Gross Margins

NLF

Member
I'm not sure its that grim, certainly not for the top 25%. Note that these figures assume an imputed rent so where land is owned (and most land is owner occupied) that should be included in the profit. But yes, the bottom 25% should sell up.

I have recently run a few numbers on '22 and '23 harvest.

Unless yields are crop failure bad, gross margins for '22 will be spectacular, the best we have ever seen. With moderate yield estimates, using actual input costs and current forward prices I get a gross margin of £2,300 per hect for W Wheat. By gross margin, I mean crop sales less direct costs (ferts, sprays, seed).

Harvest '23 will less good, but still reasonable. Using current fert prices, assuming a decent dose of ag chem inflation and current forward wheat prices I see a gross margin of around £1,200 per hect. Even without BPS that still leaves a healthy profit after labour, machinery and other overheads.
 

teslacoils

Member
Arable Farmer
Location
Lincolnshire
I'd also suggest that the last ten years have made businesses more able to simply switch on or off depending on price.

Quite simply I expect a twenty percent return on money I invest in a crop, so if my cost per acre doubles then what I expect to see at the end of the year doubles.
 

som farmer

Member
Livestock Farmer
Location
somerset
the last few years seem to have got tougher, and many farmers are now at the stage, where they cannot cut any more costs. Its fine saying the top 25% are doing ok, what about the rest ? the bottom 25% will/should, retire. But there always will be the top 25%, so even if everyone upped their game to match, there would still be that top quarter.
Not sure anybody can do future budgets, with a high degree of accuracy, last years, for this year, were well out, on input and output costs.
Globally food is short, and many farmers cannot survive for long, under the present price system, so things have to change, unfortunately, for the consumer, prices have to rise. I have been of the belief, for several years, the only way to increase profit, is by cutting COP, no-one is going to pay a penny more, than they are forced to, to pay for product, and for much of the time, that means just over 'break even'. And who can blame them, we would do the same.
It will sort itself out, it actually has to, its not an industry that can be ignored, or side-lined, its one of the only industries, that cannot be stopped, without dire consequences, and perhaps its time, for our leaders, to realise that.
 

Cowcorn

Member
Mixed Farmer
To get the good prices early on, sheep were a massive amount of work. I don’t care what anybody says. Maybe if it was all sheep and no arable it would actually be easier as it’s just one thing to sort out but then parasites build up in the leys and you get issues.
Cattle, well they are different thing again.
No. No. No.
Doc , forget livestock their not really your thing maybe because you are to kind to implement the ruthless kiwi sheep techniques that seem to be in vogue .
Many years ago when sheep headage payments were first introduced my father and i went on a tour down to Carlow to Teagascs Knockbeg demo farm to see how to manage and farm sheep profitably .
It was a great day out and if i remember correctly barley and beet were grown to supply winter feed and straw and as entry for new leys .
A sheep shed was a crucial part of the equation as a the ewes were housed as soon as the lambs were weaned and fed straw to stop them getting over fit .
Anyway on the bus home i asked the auld fella what did he think would it be a runner ?? He replied " it would if it was in ye, but not for us were machinery men the would only leave us in the mental " .. And so are you Doc so are you .....
 
Trouble is with arable unless you are big the investment for grain stores, driers, machinery, combines is just not viable. This is also the case for other enterprises. Unless you dog and stick livestock re investment in infrastructure is just going up and up.
 

Nearly

Member
Location
North of York
Thing is, for those putting in owned land at zero, you're really just making 1.4 percent return in that. Putting in a true rent or equivalent shows your proper farming margin.

Living off a previous generations paid for land is little different from living off a current generations free labour.
What about doing both? :(
 

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HSENI names new farm safety champions

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Written by William Kellett from Agriland

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The Health and Safety Executive for Northern Ireland (HSENI) alongside the Farm Safety Partnership (FSP), has named new farm safety champions and commended the outstanding work on farm safety that has been carried out in the farming community in the last 20 years.

Two of these champions are Malcom Downey, retired principal inspector for the Agri/Food team in HSENI and Harry Sinclair, current chair of the Farm Safety Partnership and former president of the Ulster Farmers’ Union (UFU).

Improving farm safety is the key aim of HSENI’s and the FSP’s work and...
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