What’s IT got to do with it? How technology can help your farming business with finance

Over the last few years, more and more technology has been implemented into farming at all levels and sectors. At the same time, margins are getting tighter and tighter.

How do you know if it’s worth using, what is out there and whether it helps with that bottom line?

Matt Melksham, Partner at Westcotts, shares his views on how technology can help the farming sector and how your business could be using it.

The changing technology landscape

There is a misapprehension when speaking to people outside of agricultural circles that farmers don’t use technology. In parts of the industry, there is still hard physical work. However, the next generation of farmers are having to upskill themselves in technology. As margins are squeezed by rising costs and changes in subsidies, farmers today have to be tech-savvy to make the farm more efficient and profitable.

There are a variety of technologies which can be used, a selection of these are covered below.

1. Robotic milking parlours

The obvious change to some parlours is the appearance of Automated Milking Systems (AMS) i.e. robotic milking parlours. The average size of a dairy herd is increasing across the South West. Farmers are needing to milk more animals to gain the volume needed to be economically viable. Manually milking these larger herds by hand is no longer efficient and can lead to a number of issues.

To this end, we have seen an increase in farmers investing in part or fully AMS products on the farm. This can save hours of manual labour per day, which could be better spent elsewhere on the farm. Another advantage of these new parlours is that they don’t need to be managed and can collect valuable data.

As well as the AMS, farmers can now use “fitbits” for cows, electronic collars that track animal welfare and milking patterns. All of this data can be sent to a smartphone or central computer.

2. Drones and field sensors 

On an arable farm, tractors and sensor technology allows farmers to utilise field size to maximise each field’s yield. At the same time, soil sensors monitor soil health, moisture levels and nutrient content, enabling precise irrigation and fertilization.

These technology can maximise the chance of a good yield from each acre. Also, storage conditions ensure the quality remains high, gaining maximum price or quality of produced for feed.

3. Farm Management Software

The use of technology can provide farmers with significant data about their herd/flock or crop. To help make the most of this data, a good integrated farm management software package is important. This data can then be used to monitor yields, levels of fertilizer used to gain that yield, animal welfare etc.

With this in place, better decisions can be made year after year. It allows the farmer to look at an all-round picture of what’s happening on their farm.

4. Renewables

Farm technology has also enabled diversification and new income streams to come onto the farm through the use of renewable energy sources. In the last year, with volatile energy costs, lots of farmers – especially those running larger parlours with heavy energy costs – have felt the pinch.

The argument for producing some if not all the energy yourselves has never been stronger, even with the reduction in subsidies. The security these projects give to the farm, plus in some cases also bringing in a new stream of income, is invaluable.

How can you protect yourself?

As today’s technology continues to grow and evolve, the industry will follow suit. From apps that monitor herd health, drones that scan fields, and thermostat-controlled curtains that keep cows comfortable throughout the winter, the industry is becoming more advanced than ever before. Farmers will continue to strive to improve production, promote animal quality, and save time and energy on the farm.

But these large infrastructure changes are big shifts for farmers and landowners to manage and you don’t want to make the wrong decision. At Westcotts, we regularly see these new technologies coming onto client farms and making a difference. We can advise on tax reliefs and grants for future projects, and help you work out what is feasible.

Alongside our corporate finance team colleagues, we can find the best way to finance these pieces of kit, to get the new equipment on the farm as cost-effectively as possible.

At Westcotts we’re here to help. If you’re thinking of implementing new technology on your farm and need some advice, contact Matt Melksham.