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Are Computers replacing Farmers?

There has been a lot of discussion about the potential impact of "Big Data" on Australian agriculture over recent times, with views ranging from "They'll never replace farmers" to "Its the end of agriculture as we know it, and farmers will soon be redundant." Exactly where advances in computer technology and digital information will take the agriculture sector over the next few decades is as yet uncertain, but what is already clear is that it is likely to result in pretty significant change.

In summary, the use of data analytics to analyse enormous datasets (think of a database of all the individual customer transactions of a major bank over a year, or all the purchases made by supermarket customers over a similar period, - both of which also have customers personal details included) banks now have this information available for retail business  to produce insights into customer behaviour, it is effectively replacing the judgement and experience of managers rather with computer processing power instead.

"Now comes the second machine age. Computers and other digital advances are doing for mental power – the ability to use our brains to understand and shape our environments – what the steam engine and its descendants did for muscle power." (Erik Brynjolfsson, Director, MIT Initiative on the Digital Economy, Massachusetts Institute of Technology, 2015).

As recently as perhaps ten years ago, the cost of storing digital information such as harvester yield maps for example would have been prohibitive, it is now rapidly approaching the point where data storage capacity has no cost, with new cloud based systems

Computer developments appear more advanced in the cropping sectors, but applications are also beginning to emerge and gather momentum in the livestock and horticulture sectors. Exactly what the implications of these developments will be for the future of farming is as yet unclear in my mind. Perhaps the response that "a computer will never replace a farmer" is more wishful thinking than most might realise!

How to survive on the Farm

How to survive on the farm

Primary producers have always been creative, otherwise they wouldn't survive. Their world is full of changing conditions and circumstances, to which they adapt, as a matter of course.

However, this does not always apply to the survival of the farm itself.

I read recently where Isobel Knight of Proagtive (based in Tamworth NSW) stated that "most farmers don't use their accountant to see how their business will stand the test of time or to delve into what's required to maintain its viability and give clarity  and direction to the next generation."

She also indicated that farmers needed to lift their financial acumen by focusing on farm strategy for and involving the next generation. The aim should be to grow the asset base, not divide the asset pie.

One of the changes we have noticed is the concept of separating the ownership of the farming land from the entity operating business of farming on it.  This can provide security for one generation and an opportunity for the next.

There is no one size fits all in family farming. Sometimes the family farming model is not a good fit at all.

We have the experience and expertise to assist in lifting financial acumen and providing assistance to all parties involved in finding creative strategies for the future.

Nothing Beats First Hand Knowledge

One Friday 14 members of the Accounting team at GMG jumped in the utes and took off out into the Mallee to visit the White Family to learn more about what farmers actually do, to get an understanding off the challenges they face, about how updates to equipment and technology assist farmers today and a live demonstration of the sowing process.

After a short while in the car we reached our destination in the Manangatang region. What a lovely place, I couldn't understand why I had never actually visited the area before. At our first stop we became familiar with a Disc Seeder, CAT tractor on tracks and a Grouper.  Many including myself had no idea what a Grouper actually was, it was interesting to see how it worked and the efficiencies it created with the speed in filling the seed box with seed and fertiliser in the paddock.

Andy backing up the grouper to the seed box. RIGHT HAND DOWN ANDY!!

In the same paddock we were shown different soil types and it was explained to us what strategies are used to maximise yields in any given paddock as well as the pro's and con's of sandy soil versus more heavy clay type soil.

It was interesting to hear how heavy country in the past was something that farmers really wanted because it was able to grow better crops with lower rainfall and how sand was generally considered more difficult land to farm and hence worth less. What our client explained was with new technology, new and improved grain variety's and farming practices that preserve soil moisture this has resulted in a move towards some of the lighter soils which have now started performing well.

We got an insight into the different varieties of grain and why farmers rotate from one variety to the next. What Rust is, I thought rust was something usually found on a Holden or Ford. Rust is dispersed by wind or moisture it is actually a fungus type disease that attaches itself to the plant and can significantly reduce yields if left unattended.  

Sam's rig in action (above)

Direct Drill          

At our second stop we were shown a tine seeder, spray truck, header and various other pieces of equipment used over the years and still used today. A slightly different, larger and possibly more sophisticated seeder is the Tine Seeder, which offered other advantages over the disc seeder such as consistent seed depth and accuracy in hilly country, it also packed the dirt down better which helped trap the moisture in which encourages seed germination.  

It was explained to us the challenges that farmers are faced with this year due to the lack of any post harvest rains, moisture being a major issue but also the difficulties of weed control when it does rain and how seeds from previous harvests are usually eradicated with summer rain and summer sprays.

We were given an insight into how the GPS and Auto steer assist farmers to gain efficiency with driver accuracy. It is amazing how accurate GPS can be compared to driving freehand and over a large paddock how much land would either be missed or overlapped hence wasting time, fuel, chemical, seed etc. DVD players and TV's also play a part in farming! The idea being the help to keep the driver awake and allows the driver to spend more time behind the wheel, sure beats staring out into the paddock for 12 hours straight. 

CAT Tractor &Tine  Seeder

Overall it was a very informative and interesting trip, we all learnt so much from it. Thank you very much to the White family for taking the time to educate us on grain farming, I think it was an eye opener for us to see just how involved and sophisticated the industry has become.

  

 

 

A Grain Of Knowledge

 

A recent session at the GRDC advisers update raised some interesting views . I was suggested that most farmers spend more time looking how to sell their crop than focussing on when to sell .

 

Suggested steps to developing a marketing plan include

  • Calculate the gross margin of the crop i.e. your breakeven price , which becomes your initial target
  • Create a cash flow budget the will tell you when receipts from sales are required
  • Determine when to sell in relation to the production cycle , pre planting , post planting , pre harvest , at harvest , post harvest
  • Determine how much to be sold /priced at these periods
  • Determine how to sell/price any sales before harvest ; swaps, options or forward physical sales
  • Determine what price to be targeted
  • Determine how much will be carried over to the next crop and how long this will be held for

 

It was also suggested that farmers should consider forward selling 2014 now as well.

Sheep or no sheep

The question is often debated about the value of running sheep in a cropping business. We have found that the running of sheep often depends on whether the individual likes or hates sheep. 

Read more…



 
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