Planning your margins before putting seed in the ground – Farm Contractor & Large Scale Farmer

As with everything in the Omnia platform, the rotation planner starts with the collected data: the various map layers and field performance indicators that growers will be using to make day-to-day decisions. From here, it’s possible to input the planned rotation, however long that may be, and bolster this data with inputted knowledge from the farmer.

“For example, if you know that certain fields, or certain parts of a field, don’t perform as well as others, you can input a % yield value that will adjust the gross and net margins for that block.

Once this base rotation is completed, it’s possible then to run a sensitivity analysis. This essentially asks the system ‘what would happen if…’ and allows the grower to make informed decisions across the rotation.

“The system can handle multiple scenarios. So, if a grower is considering moving away from deep soil cultivations to a minimum tillage, they can see how this would impact establishment costs but also account for any yield penalties that would come from this, giving them a net margin across the rotation,” he said.

Knock-on effects can also be predicted. If a nitrogen fixing crop is put into the rotation, meaning that less fertiliser will be applied the next season, this can be integrated and the cost of production for the following crop will be adjusted. Mr Foyle highlighted that rotational balance and said one of the key benefits of this tool is that not only can you see your margins per crop, but you can also see gross and net margins per hectare, allowing holistic decisions to be made. This could be the integration of cover crops, which obviously come at a cost but don’t always have the benefit of putting money back into your pocket. Instead, growers can plot out the long-term effects of using these and see if the margins per hectare increase.

By taking a holistic view of the rotation, growers can fam in a way that benefits them instead of working to the market.

“If you looked at the prices today, compared to some break crops, you may be tempted to grow greater areas of second wheat next year;” Mr Foyle said. “By considering the increasing input costs and yield lag, as well as what the next crop may need to yield well, growers will be able to see if this is the right decision in the long term. What would happen if you swapped that second wheat with triticale, for example? With this data, it may prove to be more profitable over the course of the rotation to forgo that short-term gain.”

Different land uses can also be inputted. Will the farm benefit from renting fields out to potatoes for example? How does this income stack up against the crop currently in the rotation? As fixed costs can be adjusted throughout the model, it would also be possible to weigh up the added cost of any remedial work that may come from this decision.

Nor does this system have to be used for complex arable rotations. Grassland and livestock farmers can use it to manage their costs and decision making.

Stewardship decisions can also be inputted into the system. This can be roots-in-the-ground measures, such as woodland, biodiversity strips or cover crops, with the subsidy payments and any other possible incomes (from ensiling, or perhaps a fruit harvest depending on the tree type) treated like any other crop income.

However, it is also possible to use the forecasting model to predict the profit or loss of moving through these regulatory schemes.

For example, if the grower was planning to move to the Intermediate soil standard within the Sustainable Farming Incentive, they would be able to balance the increased cost of mixed species green cover against the higher per hectare payout and see if it makes financial sense.

While Hutchinsons itself does not offer a carbon credit scheme, those who are already receiving an income from sequestering carbon on their land, will also be able to add this to the forecasting model like any other income and balance this against the long-term impacts of any actions they take.

Does the potential carbon credit income of reducing fertiliser use for example, outweigh the potential yield penalty?

“Every part of the system is about weighing up the short term against the long term,” Mr Foyle said. “We can add a sensitivity % to the forecast, so that growers can see what impact a yield drop would have on their profitability. This could be the difference between choosing one course of action or another. We predict that most growers can survive between 5% and 10% yield volatility, but having this data means that they can be sure of the long-term health of the business.”