Farmers using regenerative practices on their arable farms are largely ending up in a similar place financially to those using more conventional practices, according to four years鈥� worth of data assessed by rural advisers, Land Family Business (LFB).
LFB director, Gary Markham, who presents the results each year at Groundswell told the audience: 鈥淥ver the past four years the margin 鈥� being gross margin less labour and machinery 鈥� has been very similar in both systems.
鈥淭he Groundswell benchmarking group who use regenerative practices have on averageup to20 per cent lower output but lower costs, and they end up in a similar place financially to the conventional farmers.However, the key point is that there is lower working capital and particularly lower capital tied up in machinery.鈥�
Wheat price
The research found that on average, variable costs for regen systems were 112/ha less, labour and machinery was 155/ha less while output was 244/ha less, giving a margin of 23/ha more than in conventional systems.
However, with wheat at 300/t, the gap in productivity provesrelativelyless profitable for regenerative systems with a 499/ha differencepredicted for the 2022 harvest.
Mr Markham said鈥淗owever, farming is a long term business and whilst margins may be higher in conventional systems this season, this is probably only likely to be a blip.It is far better to have a sustainably profitable business than knee jerk reactions to a very volatile market.鈥�
LFB also compared the amount of nitrogen used between the two systems, with convetional farmers using on average 40kg/t more in OSR and 9kg/t more in wheat crops.
