Pitch your thinking higher

 The days of “just setting the buttons on the dairy farms and letting them run themselves” are over, says Rabobank business programme manager Nerida Sweetapple.

Speaking at the recent Australian Dairy Conference in Tasmania, she urged farmers to look at themselves as managers of rural enterprises. 

As demand for food rises with the growth of the middle class and a booming global population, farmers are in a great position take advantage, she says. But farmers must lift productivity and efficiency to reap the benefits; they must become better entrepreneurs.

 “We have to navigate through the complex role of the farmer; we should be looking at ourselves as business managers of rural enterprises. It often goes unnoticed that we are business managers and that’s how we should start to look at ourselves and educate ourselves. To lift productivity we need to behave more like businesses and corporate organisations.”

Rabobank sees today’s farmer wearing many hats; the role is no longer as easy and straightforward as in generations gone by.

Sweetapple says farmers must be better educated, able to negotiate prices and contracts and play a more active role in the supply chain.

“Farmers have to look more globally, not just in their local farming area, to see and know what is going on; you must learn to manage risk and strive for long term sustainability of your businesses.”

In addition to the many demands of farming there are complex global issues that affect the industry, many of which farmers can’t control.

But with planning and good strategy farmers can reduce the effects of these factors on their businesses.

Rabobank talks regularly to many farmers worldwide, finding everyone is facing the same challenges. “It doesn’t matter who you speak to or what situation they are in, no matter where you farm or what you farm, we find the feedback is the same. We ask them what their key challenges are daily; it’s growing their businesses in a sustainable way.”

 While there are some top skilled farmers, Rabobank says, many skills gaps exist in the industry, so the bank’s farm manager programme exists to help turn good farmers into good business managers.

“We try to fill the skills gaps; the programme looks at other successful farmers and businessmen and draws on their experiences; we teach our farmers to manage risk better, find efficiencies and keep ahead of changes.”

This is the tenth year of the Rabobank Farm Managers Program, from which 300 young farmers from New Zealand and Australia have graduated since 2006. Applications are now open for Australian farmers wanting to take part in the 2015 programme. 

Rabobank group executive for country banking Australia, Peter Knoblanche, says the Farm Managers Program is now considered a ‘must’ for young farmers looking to take over the reins of a family property or manage a commercial farming entity.

“The program offers a unique opportunity for farmers from Australia and New Zealand to get together, share best practice and discuss and workshop ideas.

“And we see those relationships continuing well after the program has finished, with participants often drawing on their network of like-minded farmers.”

Ideal location

Australia's close proximity to Asia puts its farmers in the box seat to take advantage of the demand for dairy.

Rabobank’s Nerida Sweetapple says there will be more demand for animal-based products, and the demand for dairy products in Asia will exceed the region’s own supplies.

“This will drive import growth and Australia is in close proximity to this growth region,” she says.

With Australia recently signing a free trade deal with China, Sweetapple says Australian dairy farmers are now on a level playing field with competitors such as New Zealand.

“We are even ahead of other global competitors when it comes to access into markets like China, the world’s largest dairy importer.” This means competition for milk supply within Australia.

Sweetapple says Australian processors need to ensure that milk production in Australia can meet the growing demands.

“This means for farmers more support, more options and better security in our dairy industry. Producers who can grow their business by improvements and greater productivity can reap benefits.”