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MOST PROFITABLE GROWERS MAINTAIN INPUT LEVELS
Date added: 15/02/06 |
The arable producers with the highest margins in the UK are clearly those that concentrate on reducing costs/tonne and maximising yields rather than simply cutting back on inputs, according to new figures from ProCam’s 4cast agronomy system.
“There is clear evidence that cutting back on inputs without evaluating the effect on yield and margins is the wrong approach to deal with the greater financial pressure resulting from current prices and the loss of arable aid,” says ProCam technical director Dr. David Ellerton.
Growers who spent a lot of money on herbicides in Autumn 2005 and who may be planning to cut down on fungicides this Spring to compensate, could potentially be making a very expensive move, he says.
“The new 4cast figures clearly show that the most efficient producers are those that use inputs correctly and actually target higher yields - reducing costs/tonne rather than costs/ha. With the prospect of higher grain prices, this is now even more important than last season.
“If you look at variable spray costs/ha of production of the top 25% of producers in 2005 there is very little difference between them and the average - £145/ha average spend as opposed to £135/ha for the top 25%.
When you realise these growers are achieving gross margins nearly £160 more than the average - £492/ha compared with an average £335/ha - it is obvious they are not achieving their advantage by reducing spray inputs per se, David Ellerton says.
“If you look at their costs/tonne they actually reduce their variable spray costs/tonne, £14.49/tonne compared with £17.25/tonne, and achieve higher yields - often up to 2 tonnes/ha through better agronomy. In effect, what they are doing is working with their agronomists to use inputs more wisely.”
Over the last three years ProCam’s top 25% of producers have increased their gross margin advantage over average producers from £96/ha to £157/ha – an increase of almost 65%.
4cast shows the better producers are targeting triazole and strob. applications, spraying more frequently with no more than 4 weeks between applications and applying protectant chemicals early in the season to reduce disease pressure on strobs and triazoles. |
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