As the next growing season gets under way I feel I need a check on my sanity. You might like to consider your own at the same time.
Let me explain. Compared with many arable farmers, we were lucky to finish harvest in reasonable time. Then it turned very wet, delaying oilseed rape drilling. When it should have been put in, in late August, we were still combining those fields. Once they were cleared the land was too wet to carry a tractor until almost the middle of September.
When the sun came out we got on with min-till drilling as quickly as possible, but the topsoil turned crusty and for days the tiny seeds sat in that hard, dry layer reluctant to emerge for lack of moisture. I never thought I’d write that line this summer.
Late drilling, therefore, led to even later establishment and that unfortunate combination is already making below average yields likely for next year’s harvest.
Last week we started planting winter wheat following last year’s rape. Having cultivated the rape stubbles soon after combining we drilled straight into that tilth. You couldn’t do it much cheaper and most of the wheat went in well.
The trouble is, all subsequent inputs will cost much more this year than last. Like many others, we have a barn full of nitrogen for top dressing next spring bought at well over twice the price of the previous year.
Diesel fuel, which looked like getting a bit cheaper a few weeks ago, will probably follow the latest hike in the price of crude oil and since it rules the cost of almost every other input we must expect more general increases.
Meanwhile the value of wheat (and almost everything else we grow) is being dragged down by poor quality samples from rain-damaged crops. Distressed sales of sprouted and undried grain are being made at well under £100/t ex-farm, less deductions. Good samples of dry, earlier harvested stuff aren’t valued on their own merits, but at a premium above salvage of £18-20/t.
All of which will erode or eliminate margins on grain not pre-sold during the pre-harvest period of perceived shortage. That shortage has disappeared for the time being as exporting countries have revealed the production of extra acres, planted to cash in on anticipated higher prices. Suddenly there is sufficient on the market.
That, in turn, is pulling down futures prices for harvest 2009 and beyond. Delivered prices for November 2009 are struggling to stay above £120/t, which implies an ex-farm value of about £110. But we know, because the inputs have been bought, that the break-even cost of growing wheat is at least £130/t, depending on yield.
Which means if values don’t fall further and we manage to grow decent crops we stand to lose about £80/acre (£200/ha). So, why am I drilling as if nothing had happened? I say again – I need a sanity check. Am I mad? Are you?
More from David online
- This must be one of the worst years ever for slugs, which is hardly a surprise after all the rain. It makes the noises coming from water companies about Metaldehyde contamination from slug pellets all the more worrying. Apparently, they are having trouble getting it out of water supplies and are calling for a ban on its use. Goodness knows where that would leave us if it happened. But I understand there is growing evidence that most of the contamination is occurring in gardens and urban situations rather than farms. As often happens, amateurs mess it up for professionals. But it does reinforce the vital need for responsible use of the pellets on farms.
- Read David Richardson’s blog