Onions star at events in Sydney and Melbourne
11 December 2024
Grower groups giving back to potato growers
11 December 2024
By Sandra Godwin
Redbank Farming owner manager Michael Nichols has his fingers in many pies and swears by benchmarking for making the most of every part of the business.
Benchmarking has already helped Michael fine tune seeding rates for optimum grain yield, and lift processing potato yields.
Now he hopes taking part in the national Level Up Hort program will identify further areas for improvement and potential savings in what is a highly diverse enterprise with a focus on profitability and sustainability
Michael and his wife, Rochelle, farm 385ha at Sisters Creek, in coastal north-west Tasmania, under the Redbank Farming banner.
They produce a long list of vegetable and broadacre crops – processing potatoes and peas, fresh onions, wheat, barley, canola, poppies, mustard and corn – as well as grazing beef cattle, hatching chickens, running radiata pine plantations and maintaining 100ha of pristine native bush on areas that are too steep to farm adjacent to Rocky Cape National Park.
As if that wasn’t enough, Redbank Farm also has a grain handling facility and Michael operates a grain pool for local growers who sell to local dairy farmers, as well as his own press for processing oilseeds into oil and meal, and provides contract services for spraying, muck spreading and harvesting grain.
Despite average annual rainfall of 1,200mm, all crops are irrigated and multiple private dams have been built to store the 400 megalitres Redbank Farm is licensed to collect from rain and runoff.
Last year’s dry conditions – 30 percent less rain was recorded and the summer electricity bill shot up 40 percent – severely tested the system, which uses a combination of centre pivot, linear and gun irrigators. After an irrigation assessment a decade ago, 50-year-old pipes are in the process of being replaced and pumps progressively added and upgraded with variable speed drives.
The 175ha of cropping land is on an intensive six-year rotation, with potatoes and onions every six years, and the other crops planned around them.
Michael learned the value of keeping records from his father, Andrew, who was using the farm management tool PAM Ultracrop 30 years ago.
“I found it was really valuable to enter the dollars that chemicals cost, the fertiliser, all your applications, and then you can actually do a proper benchmarking of how much you’ve spent per hectare on your cropping ground,” he said.
Michael said having that data had already enabled them to take part in several pilot projects and compare their operation with other farms in the area.
It also helped them identify the Russet Burbank potatoes they were growing yielded 20 percent less than they should. They then tried two other processing potato varieties, Ranger Russet and Clearwater, which averaged 80 tonnes per hectare this year.
“That’s the secret of benchmarking, being able to make informed decisions and acting on them,” he said.
Planting potatoes at Redbank Farm, Sisters Creek, in northwest Tasmania.
“Everyone talks about the top yields of all their crops, but if you have spent a fortune getting that yield it’s irrelevant. We aim to sit at the top 20 percent for gross return. I’m happy with that. If you’re down at the lower 20 percent then you know that you’ve got some improvements to do.”
Michael is keen to delve more deeply into whether they’re spending money on the right things, including the irrigation upgrades and contract services they provide to other farmers in the area.
He considers machinery one of their biggest liabilities, because of the size of their fleet and the skyrocketing cost of replacing machines and implements.
“Should we be reducing the contracting because of the cost of upkeep?” he said.
“Is contracting worth doing, for the time it takes us away from the farm, and are we making enough to justify wearing out our machines for that purpose?
“There’s a whole range of different questions that could be answered, and I guess it just depends on where we see our best return on investment.
“Our aim is to be in the best 20 percent of growers for most of our operations in cost of production.”
Michael said he was surprised so few farmers kept accurate records, let alone in digital format.
“We’ve been using Agworld and because I’ve got such good records, I can pull up on my phone now how much I’ve spent on each of my crops, and have all that information at hand,” he said.
Redbank Farm won the national Landcare award for Innovation in Agriculture in 2021, recognised for using precision agriculture techniques to address crop variability and resource use efficiency. It previously won the national Landcare award for Primary Production and Environmental Sustainability in 2004, it was managed by Michael’s father, Andrew.
What is Level Up Hort?
A five-year initiative fully funded through Hort Innovation, the Level Up Hort program provides specialised business reviews with a business consultant from experienced project partners Planfarm or RMCG.
Valued at up to $10,000 per year, it is open to vegetable and onion growers.
Participants receive two reports – a full business analysis and a benchmarking report, which are both private and confidential – comparing their figures against others. Each year the participant data is de-identified, aggregated and reported on a per hectare basis or as ratios for a national report. No yield data or specific crop line data is reported as part of the benchmarks.
The first national report released at Hort Connections in June 2024 represented 3,162ha of vegetables and onions across six states.
Its major finding was that the most profitable 25 percent of businesses recorded greater profit per hectare – also known as earnings before interest and tax – even though they spent more money per hectare of production in 2023 or 2022-2023.
The top 25 percent generated profit of $22,567/ha compared to $2,906/ha for the average, and a loss of $16,827/ha for the least profitable 25 percent.