Sheep and grain producers tackle tough conditions

30 May 2025

As dry conditions continue in South Australia, a father and son-run merino and cereal cropping business is using its RIC loan to manage rising operating costs and plan for the future. 

James and Lesley Sander, and their son Luke, own a 1660-hectare property in Eudunda, located in the Mid North region, which was established by James’ grandfather in 1922.

They run 2500 self-replacing Merinos and grow cereals and vetch, with a yield of 1.5-2.5 tonnes a hectare on average, although they have seen several years of dry conditions.

“At the end of last year, the forecasts were saying it was going to be a wet summer with an early break but it couldn’t have been a drier summer,” James said.

“I’m 67 and I’ve never seen it that bad, or seen it so dry for so long.” 

James always wanted to be a farmer and has doubled the operation since he took over.

He said growing up on the land had enabled him to responsibly manage the property, which typically experiences lower rainfall, by managing sheep numbers and planting crops when conditions are right.

“You have to be conservative because you know every year isn’t going to be a good year and when you’ve had a bit more experience like I have, you know what it’s all about,” he said.

With unforeseen dry conditions leading to crop failures three seasons in a row from 2017-2019, the business applied for a RIC Drought Loan in 2020 with the help of a rural business adviser.

Low-interest RIC finance helped manage the costs of an additional property purchase.
 

“When there’s a shower, that block will get slightly higher rainfall,” James said.

“It was a really good opportunity and because my son was coming back home to work on the farm, it was perfect timing – it’s now the most productive part of our farm.”

RIC’s 5-year interest-only terms and concessional interest rate, together with lower feed prices and good stock prices helped them manage through, resulting in a good harvest in 2022.

But as dry conditions returned in 2023 and 2024, livestock prices fell and feed prices rose.

Then with just 20mm of rain falling since November 2024, the Sanders needed additional funds to continue so they applied for a second RIC Drought Loan.

“Interest rates have gone up and that knocks you around,” James said.

“Everything is starting to cost more – the price of hay is dearer.

“We’ve spent substantial money just on fodder and freight – we’ve tried to keep our numbers up for when it does come good.”

Customers may hold more than one RIC loan to the limit of $2 million provided half of their total debt remains with a commercial lender at the time the loan settles.

The Sanders had enough equity in their property to meet the security requirements for a second RIC loan, which was matched by their bank. They were also able to demonstrate the ongoing ability to service their loans.

It will help the business continue to feed the flock, add containment pens to hold sheep in condition, buy fertiliser and plant the next crop of wheat, barley and oats once rain falls.

“It’s so dry, there is no moisture in the soil whatsoever. We need reasonable opening rain,” James said.

With the extra breathing space created by the RIC loan, James hopes once he manages through the current dry period, he will be able to reduce debt and leave a sustainable business for Luke.

“We just want to be a bit more comfortable and not have as much debt,” he said.

“We’re really happy with RIC, just the lower interest rate – it really helps us.

“I would definitely recommend RIC.” 

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