July 15, 2014

Accurate statistics can help farmers to be more profitable

With information about prices, market trends and the supply chain, farmers can plan more effectively and run a more profitable business. Mick Keogh, Executive Director of the Australian Farm Institute (AFI), explains the importance of statistics and where to find the most useful ones.

Objective, robust and accurate statistics can help farmers make informed decisions and run more profitable businesses. Here’s how.

“For beef farmers, issues like prices, trends in livestock numbers and stock slaughter numbers can help them to develop future breeding plans, and the US beef cycle is also a very big determinant of what happens here in Australia,” says Mick Keogh, Executive Director of the Australian Farm Institute (AFI). “If you’re in the feed lot industry, you need to know about trends in grain prices. And supply chain information including farm gate milk prices would be extremely helpful to dairy farmers.”

Changes for the better

The AFI’s latest research report, “Is counting farmers harder than counting sheep?” found that Australia lags behind other countries in the quality of information that’s readily available. But thankfully, this seems set to change.

The Australian Bureau of Statistics (ABS) and the Australian Bureau of Agricultural & Resource Economics & Sciences (ABARES) both help with collecting statistics and compiling national data. And, in their report, the AFI strongly recommended that both Bureaus agree on a single, rationalised approach. Since then, they’ve embarked on a review of their work.

“We’re awaiting the outcome and hope beneficial changes will occur soon,” says Keogh.

A clear picture of industry trends, the structure of the industry and how businesses are performing can help governments to come up with appropriate policy.

“There’s also evidence that a more transparent market helps to minimise unfair practices and improve competitiveness,” says Keogh. “We have legislation in place that allows greater scrutiny of prices, and there seems to be growing interest in using that as a way of making sure the markets perform well. We’re already seeing this work effectively overseas.”

Good information available now

According to Keogh, there’s already plenty of useful Information available for farmers who ask for it.

“I think many farmers need to be a bit more demanding of the businesses they interact with,” he says. “For example, if beef farmers ask for feedback about the animals they’ve sold for slaughter they can find out a lot about how they performed in the market. A number of semi government agencies like Meat & Livestock Australia and the Australian Wool Exchange can also provide good information. And, on an international level, agencies like the US Department of Agriculture and the Food and Agriculture Organization of the United Nations (FAO ) have very good, comprehensive collections of statistics that can tell you a lot about what’s happening in global markets.”

Stock and station agents are also starting to provide market information, while banks – such as NAB – are increasingly analysing the agriculture sector and reporting findings back to their customers.

“Since the Statutory Marketing Bodies were disbanded we’ve been through a decade or so with information being less readily available than it used to be, but it’s definitely getting easier,” says Keogh. “Now it’s up to farmers to make sure they search out the statistics that are available and to ensure they know how to put them to best use.”

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