Planning for the year ahead – the MSP farm

Ben Gothorp, MSP Technical Officer, takes us through how he plans for the year ahead on the MSP company farm.

 

Planning for the year ahead is important for any business. It helps critical analysis of current performance, provides us with a realistic baseline for budgets, sets goals and protects against the impact of variables that we cannot manage, such as farming policy changes, environmental impacts and changes in markets.

Our company farm is run without funding from the Basic Payment Scheme (BPS), therefore the need for maximum efficiency is absolutely vital. Without detailed and accurate forecasting we could run the risk of cash flow challenges when looking to purchase inputs, for example.

To help even out the peaks and troughs, we grow our barley (both spring and winter malting barley) on long term contracts that are structured in such a way that protect the producer in a falling market. These ensure that we will always have a buyer for our barley, even in years where the market demand is low.

With the help from our excellent Grain Team at MSP, a proportion of our wheat and oilseed rape is sold forward so we have a guaranteed price for a set tonnage of these crops. The remainder is sold on a wheat pool – helping with cash flow issues through the winter. A wheat pool manages the risk over a longer period of time, so it helps us get the best out of the market and manages our risk accordingly.

Solely arable enterprises struggle with cash flow throughout the year, so selling our grain over a longer period of time helps spread our income throughout the year. Plus, by growing malting barley this ensures we have an immediate influx of capital as soon as the harvest is completed, allowing us to begin purchasing the inputs required for the following season, such as fertiliser and seed.

However, to ensure maximum efficiency these inputs must be carefully planned – this means growing the highest yielding varieties for our situation; planning fertiliser applications so that we can maximise nutrient use efficiency and minimise nutrient loss; and using the most advanced chemistry to ensure the crop is kept healthy and can therefore produce to its yield potential.

When planning cultivations and agrochemical applications, we source and use the most effective products and methods to ensure we get the best out of our crops. Unfortunately, even the best laid plans don’t always work out as this year – which is on track for one of the wettest in history – has proved.

The ground conditions were unsuitable for drilling so we have had to replace a large area earmarked for winter wheat with a planned increase of spring barley. The reduced area of wheat that has made it into the ground is looking a bit rough around the edges, so we will continue to cross our fingers and carefully monitor how this crop progresses through to the spring.

Overall, planning and flexibility is key when looking ahead to 2020 – if you are well prepared, it makes it that much easier to adapt to the challenges the new year will inevitably bring with it.

 

Looking for some advice on how you can get the best out of your farming business? MSP can help – view our products and services or get in touch with the team today.