We have been here before. I recently looked at an old issue of the New Zealand Farmer from May 1974 and farmers had similar concerns back then.
However, there are a percentage of farmers who, against the odds are making very good profits through concentrating on what they do best behind their farmgate. These farmers have a cost of production per kilogram of output that sits at less than $2/kg while the rest of us range upwards to as high as $5/kg.
This isn’t because they are spending less on their inputs, in fact quite the opposite. They are profitably producing more through efficiently controlling a wide range of management variables.
So rather than complain about the problems it seems far more constructive to look at the opportunities. And complaining is a waste of time anyway. Half the people we complain to simply don’t care and the other half are glad to hear we also have problems.
I took a role with the Red Meat Profit Partnership (RMPP) because it has a positive focus based on helping farmers make changes on their own farms that will not only help them increase profitability but the whole sector too.
Our research indicates that, for most of us, the largest potential profit lift can come from improving what we do on our own farms. This is great news because this is under our control – unlike exchange rates, what Trump might do next on trade, industry structure and so on.
So how do we know this? We looked at what the highest-performing sheep and beef farmers do and compared their profit results with the rest of us. They are doing well and manage to do well over time despite bad seasons and market fluctuations.
The next question is what do these high-performing farmers do that is different from the rest of us? For a start we found they don’t necessarily have a different game plan or work any harder, but they do keep a tight focus on measuring what is happening on their farms and they act quickly in response. To do this they gather performance data and use it to plan what they do. They plan for financial success and they also plan for having family time and holidays.
So in a nutshell, their success mainly stems from doing a lot of small things a bit better than the rest of us. So why don’t the rest of us do this too? This is the key question behind one of the core activities of RMPP: researching how to encourage farmers to adopt best practise.
This research has validated some key things many of us had previously assumed. A lot of farmers learn best from fellow farmers and need support from a variety of people to help give them the confidence to invest time, and often money, in making changes.
We know it is important to be aware of the real-life pressures that farmers face and how these can create barriers to action and change. It is easy for a farmer to be bogged down dealing with day-to-day things and not making the time to plan for making some changes or adopting some good ideas they’ve picked up.
Getting four or five farming businesses together in a group to challenge and support each other’s farm business improvement plans has also proved valuable. Supported by a high-performing local farmer mentor or a farm consultant, these group dynamics can be very good for building confidence and sometimes giving a kick up the backside when promised action falls off. Facilitated by our meat processing partners and with modest financial input from RMPP, we have trialled these ways of achieving practise change.
It is important to emphasise the importance of actively involved farming women in achieving increased farm profits. This is why RMPP has invested in Agri-Women’s Development Trust activities to get more women upskilled and involved in their farming businesses. This is happening in parallel to other RMPP courses such as facilitation training and computer courses.
Knowing how important measurement data is to achieving farm business improvement, RMPP has invested in making it easier to manage data. When fully adopted, Data Linker will enable data to be managed from multiple sources – meat companies, fertiliser companies and farm-generated data such as livestock weights and grass growth. This means at farm level you can use the information to make better decisions, benchmark your farm performance against others, and efficiently transfer data to and from organisations you deal with.
RMPP is also working in the education system at all levels to create more interest in sheep and beef farming as an attractive career. We need more people coming into the sector, and we want good people. Good people get good results.
RMPP has been working with our meat processing partners ‑ who have now been joined in this activity by the deer industry ‑ to streamline the farm audit process for farmers to ensure everyone is working to the same baseline standard. The NZ Farm Assurance Programme was launched in late 2016 and is now being implemented nationwide to meet marketplace requirements.
In conjunction with OSPRI, RMPP has also developed an electronic version of the Animal Status Declaration form to make compliance easier for farmers. This has been trialled across four processing plants to ensure ease of use for farmers, especially where connectivity is an issue.
The plan is to have seamless data flow from the farm to the transport operator to the meat processing plant. This means information will be shared between everyone faster with less chance of mistakes occurring because of not having to write up all details onto a paper copy every time.
RMPP has also researched potential transport and procurement cost savings in the red meat sector.
Despite a firm belief by many people in the sector that significant inefficiencies exist, a combination of patchy data and strongly differing views makes it difficult to advocate for sector-wide changes. Instead RMPP believes that actual per-animal procurement and transport costs should be given to farmers to encourage them to look for cost savings.
Our natural farming systems, quality and audit controls, and beautiful landscape are important attributes of NZ’s red meat products. We need to tell this story to consumers wherever they are. RMPP is working with Beef + Lamb NZ and others to help create this red meat sector story to boost the demand for our red meat products.
So, where do we go from here? RMPP has about three and a half years of life left and is now moving from engaging with a small number of farmers in our trials to rolling out our farm-practice change activities to any farmers who want to be involved. This roll-out will require involvement from a lot of rural professionals because they play a critical role in supporting our farmers.
Over the next couple of months RMPP will be getting in touch with NZ sheep and beef farmers to explain how they can become involved in joining the programme. This is a big but exciting challenge for RMPP and our red meat sector. I look forward to playing my part in supporting our farm businesses to make changes on their own farms in order to really start driving profitability increases.
The Red Meat Profit Partnership is a Primary Growth Partnership programme that is working to help the red meat sector increase productivity and profitability. Funded by 10 partners, government and the private sector, it works with farmers and sector business to develop, test and introduce new ideas, new technology solutions and new ways of working. RMPP chairman Malcolm Bailey owns a beef cattle and maize growing operation near Feilding. He also has investments in dairy farms.
