It’s been a hard summer for many farmers, and as we look towards the year ahead, Figured catches up with Alastair Johnston, Principal Farming Consultant at Promar International, and new Figured Customer Success Specialist, Sam Seymour. Alastair advises a range of dairy and arable farming clients and Sam’s family farms 250 beef cattle, 500 sheep, as well as an arable enterprise in North Yorkshire.
We spoke to Alastair and Sam to find out how the harvest went and what farmers can do to prepare for next season, by utilising up-to-date budgeting and working closely with farm advisors.
UK harvest 2022 observations
In terms of arable harvest, for Alastair, this generally went well. "Conditions allowed for an exceptionally early harvest and yields have been good. However, the challenge was ensuring that moistures were not to low, especially in the oilseed rape and some cereals." For Sam it was a similar picture: "Harvest was fantastic on the arable side, with good yields and good quality with very little drying. Our machinery actually ran better and more efficiently in the dry conditions."
Unfortunately escaping machinery problems wasn’t the case for many other farmers, particularly in southern UK counties. The combination of no rain and record temperatures saw many on fire watch - with combine harvester fires leading to a loss of machinery and crops. Alastair says: "A big challenge this year has been preventing machinery and field fires due to exceptionally hot weather. This caused foliage to dry out as the soil approached its permanent wilting point."
For livestock, the dry weather has also hampered the yields of forage crops, resulting in farmers being left with no choice but to start supplementary feeding with feedstocks usually reserved for winter months. Alastair highlighted the difficulties for those growing forage. "Since June, moisture has been in short supply and there’s been very little in the way for 3rd or 4th silage cuts. In some cases, maize harvest took place in August; which is unseasonably early. This was to ensure some eating quality in the maize, but also to establish fast growing grasses or cover crops to increase the forage amounts available between autumn and spring."
The market outlook
The production impacts of summer also come amid the backdrop of extreme market volatility, partly due to the Ukranian port blockade, and western sanctions on Russia - both resulting in the increase of commodity and input prices.
Sam says: "The biggest effect for us has been the increase in costs. With costs rising so much, the biggest worry is what to do next year. The cost increases of fuel, feed, and fertiliser have given farmers headaches over how to manage the next year."
Managing the farm outputs has also been difficult. Sam explains: "Working out how to sell grain has been a challenge, with the price being so volatile.’ Whilst Alastair points out ‘the key is knowing your cost of production and your break even point, budgeting and a realistic gross margin target is the only viable method to plan especially with the reduction and removal of direct support payments."
The need for real-time farm budgeting
These challenges present the need for up-to-date budgeting for both livestock and arable farming systems. As Alastair highlights: "With regard to forage and grassland production, it appears that having an 18 month forage window and producing sufficient forage is increasingly important; managing grass to take earlier cuts and ensuring there is stock in the clamps before the previous season’s stock has run out. Therefore planning and budgeting is key to help farmers calculate annual required forage, and assessing if levels of production can be maintained at current levels stocking; and if they can’t, what needs to change."
For arable crops, Alastair says: "Farmers are already focused on harvest 2023 as crops and green covers are being sown. Forward selling is a useful tool as it sets a bottom price for the product, however the key is to budget the inputs and costs to that price. These forward plans need to consist of options, such as: can we farm with lower purchased nitrogen and chemical usage, as well as the reduction in BPS?’"