MEDIA RELEASE
Friday 24 October 2008
Free Tool to Pin-point Your Cost of Production
The Advisory Board of Agriculture has developed a new simple tool for grain growers to work out their cost of production and profitability on farm.
The electronic spreadsheet enables farmers to enter their cost of production figures and calculate automatically their target net farm gate price.
ABA Yorke Peninsula representative Richard Murdoch says with drought conditions continuing, the cost of putting in a crop is risky business.
“Farmers really need to know where their business is at financially to know what risks they can afford to take . . . this tool helps to do that,” he said.
“In less than 10 minutes you get a quick and timely snapshot of your business costs and what needs to be achieved during the season to make a profit or to cover costs,” he said.
“You will have a better understanding of where your business is heading and be more prepared when making grain marketing decisions.”
Mr Murdoch says the tool is easy to use and can be used regularly as yield expectations change.
“By using five year yield averages you can also determine your long-term goals,” he said.
“It’s about giving farmers the power to take control of their decision making.
“If you know you need to achieve a certain price for your grain to remain sustainable, then you are in a better position to negotiate.”
While this spreadsheet model is specific to grain production, the ABA is planning to develop other models covering other commodities in the coming year.
Copies of the tool are available by contacting the ABA on 1800 652 258.
