The cost of efficiency

So, I have to buy a cattle crush, which apart from the obvious pleasure of imagining who you would like to put in it, is a hefty bit of capital outlay for what will be a fairly small herd of Aberdeen Angus cattle. Luckily, my rural payment agency cheque should cover it (thank you German taxpayers) but purchasing this relatively simple device illustrates some of the difficult investment decisions farmers have to make in order to guarantee a reasonable living. 

To begin with, like everyone else, farmers are subject to the almost constant hard sell to replace, renew, rebuild and retire any old capital equipment; a new tractor every three years, lots of new fencing every 20, along with an endless variety of seed drills, slurry tankers, pressure hoses and biodigestors. The farming press draws the majority of its income from equipment manufacturers which is why some publications are nothing but wall-to-wall adverts for New Holland and Massey Ferguson. However, the real debate is whether the industry has reached a point where capital investment just isn't delivering the returns to justify the huge outlay. 

It used to be so simple. From 1945 to 2010, if you bought new equipment, dumped more artificial fertiliser on your fields and stuffed animals full of American grown soya beans your yield went up ten per cent a year, which justified the expense of a new combine harvester because the finance cost ate up only a small proportion of the increased efficiency. However, for reasons which aren't really cut and dried, around 5 years ago the efficiency increases that farming had enjoyed suddenly stopped. The rise of China as a major dairy and meat consuming nation is often cited by town-based experts as a reason for this, but here in the countryside the whispered conversation is that most of us are at the limit of what we can realistically produce without building the kind of mega dairies and beef sheds that everyone hates. The result is felt in consumers pockets as the prices for many staples has doubled in real terms in just a few years. 

Farming being the curious industry that it is, the response to the efficiency gap has been, perversely, to become deliberately less efficient. Feeding your animals by hand with a wheel barrow and a pitchfork was what my grandfather used to do, and seems both quaint and romantic, but it is also cheap compared with buying a £50,000 automatic feeder that won't deliver that extra bit of return. The imperative then becomes to preserve your margins by keeping costs as low as possible because this is inherently cheaper than chasing diminishing yields - we can also look forward to the return of hayricks and, hopefully, given the cost of hiring contractors these days, indentured serfs. 

Bizarrely this is also why it has become impossible to buy a second-hand small tractor at anything like a reasonable price; what many farmers in Devon have found is that although the new tractors have air conditioning and you can listen to Led Zepelin on an MP3 player, they are too big to handle the lanes and the steep contours of the fields. Also fixing them requires a PHD in mechanical engineering, which is why a lot of old Massey Ferguson tractors have been quietly rescued from the nettles and reconditioned at the fraction of a cost of a new model. There is one farmer in the village who's Fordson tractor is so old that it needs an emptied out shotgun cartridge banged with a hammer into a special hole in order to spark it into life. The main point is that they work and with nothing more than two sizes of spanner and a screwdriver you can maintain it yourself without too much trouble. 

In conclusion, I defer to the wisdom of my ever quotable neighbour who's views on the subject are clear cut: "Some of my gear is so old that it is starting to appreciate in value." Amen to that. 

Trusted and reliable: an old Massey Ferguson.