New guide contracting prices for 2020-21 have been published by the National Association of Agricultural Contractors (NAAC), giving a UK national average to help benchmarking for contractors and farmers.
Overall, there has been a small upward trend in prices from 2019, to start to reflect the increasing cost of staff and inputs.
However, prices may still vary significantly with region, soil type, customer size and machinery, and farmers should not be surprised to see prices quoted higher or lower than the guide. While cost is important to any business, farmers should also be considering the quality, reputation and reliability of their contractor to get a job well done.
‘Inevitably, in coming weeks, I will hear that these costs are both too high and too low. But I urge contractors and farmers to work in partnership, making certain more than just cost is weighed up,’ commented Jill Hewitt, NAAC Chief Executive. ‘Consider if safety management is in place, if environmental scheme requirements will be met, if there is sufficient specialist insurance and whether there will be security and longevity on both sides.’
When backs are against the wall, in times of bad weather, a contractor that turns up with reliable, well maintained machinery will be excellent value, if a crop needs drilling or is about to be lost if not harvested.
Like every industry, there is fierce competition in the contracting sector which can result in prices being driven down and a race to the bottom. However, a successful business is one that costs its operations carefully and refuses to work for less than a realistic price. There is little point being a busy fool, working all hours for little benefit.
The coming year will have a lot riding on it for land managers, dealing with the impact of a saturated autumn and Covid-19, with Brexit on the immediate horizon. Farming businesses will need a tight rein on costs, while juggling efficiency, carbon balance, soil management, environmental protection, animal welfare and the weather. This will be a time to review strategy and costs, assessing whether to share the risk and investment in high capital cost machinery and skilled labour with a contractor.
What is certain, though, is if farmers are putting their most valuable asset in the hands of their contractor, trust, skill and reliability will be as important to consider as simply price.
The full guide can be found here.