A tough time to turn a profit

Haidee VandenbergheCountryman

He might be WA's biggest grain grower but even John Nicoletti concedes it's been a tough string of years for farmers.

And he's not entirely sure this year will be any better.

Last year, John delivered more than 110,000 tonnes of grain from 86,000 hectares of paddocks that span the agricultural region from Mullewa to east of Esperance.

But he said despite outlaying $30 million to plant and grow his program, he made very little profit.

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"I had a very good production year when I average it out," he said.

"I had a very good season in the north - the best ever. I had a moderate or above average season in the Wheatbelt and below average in Esperance and having delivered a lot of grain, by the time we paid everybody, we probably made a very small profit.

"To turn over $30 million to make very little profit is pretty disappointing."

Given the poor outlook for grain prices, John said he would prefer not to plant anything this year but it wasn't that simple. He said he had given up one of his leases at Esperance and would plant a slightly smaller program, with a little more canola.

But for the most part he said he was still forging ahead "business as usual".

"We would like to say we're not going to put a crop in but our debt is structured so we can't afford not to put a crop in," John said.

"We are going to put a crop in, we are seeding and our program won't change much.

"It's anywhere between 65,000 and 75,000ha."

The Merredin-based farming giant already has seeder bars in paddocks at Mullewa, Moorine Rock, Marvel Loch, south of Bullfinch, Westonia and Esperance.

However, his land north of Bullfinch is simply too dry to seed and John said it was for that reason Federal Agriculture Minister Joe Ludwig's recent declaration that Australia was now drought free was a slap in the face.

"We've just gone through three pretty ordinary seasons, especially in the eastern Wheatbelt," he said.

"I was pretty disappointed to see (Senator) Ludwig the other day saying we're drought free.

"We've had three droughts and there are empty dams out at Bullfinch, empty dams at Salmon Gums - it's been very tough.

"Does that mean we don't count out there?"

John said he had been using minimal inputs and done a lot of rotation work to reduce risk over the last couple of seasons but wouldn't be seeking to further expand his operation, just yet.

"There's some great opportunities there but we have a partner called the bank and if the bank says we're not going to lend you the money then where do you go?" he said.

"That makes it hard. There are opportunities to expand but we can't have everyone selling their land for $100 or $200 a hectare less than what it's really worth because that brings everybody's values down.

"I don't want to be talking out of school but it's pretty tough out there.

"For those people who don't have debt, even they can tell you there's not much fat left at the end of the day.

"For the people that are paying interest like I am, there's even less in it."

John said he had now finished sowing the canola and was onto wheat, some of which he had already forward sold.

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