Unfavourable weather has thrown farmers’ best laid plans aside this summer, so how do our featured farmers plan to get their businesses back on an even keel?
In our fifth article in a series looking at ’The cost of Production Challenge’ we look at how farmers are making decisions in reaction to changing conditions.
MICHAEL MUNCEY, HEAD OF CROP SCIENCE DIVISION
Decision-making is to the fore this month, with each of the growers considering not only the impact of the recent dry spell on this year’s crops, but also on next season’s cropping choices, management and marketing.
It highlights the need for flexibility to react to changing conditions. Making small changes to what you are planning can bring extra rewards through optimising performance, or minimising the impact of difficult circumstances.
Making those decisions, and knowing what impact they will have, is much easier if you are measuring key performance indicators. Whether that is the data Mr Savage is collating from his potato irrigation, or understanding how much feedstock Mr Gooderham needs to run the AD plant year-round, or simply knowing your costs of production to help make profitable grain marketing decisions, having access to that data, and knowing what to measure in the first place, is so crucial to effective decision-making.
Irrigation is the overriding consideration at R.S. Cockerill Farms right now, with unirrigated crops suffering from drought and future water abstraction licensing in the balance.
Oliver savage says: “The potatoes we are irrigating are looking fantastic, but where we’re not irrigating it’s serious. Cereals are dying rather than ripening – after the wet winter they’ve got shallow roots and yields are going to be down.”
Fortunately, Mr Savage is getting good data on crop responses to irrigation, with potatoes requiring a lot more water than expected.
“Most of our time and focus is on reviewing and adjusting water scheduling to maximise yield and quality at minimal water cost.”
With about 70% of the potato ground rented annually to spread the rotation, the farm uses rain guns as the most practical, cost effective irrigation option. However, with Government focus on promoting more efficient water utilisation, future investment is under the microscope.
“It’s a big investment – and loss of land – to build winterfilled lagoons,” he says. “The other alternative is to use more efficient trickle irrigation, but that’s also expensive and will limit rotation options. It’s a tricky decision we’ve got to make.”
Farm manager at J.P. Clay, Fawley Court, Fawley, Herefordshire
Mark Wood is busy reworking his budgets to take account of lower than anticipated yields this harvest, and is also looking ahead to minimise costs for the coming year.
“The crop potential just isn’t there anymore because of the drought,” he says. He sold a third of his wheat forward before harvest at an average of £140/ tonne ex-farm, which might now comprise half the crop.
“We won’t sell anything else now until it’s in the shed and tested.” Having placed his seed orders – when prices were somewhat lower – he is now considering his cultivation plan.
“Cracks will have done a good job so we will reduce deep cultivation on the heavy soils to save money, only working where it’s damaged from the wet winter or in tramlines,” explains Mr Wood. “If it stays dry we’ll also want to conserve moisture, but my worry is that when it does start raining it won’t know when to stop. We’ll then need to manage soils without smearing the top profile, which is something we did in 2012 and the crops really suffered.”
With three good contractors on-hand, cultivation choice can be made according to the conditions, to optimise crop potential and minimise cost.
Like many arable farmers, Jimmy Gooderham is worried about the impact the dry weather is having on his crops – but unlike most, it is feeding the anaerobic digestion plant which tops his concerns.
He says: “On the light land our maize leaves have curled up, and while we have a good carryover from last year’s maize harvest we cut back the acreage this season to try and find the right balance. The yield potential is reducing every day we go without rainfall, so we could be looking at shortages of feedstock this time next year.”
Run as a joint venture with his neighbour, the electricity powers a local feed mill, with any surplus fed into the National Grid. To try and reduce the cost of buying-in extra maize, Mr Gooderham is mulling over contingencies, including planting rye or barley to cut as wholecrop next June.
“We meet with the AD directors each month to discuss the options, so this month will be a pivotal meeting.”
Mr Gooderham is also planning the arable rotation for the coming year, and is opting for more disease-resistant wheat varieties to reduce the risk of crop losses.
Owner at Fletchers Farm, Fordham, Colchester, Essex
With combining under way and grain markets rising due to the drought across northern Europe, Tom Bradshaw’s thoughts are turning to 2019 cropping and sales.
“The rise in grain prices has got me looking carefully at forward sales – prices are better than they have been for the past five years so there are opportunities,” he says.
This year’s yields are likely to be below average, so higher prices will be needed to compensate for lower production. But assuming a return to average yields next year, there could be a chance to lock into a decent margin.
“We’re looking at about £160/t ex-farm for wheat in November 2019, and £175/t for malting barley – we haven’t sold anything yet but will do soon.”
Mr Bradshaw has no ‘typical’ marketing strategy; he assesses the markets and makes decisions based on his costs of production.
“We usually sell our spring barley on contract as it’s non-defaultable so there’s less risk. I’d never want to sell more than two-thirds of an average crop forward, and I look at how variable our yields are to protect against that fluctuation,” he adds. “Selling a third at this stage would be quite a large amount, but it’s worth considering.”