Joint venture farming conference

1st February 2007

Siôn Roberts, Chief Executive, EFFP chaired an impressive line up of speakers and introduced the conference by reflecting on the very successful 'Share to Grow Combinable Crops' initiative developed during 2005/6, aimed at stimulating interest in arable farmers collaborating to share labour and machinery. That programme used case studies to demonstrate the financial savings of around £100/hectare and illustrated the other non financial benefits, importantly having someone else to work with made farming more fun again. The uptake since these meetings has been very good with many new groups formed.

This conference encouraged machinery syndicates to the next level, being able to start to share best practice and refine their systems even further. The Joint Venture Farming Group, coupled with Grant Thornton's machinery syndicates form an excellent platform for this purpose.

Gary Markham, Grant Thornton presented his 2005/6 figures for costed arable farms. This showed labour and machinery costs as follows:

£ / Ha

Top 25%

Average

Bottom 25%

Syndicates

Labour

42

64

86

59

Machinery

225

279

449

133

Other

27

27

27

27

Total

294

370

562

219



This demonstrated how much potential savings could be achieved by labour and machinery syndicates. The only proviso Gary made is that the labour costs are recharged from the farm business to the syndicate on an hourly basis as labour usually stays employed by the original farm business. This can expose the excess of 'unproductive' labour cost left in the farm business.

Jamie Gwatkin, who has pioneered the bench marking work for the newly established Joint Venture Farming Group released the results for the seven fully costed groups. This shows very similar average figures to the Grant Thornton costed farms but also demonstrates a huge range within those syndicates:

£/Ha

Average

Range

Labour

63

19 - 93

Machinery

127

96 - 161

Other

21

7 - 44

Total

210



Jamie highlighted a number of areas that needed further investigation which the JVFG benchmarking group would in time throw light on:

  • Managing the cost of front line crawlers and combines and the cost effective use of contractors
  • The true cost of maintaining ELS and CSS Schemes
  • Review of labour efficiency
  • The benefits from sharing gross margins
  • The need for Corporate Governance and director training for the syndicates
  • Overall there are huge differences between groups and a lot that can be learnt from each other.

The Joint Venture Farming Group is encouraging members to join the benchmarking project at £500 per annum or the discussion group forum at £150 per annum.

Conference presentations

Jamie Gwatkin - Presentation

Gary Markham - Presentation

Contact Jamie Gwatkin for more information

Contact Gary Markham for more information