.

When the Perriams took over Bendigo, it was a large tract of pastoral lease land. Through tenure review, the family traded the kanuka bush-covered historic area on the property  for freeholding  the mid-altitude and lower land.

There had later been criticism they had been "handed a gift", but, in reality, the terrace country was a "serious, serious liability" as there was a huge rabbit issue, Mr Perriam said.

That rabbit-riddled landscape was later transformed through vineyard developments and what was really "just a liability and pretty much one massive rabbit warren" in the early days was now becoming quite famous, he said.

Quartz Reef winemaker Rudi Bauer, who first approached the Perriams about growing grapes in the area in 1991, had been the "flagship" for what had happened in the wine industry at Bendigo.

About $70 million had now been spent on what was previously a serious rabbit liability and there was a mixture of both big and small interests involved, Mr Perriam said.

He believed many people did not understand, particularly at government level at present, that the farming community was so fortunate to be on the banks of one of the best water resources in the country. Many farmers in New Zealand did not have that ability and  needed help. Several years ago, pivot irrigators were installed on Bendigo, replacing the much less efficient border dyke system. Now 425ha of  pastoral land is irrigated  and Bendigo finishes between 700 and 1000 head of Angus steers and heifers, predominantly on fodder beet.

Had it not been for irrigation this past dry summer, then "you would have seen a lizard at 1000 yards", Mr Perriam quipped.

He was very proud of all the interests that were now represented at Bendigo Station and very proud to have had the opportunity to be  custodians of the land.

"We’re going to leave something far greater than when we arrived."

At Mt Difficulty Wines at Bannockburn, James Dicey describes water as "the key to unlocking the land".

It was a very dry climate but the area was blessed with a vast water resource which unlocked vast economic potential, he said.

When the Dicey family turned up in 1990, there were no grapes there, just "scraggly merinos and rabbits".

"This landscape has been absolutely transformed by water, in my humble opinion for the positive," Mr Dicey said.

That translated to a significant increase in land values — in the early 1990s, the going rate  was about $10,000 per hectare for irrigated land. Recently, " a bit of dirt" was sold for $250,000/ha.

Irrigation at Mt Difficulty was a "positive story"; the grape industry was not trying to grow dry matter or volume, it was all about quality, Mr Dicey said.

And for Mt Difficulty to produce  quality wine, it only needed enough water to get the grapes ripe, using drip irrigation. Any more and the wines tended to become flabby, boring and uninteresting, he said.

So it was not in their interests to over-irrigate and they also tried to avoid water for frost-fighting unless they really needed to.

Mr Dicey was "awaiting with bated breath" the potential implications of farm environment management plans and how they might be applied locally. 

It was "yet another layer of bureaucracy" farmers would have to comply with.If they did not have water, they would not be doing what they were doing at the moment and they worked with their environment rather than trying to work against it.

"Water is the new gold, if we haven’t already realised that in Central Otago," he said.

It should be recognised as a resource with a lot of facets of use; irrigation was just one of them.

He was concerned with the change and attitudes to farming where it was seen as a negative. It provided the backbone of New Zealand’s economy, as  long as it was done with appropriate limits and without ridiculous amounts of compliance and bureaucracy.

The "pendulum" needed to settle in a balanced way that ensured the environment got what it needed, but there was balance.

Mr Dicey believed there was a lack of honesty about how much pollution occurred in the urban environment.

While any abuse in the rural environment was very visible, it was very easy to gloss over the urban environment and actions were required there as well. If not, it led to an inequity of how water rules were applied between the two environments, he said.

Innovation has been a focus at Mt Difficulty, which invested $250,000 in a bioreactor plant to deal with winery waste, taking wastewater to just above drinking standards, with the subsequent material being used for  native plant regeneration.

Waste material was also mixed with cow manure, apples and cherries and then put  through a composting and worm farm process to create worm castings which was "black gold" — "phenomenal" for the soil and a repository for water and nutrients. Mt Difficulty, an award-winning business, was in the throes of being sold to listed company Foley Family Wines.

At Matakanui Station, near Omakau, Andrew Paterson is the third generation of his family to run and own the 8700ha property, with his wife Tracy.

This year, they will winter about 23,000 stock units made up of fine-wool sheep and Hereford cattle.

The countryside has been transformed in recent months following a dry spell which left them with just one pivot running, their dams going dry, and running out of house water just before  the rain came.  They had also been planning to buy  grain to get ewes ready for mating.

The Patersons have 430ha under irrigation, using pivots and spray guns.  Changing  from flood irrigation to spray watering  was also so much more efficient, as they could irrigate four times the area  with the same amount of water.

Irrigation had added another three or four thousand stock units to Matakanui’s operation and  had also given them the ability to fatten their stock.

It meant more staff, although the type of staff had changed; they needed to be more machinery-oriented, and there was more break-feeding work.

"The days of high country shepherds running around the hills with hill sticks are over," Mr Paterson said.

Their biggest water storage at the moment lay in the snow, but they intended to put in storage.

With deemed permits, it was concerning it was not guaranteed that water would be  there in  future, so if it could be stored, then he would feel more comfortable about having a minimum flow.

The biggest challenge was having the money to spend. If he wanted to complete the irrigation development on Matakanui, then dairying was one of the ways he could afford to pay for it, but he was "trying not to do that".

Mr Paterson disagreed with some people’s idea that intensification of farming was bad. Piling dairy cows on to a fodder beet break and churning it up was not sensible, but putting 1000 sheep on a pivot break with good grass was not a big problem — it was good farming practice.

He did not believe intensification should be ruled out, particularly as some of the best food-producing areas were being lost around cities and towns to  urban sprawl, and intensification was needed to counter that. But it was possible to balance that with looking after the environment.

He was frustrated by the amount of focus on what farmers were "supposedly doing". There was a lot of emotion and not a lot of evidence as to the "bad" things that were  going on, he said.

Mr Paterson said he carried out his own water testing on his property and encouraged others to do the same, saying they could resolve any issues  they  found.

If everyone looked at themselves and their own set-up, then he believed it could be "sorted".