TO celebrate its 40th birthday, Meridian Agriculture held a seminar last week in Hamilton, looking back at the past four decades and forward to the future of farming in Australia.

Meridian Agriculture is a consultancy with offices at Casterton and Yendon (near Ballarat) founded by Dr Mike Stephens AM - the firm has an emphasis on grazing and dairy farming, including an extensive practice in farm succession planning.

The format of the conference was based on a conceptual structure employed by Meridian which analyses the farm business in three major segments - Production, People and Profitability.

Each segment was addressed by a different consultant, with a live question-and-answer section following the three topics, and a summing up by Dr Stephens.

Production

Casterton-based Meridian director and agronomist, Andrew Speirs spoke first on the subject of production.

He began by listing some of the key deficits in agricultural knowledge and systems 40 years ago.

Mr Speirs pinpointed poor understanding of soil fertility, a moderate selection of available pasture species, inefficient grazing management and a low rate of livestock genetic improvement.

He did, however, stress that government research and extension (advice) was superior 40 years ago compared with today and he lamented the falling away of government investment in these areas.

He went on to contrast the current position where agriculture has made significant progress in fertiliser programming, pasture cultivar (variety) improvement and greatly enhanced genetic data.

He also emphasised the need for ongoing improvement of soil fertility.

Findings based on over 14,000 soil tests by Incitec Pivot Laboratories comparing data between 2014 and 2024, found that 38 per cent of pastures had below adequate levels of phosphorus (Olsen P less than 12) and 27 per cent had marginal levels of potassium (less than 140 milligram per kilogram as Colwell K).

“The impact of improved grass and clover cultivars can be significant,” Mr Speirs said.

“Research has found that extra 100 kilograms of dressed weight of lamb gain per hectare per year is attainable with an optimum mix of modern pasture cultivars, when these are evaluated with non-limiting soil nutrition and good animal genetics.

“The study compared the difference between a pasture with the perennial ryegrass cultivar ‘Base’ contrasted with Victorian perennial ryegrass.

“This research work was undertaken just south of Hamilton with prime lambs.”

He went on to give his vision of the future as being the optimisation of investment in soil fertility, pasture species, animal genetics and farm management.

On the carbon front, Mr Speirs talked about the need for agriculture to reduce methane emissions from livestock, stating that the average carbon dioxide equivalent (CO2E) per cow per year was 2.6 tonnes and the difference between the highest and lowest emitting cow was 0.6 of a tonne (i.e. plus or minus 0.6t around 2.6t or 23 per cent).

Mr Speirs went on to say; “There is a great opportunity to select livestock which emit less methane while maintaining productivity.  Methane levels can be reduced by one per cent per annum through improved herd genetics.”

On top of this, Mr Speirs pointed out, there are new clover cultivars with increased tannin levels which reduce the level of methane emissions by grazing livestock.  However, these are not yet available in Australia.

His concluding prediction was that in about five years’ time supply chains will want to know methane output and producers will benefit from a premium price or suffer a penalty according to their methane output.

“Management will be the key,” he said.

People

THE section on people was delivered by Meridian’s human resources consultant, Ben Reeve.

Beginning with the observation that, in any business, people are both a necessity and a problem, he went on to describe a four-piece jigsaw each with its own goal to:

•            Attract the right people

•            Retain the right people

•            Develop the right people

•            Have the leadership and management to achieve these

Mr Reeve went on to illustrate how with increasing demand from competing industries, agriculture was finding that there were fewer people available for each vacancy and consequently staff retention was critical.

He made the point that research undertaken by Gallup showed that in 75 per cent of cases, people don’t leave a job rather, they leave a manager (nasty boss).

What is more, Mr Reeve said, is that 86.2 per cent of job satisfaction can be put down to interest in the job (32.4 per cent), level of personal fulfilment (37.9 per cent) and degree of responsibility (15.9 per cent).

Surprisingly, salary only accounts for 4.9 per cent of satisfaction.

Mr Reeve emphasised the need for training saying that it was preferable to train employees but have them leave rather than not to train them and have them remain.

A critical issue which he identified was the need to give employees a sense of purpose. 

Part of this, he said, was the importance of making it clear to staff the reason behind decisions about what needed to be done.

In his outlook for the future, he differentiated between management which is focussed on the bottom line (profit) and leadership which is focussed on the horizon (long term goals).

Profitability

MERIDIAN farm business consultant, Bryony Fitzgerald, who has a background in beef, dairy and broadacre grazing, spoke on profitability.

In looking back at developments over the last forty years she highlighted, firstly at a world level, the growth of the European Union’s (EU’s) Common Agricultural Policy (CAP) and the growth of India as a consumer market.

At an Australian level, she saw the floating of the dollar, the introduction of the GST and the wool crash as milestones.

Turning to the farm, she saw the worsening terms of trade (cost to price ratio), global positioning technology (GPS), computers, smartphones and the rise in land and water values as having significance to farm profitability.

Ms Fitzgerald also stressed farm succession as being a critical issue and spoke of the problem of achieving fairness when equality is not possible.

As far as an actual prognosis is concerned, she said that she expected the incidence of drought conditions would increase and that society’s expectations of rural land ownership would be more strongly emphasised.

Concurring with Andrew Speirs, she predicted that market access for farmers would, in time, come to depend upon a social (carbon) licence of some kind.

Speaking about land tenure, Ms Fitzgerald anticipated that there would be a trend towards the separation of land and business ownership although she did not expand on this.

Stressing that some things won’t change, she pointed out that people who sleep well, have time to think and have good information usually make better decisions.

In talking about the key numbers in farm business analysis, Ms Fitzgerald said that besides items such as reported profit and return on capital, the amount of cash generated is critical.

Often, she said, corporate farms report profits which are largely driven by the upward revaluation of fixed assets (mainly land) and not by a cash surplus from farming activities.

Discussion & conclusion

MEDIATED by Meridian’s agronomy consultant, Sinead Barker, a discussion followed. 

Points raised included the importance and efficacy of small group training of farmers, the need for farmer input to TAFE training, and the poor integration of research and farmer needs.

Carbon was talked about in some detail.

In this regard, concern was expressed about the level of government expenditure on research into carbon issues but which was not farm related.

Farm carbon and biodiversity audits were discussed with one attendee having had this undertaken with relative ease.

Mr Speirs suggested that farmers tended to take carbon data “too literally” pointing out that University of Melbourne professor of sustainable agriculture, Richard Ekard’s findings were that there was a plus or minus 20 per cent margin of error for soil carbon and slightly more for shelterbelt tree carbon.

Greater precision will follow with continued research, he added.

Dr Stephens rounded the conference up citing ancient Roman polymath, Marcus Varro who emphasised the need for balance in a farm business; a healthy financial return balanced by a healthy farm.

It is probably fair to summarise Meridian’s outlook for farming as being that of an industry confronted by an increasing number and complexity of challenges but, at the same time, having the ability to learn and adapt and thus to prosper in the long term.