The growth, adoption, productivity and profitability (GAPP) project, which is a joint initiative between BCG and DEDJTR, entered its second year of young (and young at heart) farmer discussion groups this week.
The aim of the GAPP project is to increase production and profitability on farms through new practices and technologies which are learnt through bringing young farmers together and discussing business and agronomic management issues.
The meetings, which were held from Tuesday to Thursday at Horsham, Rupanyup, Hopetoun, Southern Mallee (Birchip) and Manangatang featured guest speaker Ed Hunt (Ed Hunt Consulting).
Ed is a farmer on the eastern Eyre Peninsula as well as running his own consulting business which focuses on farm business management and benchmarking.
At this round of meetings, Ed presented some excellent information on managing risk and profitability which included key messages such as:
- Each farm has a different risk position based on soil types, enterprise mix, management, input variation, off-farm income and current debt.
- Equity and average whole farm budgets do not indicate the risk of the farm operation.
- Farming today is higher risk than it was even 10 years ago.
- Financial strength is the greatest buffer against this increased risk.
- Continuous cropping in low rainfall areas has the ability to make money quickly but can lose it just as quickly. In high rainfall areas, equity drops a lot slower, however it takes a long time also to recover from debt.
- Take more responsibility for decision making on your farm. Challenge and understand every input on your farm. Be the decision maker.
- Good farm businesses have a manager that is progressive and intuitive and knows when to take a risk and when not to take a risk.
- A 60-70% cropping program is very profitable. A 100% cropping program profit doesn’t increase a lot, but costs increase dramatically.
- Adding livestock to your farm business can reduce risk.
- 100% cropping can make the most money in a Decile 9, but also lose the most in a Decile 1.
- Complete budgets/cashflows for different Decile years, and to also break even.
- All farms are profitable with their right risk position.
For each of the five GAPP groups, two farmers had a Yield Prophet® paddock each which were used as working examples throughout the year to assess yield potential and inputs to gain a greater understanding of cost of production.
Using these nitrogen and moisture results, the groups had a soil interpretation workshop, working through soil test results and interpretation and calculating plant available water, total nitrogen and fertiliser requirements. At this round of meetings the groups reviewed their Yield Prophet® paddocks and assessed their input decision making.
BCG will be launching two new GAPP groups in 2016, one in the Quambatook region and one in the West Wimmera (Nhill locality). These groups are open to everyone and BCG welcomes anyone interested in joining one of the groups to express interest to BCG by phoning the office on 03 5492 2787.
