Bob Nixon farms northeast of Perth in Western Australia. This is a tough part of the world for farming, with annual rainfall of around 300mm.

Bob is a fourth-generation farmer on this family owned broad-acre cropping and livestock business at Kalannie, which is about 260km from Perth. Kalannie is situated in the central Western Australian wheat belt.

Western Australia (WA) is by far the biggest state in Australia with a footprint of 2,529,87km2, which is about 30 times the size of the island of Ireland. The state has a population of just under two million people, of which 73% live in the capital, Perth. This gives a population density of 0.79/km² so you could have to travel a long way to meet a neighbour out in the countryside.

WA is an agricultural state and it produces 13-15 million tonnes of grain annually. It is the largest grain-producing state in Australia and over 90% of its grain is exported. Exports generate more than $4bn for the WA economy each year and grain is the largest agricultural sector in the state.

A swing towards arable

In 2016, the family business of R Nixon & Co, Kalannie, planted 13,350ha of wheat, barley and canola (oilseed rape), with two sets of drilling kit. The farm also had 1,200 Merino ewes – about 25% of the stocking level that existed 10 years earlier. In 2017, the remaining sheep were sold, bringing 92 years of having a livestock enterprise on the farm to an end. This trend out of livestock is being replicated across the state.

The business bought another farm in 2017, leaving it with about 18,500ha of arable land, 18,100ha of which was cropped this year. The higher area has pushed the Nixons to acquire an additional set of planting gear.

The crop make-up for 2018 is as follows:

Only last week, Bob commented that his area in the north of the central wheat belt is having one of the best seasons on record for yield. Add to this the fact that grain prices are high due to the drought in Eastern Australia’s grain growing regions. He said that this will help farming businesses in his area to recover from last year’s poor season and provide useful resources into the future.

The first crop planted by R Nixon & Co was in 1927. Since 1999, the farm has experienced its driest and wettest seasons and its poorest and most profitable years. This variability may partly explain the fact that the farm’s 10-year average wheat yield has dropped by 250kg/ha since the end of the 1990s to today (1.58t/ha).

Attracting labour

One of the big challenges facing many sectors in agriculture is access to labour. This is no less an issue in Australia and, in particular, in a region with such a low population density. While Bob acknowledged that labour is a real issue for them, he commented that “if you’re organised and if you have a relatively professional businesses, then it’s not too bad”.

“We rely heavily on New Zealanders, as a lot of Kiwis come over to work in Australia. The good thing about the Kiwis (because it’s close and the work is seasonal) is that they come back each year. As well as paying them while they work here, we will pay for their airline ticket to get them here and back.”

European workers are more difficult due to restrictions around visas. Bob commented that if you take the time and trouble to get them trained, it is very difficult to get them back into the country.

Challenges in the wheat belt

The biggest challenge to living out here is probably isolation and lack of facilities. It’s not everyone’s cup of tea and, going forward, there will be fewer people as farms continue to consolidate. A few of our small towns, Kalannie being one of them, are already starting to lose critical mass. This is most easily seen when primary schools get below 20 children and local areas do not have enough people to maintain their football teams.

“Farming is not without its challenges too,” Bob commented. “The big change in the last 10 years has been the shift from seeding after rains to dry seeding. We now begin planting on a calendar date rather than waiting for rain.

“We start planting around 20 April. The three planting rigs operate 24 hours a day when we’re in full swing. The three tractors and two spray rigs cover about 800ha per day. The move to dry seeding partially forced the sale of the sheep. Also, when it’s necessary to plant in dry conditions it is essential to have soft soils with green cover on them and this is another reason why livestock was phased out.”

Mechanisation and machinery cost is another big issue. With a tractor and seeding rig costing up to a $1m, it is essential to put it over more hectares to keep the cost per hectare down. So machinery efficiency and dry seeding are big issues as they enable more hectares to be planted with a single planter. The objective is to have drilling completed in around thirty days.

Land cost

The low cost of land is one of the benefits of farming in that part of the world. Bob suggested that the home farm is probably best valued at about $300 per acre. But with farms being so big a purchase that still amounts to a lot of money. And with machinery being so expensive, one would need about 6,000ha of land to justify a tractor-drill combination.

However, if you have a smaller farm you can spend less on machinery. Bob said they evaluate their machinery costs in two different ways. One is the level of dollars invested in machinery relative to the hectares of land farmed. The other is the dollars invested in machinery relative to the income produced.

This double-barrelled approach enables them to work out the efficiency of their investment in machinery. They place little emphasis on the gross value of machinery investment alone.

Perhaps one of the benefits of farming in this area is that there is not much competition when land comes up for sale. At least there is nowhere near the competition that would exist closer to Perth or in the higher-rainfall areas. Bob said that corporates tend not to invest in low-rainfall areas due to the risks involved but there is some competition, especially on the good, light soil. However, there is no competition between areas of high and low rainfall.

In low-rainfall areas, it is common to get average returns on capital of over 10% but crop failures also occur. However, the higher cost of land in higher-rainfall areas makes a return on capital of over 5% difficult to achieve.

Grain marketing

All the grain produced by R Nixon & Co is delivered to the local depot of the CBH Group. This is a grower-owned storage, handling and marketing cooperative. Western Australia looks set to produce around 15m tonnes of grain this year, with over 90% set to be exported.

This mainly goes to southeast Asia but exports to China are growing rapidly and it now takes all the feed barley. Bob grows wheat to supply the home bread market, as well as the Japanese noodle market.