Buying farm machinery can be exciting, but considering the expense, it can also be confusing and potentially risky. When should you consider upgrading? Do you need to own your gear or are there alternatives? And what do you need to consider when you’ve decided to invest in new equipment?
The BCG Future Farmers Expo on 5 July will tackle these questions during a session on economic thresholds of owning, co-owning or contracting machinery.
Farm 360 consultant Simon Craig says “traditionally, return on investment has been the measure many use to determine machinery investment strategies, but this doesn’t take into consideration external factors, like harvest logistics, which are hard to quantify.”
Mr. Craig will present local examples and identify what should be considered when investigating different machinery investment options to ensure that the arrangement you choose is economical for your business.
“For a typical business, looking at the longer-term costs and benefits needs to be taken into account, bearing in mind the substantial investment,” says Mr. Craig.
If you are considering owning machinery, is it compatible with both the current and future size of your cropping program? Do you have the skills necessary to maintain the equipment, or access to expertise nearby? You may also need to consider complimentary investments such as additional on-farm storage or haulage to reduce logistic delays.
When investigating contracting or leasing as an alternative to ownership, consider availability, reliability and expense as delays in operations can be costly.
If considering sharing equipment with a neighbour, also known as machinery syndication, clear documentation needs to be in place regarding access, repairs and maintenance, fuel, operations, insurance and storage.
The BCG Future Farmers Expo will be held at Birchip P-12 School on 5 July from 11am to 5pm. Entry is free for BCG members and $50 for non-members. A tapas style dinner will follow the event from 6pm at the Birchip Hotel, tickets are $30 per person and can be purchased by phoning BCG on (03) 5492 2787 or visiting www.bcg.org.au.
This article was published in the Stock and Land, 29 June.
