Growers urged to think outside the square

15 Aug, 2016 08:10 AM
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Supply chain expert John Campbell says farmers can value add their grain by managing grain storage logistics for an end-user.
Supply chain expert John Campbell says farmers can value add their grain by managing grain storage logistics for an end-user.

THERE ARE opportunities for Australian grain producers to move beyond the bulk market and value-add their product but they need to think outside the square to do so.

That was the message from a panel session at last month’s Australian Grains Industry Conference (AGIC) grower day.

Peter Longhurst, of Farmgate Exchange, said Australian grain producers had advantages and disadvantages in seeking a competitive edge.

“In terms of cost of production, we are not going to compete with the Black Sea countries, but on the other hand, we have a great product and we are well regarded internationally.”

Mr Longhurst said farmers may be able to play upon the reputation for quality by further embracing concepts such as traceability of grain.

“In our favour we have things like our clean and green image and supply chain assurances could be one way of building upon this.”

He spoke of farms marketing their grain as a single source product, focusing on positive consumer traits such as certified non genetically modified or certified organic grain.

Another possible means of gaining a premium product according to Mr Longhurst is dealing directly with a food supplier.

“Direct marketing opportunities can arise when a manufacturer wants a specific product,” he said.

“For instance, a biscuit manufacturer found nothing performed as well in its products as Rosella wheat, which was popular during the 1980s but is virtually not grown today due to new and improved varieties being available.”

“Farmers can look for these opportunities which could arise in areas such as this, where an end user has very specific requirements.”

Supply chain specialist and veteran grains industry identity John Campbell said with effort farmers could get returns by storing grain for end-users.

“Brewers or bakers they may not have the capacity and by getting your on-farm storage set up the right way and linking into the end-users’ timetable you can come to a mutually beneficial outcome.”

However, he cautioned storing grain required a long term commitment to infrastructure and adherence to grain handling protocols.

“It is not for everyone, it is not just a matter of putting grain in bags over the harvest period, but it is an opportunity for growers to differentiate their product.”

Grain Producers Australia (GPA) chairman and Wimmera farmer Andrew Weidemann said he felt pulse crops were a growing area of interest for growers.

“The focus worldwide is on protein and pulses fit within that,” he said.

He said pulse exports were an increasingly important part of Australia’s cropping industry.

“Within my local area there are six packing houses specialising in containerised exports and they are all focusing on pulses.”

Mr Weidemann said these physical diversification strategies were more appealing to growers than using pricing derivatives as a risk management strategy.

“History has shown we, as a farming sector, have struggled with using derivatives and that in turn has created reluctance to forward sell, so different crops or on-farm storage are being used as strategies to add to our bottom line.”

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FarmOnline
Gregor Heard

Gregor Heard

is the national grains writer for Fairfax Agricultural Media
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READER COMMENTS

Jock Munro
15/08/2016 10:20:22 AM

Here we go again- more advice from a brains trust on how grain producers might manage in an industry that is spiralling out of control due to the obligation free power that the middlemen now hold.
ATB
19/08/2016 10:01:36 AM

I think the brains trust have some very good ideas.. It's definitely an improvement on reading constant complaints about the MEGA MERCHANTS

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COMMENTS

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My total income is from livestock production in WA as a 1 man operation and I agree completely I
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i was 15 years old when I went up to liveringa station in 1961.with j.drakebrockman . the old