SURVIVING HARD TIMES WITH SPECIALISATION…
SURVIVING HARD TIMES WITH SPECIALISATION…
Low farm incomes, and
producers doing their own
work, has put a hold on
contract rates and service
expansion in East Anglia,
says R & J Self Contractors.
Andy Moore reports
OFFERING specialist, rather than a range services, is the key to successful contracting in the current agricultural economy, believes East Anglian contractor Robert Self.
A dedicated sugar beet and maize drilling/harvesting contractor, Mr Self has evaluated the potential for offering other services but discovered that such work has been swamped by DIY producers and competition from other contractors.
"Hard times in agriculture have given contractors the idea that small to medium sized growers cannot afford the running costs of cultivation kit or combines so there may be more work about," says Mr Self. "On the contrary, growers in our area are trying to do more work amongst themselves by pooling machinery or hiring in a combine for the season."
Based at Creeting St Mary, Suffolk, Mr Self reports even large farms are now amalgamating to pool their machinery resources.
"These amalgamations can work for and against the contractor," he explains. "The contractor could gain extra work or, if there is sufficient machinery, lose out all together."
This year may see Mr Self updating his existing straw baling operation by replacing one of the two Krone Big Pack 80×80 medium square balers with a large Hesston 4900 machine.
"The medium size bale is popular amongst the high number of pig producers in our region, but demand is dropping off due to the state of the pig industry," he says. "Last year, we hired in a Hesston baler with a man and tractor on a trial basis for part of the season. The baler produced about 1500 bales for two customers, but for us to purchase such a machine, it would need to produce at least 7000 bales a season to pay for itself."
Mr Self says he may decide to hire in the baler again, but supply his own tractor and labour to help offset the hire costs.
Bale handling
On the bale handling front, the past three seasons has seen success with an Arcusin bale collector/stacker machine.
"Because we are able to collect, carry and stack bales with just one man and machine, the whole operation can be performed significantly cheaper than the cost the customer can do it for," claims Mr Self. "Working with a John Deere 6910 tractor fitted with 40kph transmission, the Arcusin can handle up to 1000 Krone bales a day."
Contract rates for baling and bale handling last year, he says, were unchanged and are likely to stay the same this season. "But these rates cannot stay the same forever, and sooner or later they will be increased to maintain our own margins and keep up machinery reinvestment."
One contract rate which Mr Self would like to increase is his grass and maize foraging service, an operation which includes a John Deere 6910 self-propelled forager, plus haulage and clamp machinery.
"The grass and maize foraging service represents a high machinery and labour outlay and we need to keep rates at a reasonable level," explains Mr Self. "The self propelled forager has nearly done about 3000 hours over four seasons and will have to be traded in next year."
Another machine to be given the chop is the firms six year old Riecam sugar beet harvester which might be replaced this season. Options for a new machine will include harvesters with low ground pressure.
New machine
Used in partnership with a three year old Vervaet harvester, the new machine will help lift some 1000ha (2500 acres) of beet over the season, achieving 8ha/day (20 acres) average workrates.
Harvesting high-yielding beet crops, which can be up to 86t/ha (35t/acre), are claimed not to reduce workrates, but increase running and depreciation costs. These are due to the extra throughput and the need for more tractor and trailers. Mr Self believes extra running and depreciation costs could be offset by charging by the tonne instead of the acre.
Three years ago, beet lifting rates were increased from £60 to £70/acre to compensate for a reduction in lifting area so the firm could offer its core customers an improved service and a more accurate lifting date.
"The new system has proved to be a great success over the three years and about 90% of our customers believe the charge rates are set at the correct level," he says. "The remainder may grumble and threaten to go next door to lower prices, but ultimately, I believe they place a higher value on reliability." *
The three-year-old Vervaet six row beet harvester may be joined this season with a similar size machine to help lift some 1012ha (2500 acres) of beet.
Below: East Anglian contractor Robert Self says increasing contract rates is becoming more difficult as farm incomes remain low. Some rates have stayed the same for the past three years.
SELFBUSINESSDATA
Base: Grange Farm, All Saints Road, Creeting St Mary, Ipswich (01449-722711).
Work undertaken: Sugar beet Drilling and harvesting, maize drilling and harvesting, grass silaging, medium density straw baling, rape swathing, whole crop silaging.
Machinery fleet: Four John Deere tractors (110-170hp), 410hp JD self-propelled forager 6910, Two Krone Big Pack 80×80 balers, two self-propelled beet harvesters, Shelbourne Reynolds Mentor rape swather, Arcusin bale stacker, 5m Kuhn Alterna 500 trailed mower, plus associated tackle.
Labour:Two full-time staff and up to 12 casuals at peak times.