FINE-TUNE FOR BEST MARGINS
FINE-TUNE FOR BEST MARGINS
By Matthew Ward and Charles Ireland
SEED, fertiliser and sprays are the basic variable inputs and Strutt & Parkers farm management experience suggests fine-tuning these can help optimise gross margins.
The total savings outlined below would amount to £55/ha. Over 100ha the total saving would be £5500. But such savings assume no loss in yield or quality.
Seed
Home-saved seed provides a big opportunity for cost saving, the difference between C2 certified seed and farm-saved seed amounting to £1960, or £19.60/ha, on 100ha of wheat.
That assumes certified seed cost £240/t, working out at £4320, or £43.20/ha.
By contrast home-saved seed cost £2360, or £23.60/ha. That is based on home-saved seed costing £175/t, including seed cleaning, treatment, royalty and the value of the grain, is used on 90ha and the final 10ha is drilled with C2 seed costing £240/t to provide seed for home-saving the following year.
But using the correct seed rate can offer a similar scale of cost saving. As a rule of thumb the following rates can be successfully used, rather than a blanket seed rate over the whole farm (see table).
Drilling too much seed will not only increase seed cost, but may also increase PGR costs and disease susceptibility. While yield may not be affected, quality may be, particularly if the crop lodges.
Fertiliser
Liquid fertiliser can be cheaper than solid if cheap sources of urea are mixed on farm.
But the real saving with liquids comes from reducing labour and machinery costs. It is crucial, however, that timeliness of application is not affected.
Among solid fertilisers urea can be cheaper per unit of N than ammonium nitrate. Each 1kg of nitrogen supplied as urea typically costs 31.52p, compared with 37.68p for AN. But the urea is bulkier and more difficult to spread over 24m.
Choosing between ammonium nitrate sources can also be worthwhile. AN from major manufacturers is the highest quality, but often the most expensive. So use it where other materials are unsuitable, such as where using a spinning disc spreader across 24m tramlines. But the key to making the most from fertiliser is the equipment used to spread it. Machines must be maintained regularly and calibrated correctly.
Tray tests are often available cheaply from training groups. But even on medium sized farms, the cost of trays is a small proportion of the cost of the fertiliser.
Rates of fertiliser are best calculated using MAFFs revised RB 209 booklet, alongside local experience. Growers may find that in some situations they currently underestimate the nitrogen requirements of their crops. Do not underestimate the value of previous cropping or FYM.
P&K fertiliser are often regularly spread on many farms without regard for soil status. Again RB209 gives excellent advice regarding P&K requirements for different crops at various soil indices. A more targeted approach can drastically cut unnecessary fertiliser use, in some cases by over 50%
Sprays
Independent agronomic advice means product choice is made on the basis of scientific data supporting the use of one product over another at appropriate doses to control the problem at hand.
Strutt & Parker experience suggests some farmers may be paying more than 15% extra for their crop protection by not using independent agronomists. That would allow farmers to buy products more cheaply through a buying group.
Electronic markets have become more common. But at the moment it seems the traditional market can react quickly enough to the initial savings that may appear.
Variable costs can be trimmed, but dont let cuts hit yields.
Target seed rates (seeds/sq m)
September October November
150 180 200 230 260 280 300 330 360 390
Go up 20-30 seeds/sq m a week, with adjustments of 20-30sq m depending on soil type and conditions.
Potential savings (£/ha)
C2 seed @ 180kg/ha 44 H/S +C2 seed @ 130 kg/ha 24
200kg N/ha as AN 105 150kg N/ha as Urea + 50kg N/ha 80
(50kg P205 + 50kg K20) as AN + 50kg TSP + 50kg MOP
as compound 50kg P205 as TSP + 50kg K20 as MOP
Service client 130 Independent spray 110
Agronomy – Agronomy 10
Total 279 224