Partnership aims to boost crop profitability

A new initiative aims to help farmers boost profitability from combinable crops.

Partnership for Profit, from Syngenta, seeks to provide growers with a greater insight into the relationship between crop management and margins.

In particular, it will highlight the way changes in input use and agronomy impa ct on profitability, said Mark Hall, the firm’s business analyst. During 2010, the initiative will focus primarily on helping growers mitigate the risk factors posed by continued tight grain prices, said Mr Hall.

Margins for combinable crops look like they will increase over 2009 due to lower fertiliser costs, acknowledged Mr Hall. But he added: The amount of money which needs to be invested per hectare to achieve these margins will be higher than it was a few years ago.”

Since 2006, arable farm operating costs have increased by around 26%. Based on an average feed wheat price of £75/t, farmers would have needed to achieve around 10t/ha to break even in 2006.

At an estimated 2010 feed wheat price of £100/t, this season’s breakeven yield will be similar. But the higher costs versus 2006 mean there are extra risks involved in achieving that yield and these risks will need to be managed.

“To put this into perspective, £80/t spent on growing feed wheat in 2006 translates into £105/t in 2010,” said Mr Hall. “So producing high yields will be crucial, but so too will be protecting business returns against these higher risks.”

There are two types of risk where margin could be lost. The first is on low yield potential sites where there’s a risk that costs spent on the crop could exceed potential returns. The second is where yields fail to reach their potential.

“In order to help protect against the first risk of costs exceeding returns, growers should look for efficiency gains,” said Mr Hall. These included using products that offered best value for money.

Tailoring dose rates to individual situations and combining the correct nozzle choice with low water rates were especially important. So too was tank mixing products where possible to minimise the number of spray passes while maintaining crop safety.

“To help protect against risk of yields failing to live up to potential, the first step is to achieve excellent crop establishment. However, as establishment has already happened for winter crops, growers need to ensure products are used at the right time and right rate.”

Future years will see the Partnership for Profit examine the more positive aspects of improving profitability, such as use of precision farming. It will also investigate the application of advanced science such as sensor technology to provide early warnings of disease.