Monday, 18 October 2010

How to spin yields

It’s that time of year when companies start publishing their performance results and yields feature highly as a performance figure.

While no one wants to dwell on bad news it is worth bearing in mind how we all spin yields to give a more favourable flavour to the story.

For example, you start off with 4,000ha of crop planted in the autumn.

Following a difficult winter and or summer you only have 3,280ha worth harvesting having lost 18% of your fields to hail/rain/fires/pestilence or whatever.

Once the combines have cut the crop and it passes across the dodgy soviet era weighbridge in to the shed you find you have 9,800MT.

9,400MT off 3,280ha is 2.87MT/ha.

Let’s call it 2.9 which is as near as damn it is 3 as makes no difference so let’s call it 3.

This year our crop yielded about 3MT/ha. Hurrah!

Except what you actually produced was 9,400MT of 4,000ha which is 2.35MT/ha. Even though you didn’t combine those hectares you did spend the money on them.

And this is what went in to store. When you bring it out of store, allow a conservative 10% for “shrinkage” plus a conservative 4% for “admix” what you actually sell is 8,122MT

So, 8,122MT of 4,000ha is 2.03MT/ha.

Or about 2MT/ha.