WA broad-acre Farmers going ok
- By: "Farm Tender" News
- Cattle News
- Mar 19, 2018
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It’s a big numbers game in farming. The potential for high returns can often come with high cash costs, invested in the first place to either sustain a business or lay the foundation for future growth.
The record crop in 2016 continued to help generate good returns for farmers, with the average WA farm business achieving an operating surplus of $668,000 from a turnover of $2.2 million, according to Planfarm Bankwest Benchmarks research.
A higher average income helped to offset increased debt levels, with the debt to farm income ratio increasing slightly to 0.95:1, an indication of strength of the state’s farm businesses.
Equity levels remained steady at around 80 per cent, which analysts say demonstrates Western Australia’s broad acre agriculture industry is generally in good health and indicates a greater interest in business expansion.
It corresponds to research that shows the average cropping area increasing by 56.5 per cent to 3,155 hectares in 2016, up from 2,016 hectares in 2007.
It also aligns with anecdotal evidence at CBH that indicates an increasing interest by growers in leasing more land and expanding cropping programs – investments that can require upfront capital.
CBH Group’s Pre-Pay Advantage product provides growers with funds up front and the flexibility to decide how and when you use your funds.
Since it started in 2011, growers have used Pre-Pay Advantage for a wide range of investments from helping the next generation of growers start their farming business to simply topping up the nitrogen on a crop.
In the past three years, CBH has lent $384 million to growers through Pre-Pay Advantage. This year, CBH has increased the pre-payment advance rate from $175 per tonne to $200 per tonne, with a competitive, unsecured rate of 5.80 per cent.
Through a Pre-Pay Advantage contract growers commit to selling grain to CBH and in return, the co-operative provide growers with a pre-payment of those tonnes.
It’s our way to help growers grow their operation the way they want to.
Applications are open and growers can apply via CBH’s online portal, LoadNet.
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