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01 Dec 2022

How to plan for profit using Omnia Digital Farming

Hutchinsons Ltd Hall: 10 Stand information: Hall 10 Stand 10.720
How to plan for profit using Omnia Digital Farming
Hutchonsons

The launch of Omnia Digital Farming’s Business Performance module offers an industry first capability for full farm rotational planning taking the guess work out of decision making. This exciting and ground breaking development uses farm data to cost out a range of potential cropping and machinery scenario’s in terms of both financial and CO2 equivalent performance.

The development of the Omnia Business Performance module follows on from the 2021 launch of the Field Performance Module which provided the ability for retrospective calculation of the cost of production of field operations in both £/tonne, CO2/tonne or CO2/ hectare.

Why is this so significant?

Never before has British farming been under as much pressure to manage output in terms of production and emissions, whilst also remaining financially and environmentally sustainable.

However at the same time, planning a rotation is more complicated than ever, and no longer are growers looking at just the historical Norfolk four course or two wheats and an OSR.

“There are several reasons for this, says Will Foyle, farm business consultant at Hutchinsons. “The economics of different crops has changed in response to fertiliser requirements. There is also a greater demand for oilseeds - all of which means rotations are being analysed more closely than ever before.”

“As we are well aware, this comes at a time when subsidies are reducing and there is a closer focus on increasing costs such as fuel and fertiliser.”

“Currently demand for land use is strong such as for short term lets for roots, vegetables, maize and rye. Opportunities for third party payments from water companies funding cover cropping, the emergence of markets for biodiversity net gain and the impact of carbon are also contributing to both short and long term changes in cropping that need to be assessed.”

“Alongside this, and coupled with schemes such as the Farming Equipment Technology Fund (FETF) and funding to support changes in machinery policy, growers are left doing the maths to see what is a viable option that could work for them.”

All in all it’s a really confusing picture, adds Mr Foyle. “How easy is it to look at the implications of buying a new drill on fixed costs, what is the real difference in costs and carbon if land is taken out of production and replaced with environmental schemes? How will the bottom line be affected if potatoes are dropped from the rotation.”

“These are questions that are being regularly asked but until now, have not been possible to model within a precision farming system using real and accurate farm data,” he points out.

The methodology

As with all developments within Omnia, the data is visualised through several layers or maps, making it very straightforward and user-friendly.

For each crop it is possible to build in variable costs and operations, or pull in those already defined in the virtual machinery shed within the Field Performance module, and then add in the rotation.

Income, variable costs, gross margin, fixed costs, net margin and tCO2e are calculated per hectare, as well as over the year. Different cropping or machinery scenario’s can be run alongside each other.

Mr Foyle gives the example of using the Business Performance module to look at the implications of moving from a tillage-type disc drill to a direct drill across a five year rotation.

“By inputting income, variable costs gross margin and fixed costs it shows that despite income, variable costs and gross margin remaining the same over the year, fixed costs decrease using the direct drill from 27% to 22%, as a percentage of output. tCO2e is also reduced.

However what is noticeable is that overall, net margin increases by £83/ha or £25,908/year.”

“Another scenario could be to assume crop rotation and output remains the same but with different yield penalties applied for example.”

“So in short, it’s possible using the Business Performance module to cost out any range of scenario’s in terms of pounds and carbon, before implementing them on farm. This really is an invaluable exercise for any grower to undertake before making changes to current farm rotations or machinery to make the right decisions in what is currently a confusing picture,” says Mr Foyle.

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