Analysis shows regenerative agriculture cuts costs and grows profits
A recent study by our mentoring partners, Understanding Ag, has shown significant reductions in the cost of inputs on farms which have adopted regenerative practices.
At the same time, the 362 farms involved in this US study showed substantial increases in soil organic matter and forage production.
Understanding Ag tracked the progress of the farms over one, three and five years.
Results for livestock farms included, on average, a 38% reduction in veterinary bills over five years, 40% fewer days using processed feed, a 35% increase in forage production and a 62% increase in organic matter.
Results for arable farms included a 22% reduction in fuel use per acre over five years, 37% reduction in synthetic fertiliser applications and a 22% increase in organic matter.
Cutting costs at West Wharmley Farm
Northumberland beef, sheep and arable farmer Stuart Johnson - who is a member of our mentoring team - says he has seen the financial benefits of adopting regenerative practices over the last 12 years.
This includes reducing fertiliser usage from around 80 tonnes a year to nine tonnes. Only the arable ground now receives fertiliser at substantially lower rates. None is used on the grassland.
At today’s market prices this would be the equivalent of cutting a cost of up circa £28,000 down to around £3,200.
Annual spray expenditure has also dropped from roughly £16,000 down to around £3,000.
Stuart Johnson
Both these reductions also mirror a reduction in the overall acreage of arable grown. Stuart says this creates a system which feeds less cereals and has great implications for profitability and work life balance.
Overall purchased farm feed expenditure now stands around £20,000 compared to £40,000+ in 2012.
“Although all individual input costs have dramatically risen (some two or three times the cost per tonne than 12 years ago), we have managed to reduce the annual variable costs of a suckler cow from around £680 to less than £300, and a ewe from around £58 to about £40,” says Stuart.
“The overall profit margin potential increases, whilst reducing our exposure to uncontrollable input costs.”
“At the same time, output has increased (generally because prices have risen which is great) so the overall profit margin potential increases, whilst reducing our exposure to uncontrollable input costs.
“On the arable side of things, profit margins are much better than a conventional system on a seasonally lower yielding year, very comparable on a mid-level yield and slightly behind on a high yielding year.
“However, and although the difference in margins are not huge, we are doing it in a way that improves the soil health rather than degrading it and can continue indefinitely unlike much of the current farming methods.
“We are also doing it without the cost of high expenditures before evening getting to harvest, which makes us much more resilient and without the exposure to risk. It’s also a lot less stressful!”
Regenerate Outcomes works with
farmers to grow profits
We provide one-to-one mentoring to help you cut costs and improve crop and livestock performance.
At the same time, we baseline and measure soil carbon at no upfront cost to generate carbon credits which you can retain or sell for additional income.
Find out more by downloading our Programme Handbook.