Benchmarking the 2016 harvest

3 January 2018

We recently held an event attended by over sixty farmers discussing the results of the 2016 harvest for our arable clients. We summarise below our findings and comments:

benchmarking-table1

Taking a typical arable client’s overheads:

benchmarking-table2

Key trends

  • Higher yielding clients no longer necessarily generate greater management profit. Only about a third of our top management profit performers are also our higher yielding clients.
  • The majority of our top yielding clients grow spring and winter wheat with oilseed rape as a third crop.
  • Other income is increasingly significant and where opportunities exist, Ellacotts’ clients utilise their assets well.
  • Power and machinery costs continue to rise despite a drop in machinery reinvestment, as depreciation is replaced by repairs to older kit.
  • Farmers are still experiencing cash flow issues and timely payment of the 2017 Basic Payment will be key for many farmers.
  • The 2017 harvest, we believe, will show even wider variation between our clients with significant early crop sales and the improved prices currently on offer.