The National Association of Agricultural Contractors (NAAC) has released its latest survey of contracting prices and is advising farmers and customers to expect price rises.
With fuel prices at record highs and the costs of labour and machinery escalating, contracting prices are rising, says the NAAC.
The current survey was carried out based on £1/litre for fuel, and contractors are being advised to calculate their fees carefully to ensure they are covering costs and can make a margin. This survey is only an average figure and farmers should expect their contractors’ prices to vary, plus be prepared that a fuel surcharge may be necessary if prices continue to fluctuate, warns the association.
“These are difficult times for everyone, and it’s vital that contractors work closely with their customers to ensure all businesses can remain viable and productive,” says Jill Hewitt, NAAC chief executive. “Profit must not be a dirty word if contractors are to keep pace with new technology, training and investment in their businesses, to supply the professionalism, machines and skills that are increasingly being demanded to meet farmers’ sustainability and environmental targets.”
The NAAC has recently launched a new on-line pricing tool for its membership, with Andersons Consulting, to allow contractors to evaluate each operation, considering all costs, so that they can see the cold, hard facts for each job, adds Jill. The tool takes account of numerous variables such as depreciation, repair costs of individual machines, yard costs, insurance and office staff, before breaking each job down, taking into account fuel costs, area of work, work rate, labour, downtime and profit. This will allow quotes to be made, backed up by statistics, to get to a price that is realistic.
“Inevitably farmers will get what they pay for in their contractor going forward and if an efficient, professional service, with well-maintained reliable machinery is needed, then a partnership approach will be vital.”
The new prices survey for 2022-23 can be found at https://www.naac.co.uk/pricesguide/