Intensive agriculture must reduce costs says Nuffield Scholar

Managing costs is important to all businesses, but in the intensive world of meat chicken production, it’s critical.

For New South Wales farmer Guy Hebblewhite, keeping expenses under control on his Tamworth chicken farm is getting more and more difficult.

“Our costs are increasing at a great rate – electricity and gas costs on our farm are going through the roof and so to achieve some sustainable long-term growth prospects we need to actually keep a lid on those expenses,” he explains.

Guy decided there was a real opportunity to reduce his gas and electricity costs by using the manure produced on the property to create biogas, which is produced by the breakdown of organic material through anaerobic digestion.

Further capitalising on that, Guy wanted to utilise heat from the process to create a renewable energy source, and so in 2013 he embarked on a Nuffield Scholarship to study how businesses around the world were tackling the same problem

Starting in Canada after the Nuffield Contemporary Scholars Conference in 2013, which brings together all scholars studying in a particular year, Guy then also went to the USA, before then completing his individual studies in the UK, the Netherlands and Germany in June 2014.

“I went all over the place, it was absolutely fantastic learning from farmers who had actually adopted the anaerobic digestion and biomass technology in whichever industry they were in, whether that be a dairy, turkey farm, or just be a stand-alone unit built to utilise biogas and biomass opportunities,” he explained.

In terms of costs of the technology, Guy saw the good and the bad, with a considerable financial outlay for large operators using a biogas system.

“That technology was costing into the one or two million euros at that stage overseas, but the equivalent systems in Australia are up around the two million dollar mark, so they are very heavy capital investment options.

The good ones were operating very well, however I did actually see a couple of these units in Germany that had gone into receivership due to high ingredient input prices,” Guy recalls.

However, despite the high capital costs, the benefits of generating electricity and heat from the units cannot be ignored.

“The banks in Holland now will not fund these projects without the heat being utilised in some way, so they’ve actually said, great that the electricity is produced, and we can generate that electricity very happily, but the heat must be used in some form,” Guy explains.

So what can Guy implement on his northern NSW property, and recommend more broadly to his industry, as a result of his Nuffield learnings?

He believes it all starts with thinking outside the square about the technologies available and, most importantly, seeing beyond the short term cost to the long-term benefits.

“We’re very happy to keep on paying our bills every month to the electricity and gas companies, but rather than doing that we could actually look at utilising a model I think that could actually pay off these investments a lot quicker, potentially over a four to seven year period and then actually be operating on free energy.

So we just need to think outside the square, it’ll certainly be an investment model that needs to join with the theory of how to actually get these sites established, but it can be something that is actually very exciting for the industry into the future,” Guy says.

Guy’s scholarship was supported by the RIRDC Chicken Meat Program. Nuffield Australia provides opportunities to Australian primary producers and managers between the ages of 28 and 40 to travel the globe investigating a research topic important to them and Australian agriculture.

The organisation is currently taking applications through to the 30th June 2015 for the 2016 scholarship program. A $30,000 bursary is provided to successful applicants to carry out their study over a two-year period.

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