Take a more precise approach to production costs A focus on sustainability of farm businesses was the theme of the Hutchinsons’ conference.
With UK agriculture facing some of the greatest uncertainty in recent history, arable farmers must get a tighter grip on production costs and crop agronomy in order to remain profitable post-Brexit. That was one of the key messages from the recent Hutchinsons technical conference in Peterborough, where speakers urged less focus on the big economic challenges largely beyond farmers’ control and more on improving the resilience of businesses to a volatile and competitive future outside Europe.
Doing so required a clearer understanding of true production costs and more precise agronomy to manage the yield variation on all farms, the 350 delegates heard. Gross margin analysis only accounted for less than half of total growing costs, so all “fixed” costs should be included when assessing cost of production, Hutchinsons precision technology manager Oliver Wood said. This includes operational costs, such as labour and machinery. Figures presented by Sebastian Graff-Baker of Andersons put total costs for growing a crop of wheat in 2017 at £1,012/ha, comprising £472/ha of variable costs (seed, fertiliser and sprays) and £540/ ha labour and machinery. At a wheat price of around £130/t, that equated to a breakeven yield of 7.8t/ha, but including rent pushed total costs to £1,357/ha and the yield to 10.4t/ha, he said. Combining such financial information with yield map analysis
for individual fields and farms often revealed a “mosaic of profit and loss”. “If we want to raise farm profitability and become more sustainable then we need to look at what’s causing this yield variation and find ways to address it,” he added. The Hutchinsons’ Omnia precision farming system, which combines financial benchmarking with multi-layered crop agronomy analysis, provided an ideal way of identifying and addressing in-field variability, suggested Mr Wood. “We need to improve productivity, but it cannot happen at any cost,” he stressed.
Start with the soil Soil health was widely recognised as being the starting point for managing inconsistencies across fields and various speakers highlighted practical advice for growers, which included: • Get to know your soil and how different components interact – consider chemical, biological and textural components, organic matter, nutrient
content, pH, etc. Basic soil tests offer limited information, so consider a detailed Healthy Soils assessment on representative fields, combined with regular soil testing and visual inspections Examine soils for structural issues (eg compaction) – ensure it is done when soils are moist enough (typically October to April) Earthworms play a key role in improving soil health, so do all you can to maximise numbers, through increasing organic matter, reducing tillage intensity and rotational changes Assess earthworm numbers by digging test pits of 20x20x20cm with a fork, laying soil out and identifying worms by hand. Ideally take 20 samples in a ‘W’ shape for fields up to 35ha Worm populations of >16 per soil pit (>400/m2) are beneficial to productivity Cover crops can help address soil issues, but only if they are carefully targeted to individual situations. ■
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Farmers Guide Magazine January 2018 Issue