Quarrying & Mining Magazine

Story of a smaller player

The dairy boom got Southland’s Hillside Quarry up and running, and the current slump may yet slow it down. HUGH DE LACY checks out a small player in the aggregates market.

Mataura Island isn’t one – at least not any more – but the Southland locality boasts a quarry that has turned a farmer-by-trade into an aggregates supplier who’s done well out of the dairy boom in the deep south.

Dairy-farmer David McKenzie launched his Hillside Quarry on the eastern side of Mataura Island, about equidistant from Wyndham and Edendale, nearly 20 years ago, and it’s ended up supplanting the farm as his principal business interest.

Mataura Island hasn’t been an island since 1878 when the Mataura River used to flow further to the east than it does now, and a farmer called Thomas Ayson scoured out a new bed in Stewarts Creek to take some of the Mataura’s flow to his land, thereby making an island of the land in between.

The river promptly responded by staging a flood – one of all too many – that carved a new main path for itself down the creek bed, leaving its old watercourse dry, and the district still called an island even though it was no longer one.

McKenzie grew up on the farm next to his present 350-hectare property which today supports a 400-cow dairy farm run by a sharemilker, as well as the quarry on a subdivided four-hectare block.

McKenzie had started out as a sharemilker himself, and bought the present farm from the proceeds in 1976.

It was good limestone country but one corner of it featured a rocky outcrop on which grass refused to grow.

He’d been farming the land for some time when a mate of his from around the corner, Jack Cameron of Cameron Contracting at Woodlands, asked if he could buy a bit of the metal out of the rocky outcrop for a roading job he was doing nearby at the time.

A few loads later and McKenzie realised he had the beginnings of an alternative revenue source in the rock, so set about formalising it.

He paid a visit to the Southland District Council, as it was then, and asked what it would take to get a quarrying resource consent on his land.

The staff gave him a brief lowdown of the information required, and soon afterwards McKenzie was back with all that he thought was needed written down on a single foolscap sheet of paper, and with the expectation of walking out with the consent in his back pocket.

When the bureaucrats had stopped laughing, they outlined in greater detail what was required, and McKenzie retired to the drawing board.

He spent the next six months going through each step by himself and got a lawyer to translate it all into legalese, but on his return to the council was startled to recognise a local contractor also bent on getting a resource consent heading into the fray with three lawyers down from Wellington for the occasion.

McKenzie must have done his homework though, because in the end he got his consent without having to make any further representation, and six months later it showed up in the mail from Christchurch.

By the end of 1994 he was in the quarrying business.

“The resource is brown limestone rock and we’d realised its potential by using it ourselves for tracks and gateways round the farm,” McKenzie told Q&M.

The initial resource consent was for just 15,000m3 a year, but over the ensuing 18 years it has been upgraded twice in response to demand, and output now is in the region of 36,000–38,000m3 a year, most it going into dairy conversions, but some also being used as roading basecourse.

To get under way, McKenzie bought himself a six-tonne digger and taught himself to drive it – not very well as it turned out: the little machine was taking 36 bucketfuls to load a truck and trailer, and one day as he went to swing the boom around with another bite of aggregate, it stayed where it was, having snapped halfway along its length.

QM_P22_Feb_March_2015_1Even at that stage McKenzie realised his quarry had a future forming tracks on the myriad of former sheep and beef farms that were being converted annually to dairying, each requiring around 10,000m3 of gravel, so he thought he’d better acquire some better machinery.

This would have to include a crusher, because he’d exhausted the naturally crumbled metal in the pit.

He got in touch with Porter Hire and rented a Komatsu jaw-crusher off them long enough to crush 20,000 cubic metres, and when all that was sold he went back to Porters asking them to organise a purchase price.

“I also asked them to get me a decent digger, and I ended up buying a loader as well – all secondhand,” McKenzie says.

To that basic equipment he found the need to add truck scales after a couple of his contractor clients found themselves in strife with the gendarmerie over load weights.

When it became necessary to start blasting rock out of the quarry, McKenzie had it done by contract.

After a number of years running the business himself, David employed his son-in-law Clayton Olive to run the quarry and hired David Shedden as mechanic to service the machinery.

McKenzie has subsequently found himself sidelined from the business – “They reckon I’m too rough on the machinery” – and sent back onto the farm to run the dry stock plus a couple of hundred head of beef.

The business still uses the Hillside Gardens email address that McKenzie’s wife Eileen employed when the farm hosted a noted rhododendron nursery that for a while sold plants directly to the public.

Health issues and a change of lifestyle means Eileen no longer opens the gardens to the public.

The crash in milk prices this year has McKenzie suspecting an imminent slowdown in the rate of dairy conversions which have been the main market for Hillside Quarry over its nearly two decades of operation.

In the week when cooperative dairy giant Fonterra hacked its milkfat payout to $4.70 a kilogram from over $8 last year, McKenzie says, “the writing’s on the wall” for dairy conversions.

“It’s going to hurt, though it may not do so for probably another six months, but then we’ll feel the bite.”

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