When one truck of lambs sells for $100,000, one load of hay for $18,000 and a load of wheat for $16,000, surely these MUST be the good times! So how do we capitalise on these good times to be prepared for the tough times?
If I had a dollar for every time I was asked the question “what do the best businesses measure?” I probably wouldn’t be working anymore!
What should we measure to know if our farm is successful or our business tracking well?
Agricultural businesses are challenging to measure and to analyse on a comparative basis. We measure utilising cash flows and comparison to the actual performance, financial statements, yields, grades, carcass weight, fleece weights and more. Many of the things we discuss informally, over a beer at harvest or after the auction, focus on the top line. However, what about the costs associated with producing income?
Grain Market Update - a quick look at domestic and global trends
A look at some of the global commodity market trends suggests a promising outlook with ‘new seasons’ prices for wheat and barley still being at or above the $300/t price point, which is a good sign and may continue last year’s record highs of up to decile 9 for prices come harvest time.
When considering the role of a truck in your business there are some aspects that need close consideration.
Economics: Owning a truck and delivering grain will increase total income by transferring an existing cost (freight paid to others to get grain to end user) into an income for the farm. It is important to know the cost difference between owning a truck and using a contractor.
Logistics: Harvest logistics should improve when you own a truck.
Labour: Owning a truck provides opportunity for labour utilisation in the off-peak times.
ORM facilitates the GRDC Farm Business Updates. This month's Farm Business Updates will be held in: Elmore: Thursday 18th July - Elmore Memorial Hall Loxton: Tuesday 30th July - Loxton Hotel Naracoorte: Wednesday 31st July - Naracoorte Town Hall