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Risk or reward? – CPM

With growers looking to ensure the long-term security of their farm businesses, managing and mitigating risk where possible is crucial. ...

By Charlotte Cunningham

UK agriculture and crop production is going through one of the most turbulent episodes in recent history, following Brexit, changes to the support structure, volatile global markets, and energy supplies – and now, a war on the fringe of Europe is putting global food supplies into further jeopardy.

These pressures are coming to bear on practical farm management in many ways and are likely to have an influence on both short and long-term future decision-making on farm, causing growers to mitigate risk where they can. But just how far reaching are those changes likely to be?

Some of the challenges and opportunities were explored in a recent CPM/Hutchinsons survey, which examined what changes growers may seek to make around rotations, nutrition, environmental management, and technology.

With cropping at the heart of arable production, most future decision-making will be based around what is put in the ground, says David Howard, head of integrated crop management at Hutchinsons.

And with current crop prices looking attractive, many are likely hoping to capitalise where possible, however, 43% of growers said they won’t be making any changes to their rotations to reflect the current markets.

In contrast, with input costs also at record highs, 35% of growers noted that they’ll be looking to include more pulses to minimise nitrogen costs. Also with an eye on keeping costs down, 27% said they’ll be including more spring cereals in the future.

“As a general rule, I think growers have been focusing a lot on evening up their rotations and taking a strategic approach to cropping over the past few years, so it’s no surprise that few are making changes,” believes David. “Close rotations have largely gone out the window due to other challenges – like weeds and pests – and instead, rotations now tend to be much more diverse.”

However, Matt Ward, head of services at Farmacy, says the results reflect just how much uncertainty is being felt at present.

“There are nearly as many people saying they’ll plant more wheat (16%) as there are saying they’ll plant less (14%). I think this is reflective of the uncertain times many growers are facing.”

While incorporating more legumes may help offset some reliance on synthetic nitrogen sources, the benefits go beyond this, adds David. “Legumes are brilliant options for improving the nutritional status of the soil in general.”

Suffolk farmer Tom Jewers believes it’s churlish to make dramatic changes based solely on the current outlook. “Arable farming is a gamble at the best of times. Most people have a set rotation for a reason. While high prices are great, the cause of them isn’t. For long-term sustainability I don’t think it’s wise just to jump at higher prices.”

However, if rotations aren’t fit for purpose, shying away from looking at other options may also be counterintuitive, warns Matt. “Carrying on regardless might not be the right thing to do for future viability.”

Oilseed rape prices are looking particularly buoyant, and with many growers reporting a better season – will these two factors be enough to encourage farmers to take a chance on the break crop once again? Almost half (48%) of growers said they’ll keep their area the same next season, while 13% plan to grow it for the first time in several years next season and a further 15% say they’ll increase their area to maximise the opportunity to cash in on high prices. However, 22% say it’s still too risky to grow the crop.

“With the current global challenges, I think it’s likely that OSR prices will remain high for some time,” says David. “However, the risk that comes with growing the crop hasn’t disappeared and it’s important to remember that a lot of people stopped growing it due to the severity of cabbage stem flea beetle pressures a few years ago.”

Tom is among those growers who are cautious. “It’s in our rotation and we’ve found that the only way we can get it to work is by sowing it early, straight after winter barley.

“But we had a nightmare this year,” he laughs. “I thought we had the job sussed, but this year we’ve struggled with winter stem weevil which, I have to say, I’d never heard of.”

Tom explains that the pest is similar to CSFB, with the main point of difference being that the larvae don’t have legs. It is, however, just as destructive and this highlights just how much risk there still is with growing the crop, he adds.

However, there are a number of steps growers can take to mitigate the risk, adds Matt. “Avoiding small fields and headlands is a good tip. There’s such value in the crop that you can avoid the headland and still make more money than not growing it at all.”

Based on the fluctuations in input costs-as well as the growing pressure to farm more with the environment in mind – many growers say that they’ll be changing crop nutrition and/or nitrogen management in the future.

The use of more organic manures and digestate looks set to increase in popularity, with 40% of growers noting this as one of the key changes they’re likely to make, while 38% say they’re planning on utilising precision nutrition to target inputs. A further 32% are considering the use of more foliar N products.

Tom says he’s likely to adopt a range of techniques, though lack of a decent local source of organic manure means this may not be an option for him. Matt says Tom’s predicament is likely to be the case for many growers. “I think a lot of people are understandably looking to organic manures but I think we have to be realistic about where good supplies can be obtained from.

“That said, I’m certainly having more conversations around how to use manure more efficiently – all of a sudden it’s become a valuable resource, not just muck.”

Through his involvement in the Hutchinsons Helix project and some positive trial results, Tom is also keen to get more from foliar N.

On farm trials observed the effect on yield when applying 160kgN/ha plus two doses of foliar nitrogen, compared with a more robust N programme. No statistical differences were found. “We’re looking at this again within the Helix project this year, dropping N rates to 130kgN/ha and I’m also doing my own trials using N rates of 80kg/ha.

“In the East, we tend to get a dry period in the spring, so I believe foliar applications have a place to get N on the crop in the absence of rainfall. The downside is that foliar products are particularly expensive, so there’s a balance to be found.”

Though more detail is still to be revealed, it’s been made clear that a more holistic approach to crop nutrition is likely to be incentivised under the ELMs. Of course, stewardship is nothing new, with 42% of growers noting that they’re already in a stewardship scheme and will look at ELMs when eligible. In contrast, 15% say they don’t know enough.

While Tom is in a number of stewardship options at present and believes they’re an important part of farming, he’s not convinced about what has been revealed so far about ELMs. “I’ve seen and read a lot and I don’t like what I’ve seen. I’ve also had many conversations with both my local MP and Janet Hughes (Defra) and I’ve concluded that the SFI is completely underfunded. One of our stewardship schemes ends next year and given the option, I’d rather re-enter that.”

Matt reckons that while protecting the environment is an important duty growers must undertake, there has to be a business case for doing so too.

Alongside rewarding public good, reaching net zero is also a priority for both government and agriculture, with the NFU setting ambitions to reach the goal by 2040. Many growers have made great progress already in reducing emissions with plans to reduce them further. In terms of how they aim to do this, 43% of growers say they will be planting more cover crops, while 39% plan to change establishment methods, 38% say they’ll do so mainly by reducing fuel and 31% say reducing fertiliser will be their main approach. Just 11% of participants revealed they have no plans to reduce their carbon footprint.

Hutchinsons’ new TerraMap carbon module is one of the tools available to help growers better understand the carbon impact of their operations on a realistic farm scale. It’s claimed to be the first carbon mapping service to provide a highly accurate baseline measurement of both organic and active carbon in the soil.

But how does it work? Within the Omnia Carbon management tool, it’s possible to create different rotation scenarios from types of cropping and variety, to stewardship and management practices and see first-hand the projected CO2 impact and financial performance, explains David.

Matt says that aside from the environmental benefits, a lower carbon footprint is just good for business. “Lowering emissions from agriculture revolves largely around being more efficient with resources and inputs – so that’s got to be good for the bottom line too.”

Not only does agriculture have the opportunity to reduce its emissions, but also to sequester and potentially sell carbon stocks in the future. However, there’s still much scepticism surrounding this, with 45% of growers saying they just don’t know enough about it.

“We’re of the opinion that there’s not enough information on what carbon trading schemes will look like and how they’ll be judged in the future,” believes David.

Tom adds that he personally won’t be looking to sell any carbon stocks until clear criteria is set out by someone official. “It’d be lovely not to have any government interference, but it does require some kind of regulation, in my opinion.”

Sustainability is another phrase talked about regularly, and for many businesses this means increasing farm productivity to ensure longevity and future business viability. But what’s the best way to do this? Half of growers say they hope to achieve this by removing poor performing areas from the cropping regime, while 42% say they’ll be looking into regenerative methods. Reducing fuel and artificial fertiliser usage and incorporating soil improvement methods were also noticed as key priorities.

While taking poorer areas out of production is a popular choice, Matt warns that this kind of decision making shouldn’t be binary. “I don’t think it should be a case of deciding whether to crop or not, but more about considering whether or not you should plant a certain crop in a certain year. Some crops are much more resilient than others, so it’s important to consider all options.”

With regards to soil nutrition, 58% of growers say they’re planning on using more soil nutrient mapping to measure and manage nutrition, while variable rate fertiliser looks to be an attractive option for 48%. Almost half (46%) say they’re also interested in the potential of using satellite imagery.

Yield mapping can also be useful, points out David, with 40% of growers noting that they’re already using it to highlight high and low performing areas and 37% to identify anomalies in a field. “One of the big perceived barriers with yield mapping is that combines are expensive and there are many growers running older machines which don’t have them onboard,” he explains. “However, it’s not impossible to have retrofitted yield mapping technology installed.

“While there may be a cost, I think it’s really important to remember that if we can’t measure something, how can we manage it? As growers start to replace older kit, I think yield mapping will become standard.”

Tom believes that having access to such a wealth of data nowadays is incredibly beneficial for those looking to be more precise and increase the productivity – and profitability – of their business, but it’s important to ensure the value of that data is being realised. “To get the most from data, you have to be strategically using it rather than just looking at maps. Our ambition is to be much cleverer with how we use our farm data and based on what we’ve learnt through the Helix project, I believe we can achieve the same yields with less inputs without really having to try. It’s all about just being smarter with what we do and where we put inputs.”

Matt echoes these sentiments and concludes: “Because we’re investing so much more in crops now, a one-size-fits-all approach is invariably wrong. By pooling all of the resources available, there’s a huge opportunity to protect the environment, ensure long-term business viability and boost that all important bottom line.”

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