Busting the farming myths

Tractor and Machinery Association conference: Busting farming myths

Machinery
MYTH BUSTER: RM Consulting principal Adrian Kennelly said one of the common myths in agriculture was that the average age of the farmer was rising.

MYTH BUSTER: RM Consulting principal Adrian Kennelly said one of the common myths in agriculture was that the average age of the farmer was rising.

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Farming myths were busted at the Tractor and Machinery Association conference.

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Farmers are young, business orientated and making a profit, despite the on-going stereotypes.

Speaking at the annual Tractor and Machinery Association conference in Melbourne recently, RM Consulting principal Adrian Kennelly said one of the great myths of agriculture was that there was no money to be made from farming.

Mr Kennelly said if you assessed ABARES data by splitting out farmers with turnovers larger than a million dollars from smaller businesses, there was a vast divide in the levels of profitability.

"Not all farmers are the same," he said. "Some perform better because they are better farm business managers.

"The average return on large Australian cropping farms over a 27 year average, which includes the millennial drought, is actually higher then un-hedged global equities, but has a risk profile a quarter of them.

"You can make a lot of money in agriculture, if you do it well."

You can make a lot of money in agriculture, if you do it well - Adrian Kennelly

Mr Kennelly said those using data about farming needed to understand that there could significant differences between farmers on small areas and those who farmed as a primary business.

"Many [people who] live and work in regional areas potentially live on small properties, because that is the lifestyle you choose, and therefore you can call yourself a farmer and get the fuel rebate," he said.

Mr Kennelly said a major contributing factor to the misinterpretation of the data lay in the inclusion of small lifestyle holdings, often held by retirees, which was apparent when analysing longer term data.

"The reason our farmers are getting old is because they are either last generation farmers on small farms that don't have much growth prospects, either by choice, urbanisation, difficulties in the industry, poor farm management or they are lifestyle properties," he said.

"When you look at our commercial farms, the average age of a commercial farmer in 2006 was younger then the average age of a business manager for any other industry in Australia.

"It is a myth that all of our farmers are getting older. If you are talking about those who actually feed us, those who manage the industry....they are not."

Mr Kennelly said another myth was that farmers needed to focus on production.

"It's about margin, it's about spending a dollar to make a couple of dollars."

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The story Busting the farming myths first appeared on Farm Online.

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