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Co-operation can still pay
Feb 16, 2009 #474
Combining forces with neighbouring farmers can reduce production costs, but only if the business is well planned, Jamie Gwatkin, Benchmarking Consultant for the Joint Venture Farming Group told the organisation’s annual conference at Greetham Valley Golf Club, Rutland. Presenting results from the group’s members to an audience that contained a significant number of potential new ones, he urged them to take care when drawing up joint working agreements: “For instance, the price of red diesel rose from 36ppl to 52ppl in 2008, which demonstrates the necessity of installing a fuel escalator clause”. Reporting on the group’s figures for 2008, he said crop establishment costs rose by 30% from 2007 due to the poor autumn, whereas harvesting costs rose much less due to the better efficiency, while labour costs rose 13% - 15% because more people were employed for longer. Machinery costs rose between 15% and 30% due to increased fuel, spares and breakages during the difficult conditions. One area where costs were being cut successfully was oilseed rape establishment, where single-pass systems were proving succesful. Grant Thornton’s Gary Markham urged groups to fully exploit their tax allowances, and avoid the mistakes of one group that left £173,000 worth of allowances unclaimed.
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