Overview of the Future Farm Business (FFB) is an interactive, group-based simulation exercise developed to help participants learn about managing a farm business via risk and uncertainty scenarios subject to natural resource constraints.

1. Future Farm Business (FFB)
A participatory action learning workshop
Amir Abadi
Future Farm Industries
Cooperative Research Centre

2. The Challenge
 Can you build and run a sustainable and resilient farm business?
 You need to decide on yearly allocation of land and input like fertilisers to:
– Annual crops lik wheat and canola or annual pastures lik clover or
A l like h t d l l t like l
– Herbaceous perennials like lucerne or saltland pastures; or
– Trees for wood, CO2 Sequestration, biomass, oil; or
– Deep drains to reduce water tables
 Must consider past farm records of climate and commodity prices (markets)
 Bear in mind risks and uncertainties of climate, markets & innovations
 Manage the stocks and flows of cash and credit as well as assets and
liabilities
 Mind the ground water and manage hydrology if you can to arrest or delay
damage to soils and loss of productivity

3. Future Farm Business Issues
 Adjusting the production systems and mix of crops and livestock to
– Ever changing commodity prices
– Deciding if recent price/cost trends are here to say
– Land use sequence and choice of crops, pastures and rotations
– Cost of inputs and adjusting to rising price of fuel, fertilisers and herbicides;
 Climate Change
– Higher risk and variability brought on by known and predicated climate
change;
 Choice of innovations – finding, evaluating and deciding the best way of
adopting:
– T
Trees grown i b lt f woody bi
in belts for d biomass and associated end products lik
d i t d d d t like
energy, oil or wood;
– Trees in block plantings for reafforestation
– Trees for permanent carbon sequestration;
– Perennial pastures like Lucerne
– Saltland pastures on saline land
 Management of farm’s hydrology and movement of water
– Engineering solutions like drains or plants for managing recharge and
discharge;

4. A Participatory Action
Learning Environment
 Learning from self, peers and presenter
 Engaging - happy minds learn better
 To learn how to make good decisions
 Lets participants choose their responses
 Need to
N d t cope with i
ith imperfect k
f t knowledge
l d
 Combination of rivalry and co-operation
 Software synchronises scenarios and choices
y
 Software checks and verifies adherence to rules
 Data demonstrates key concepts
 Game offers teaching moments
 No one right answer – participants may
– share their opinions and
– discuss reasons for their choices

5. See the farm layout
and its features
including the area
and elevation of
each of the nine
paddocks (fields)
Each tile gives a summary of
how a paddock is being
managed in any given year.
year
It also shows the returns
from the field in that year.
Clicking the tile allows you
g y
to change its land use for the
forthcoming year.

6. Each season ends with a display of summary report of land use
selected by the grower for that year, condition of the land at the
l t d b th f th t diti f th l d t th
end of the season, profit and loss, and the closing equity.

7. Climate and market outlook for the forthcoming season combined with
summary tables of past records of rainfall, p
y p , prices and land use help the
p
partners decided what to grow, where to grow them and estimate how
much they expect to earn for the year..
Market outlook
for all the crops
(and livestock)
( d li t k)
provides an
Analogue years
indication of the
give some
revenues that
indication of the
can be generated
kind of season
from each
that could be
e te p se.
enterprise.
facing the
grower

8. Chart s show how
crops and pastures
respond on different
soils to incremental
il t i t l
changes in inputs
(like fertilisers) and
rainfall

9. Good managers use records to get a
realistic sense of the potential of the
resources at their disposal to generate
cashflow and profit. Partners use this
records page to check historical
d t h k hi t i l
prices, past rainfall, water tables
(salinity levels), preceding land use
sequences and key financial
indicators like equity etc.

10. Land use choices (i.e. choice of
annual crops and pastures, trees
l d
and drains) will affect the amount
of water that is recharged into the
water tables. On some farms
tables farms,
significant rises in water tables
may, over time, affect the quality
of the land This is especially the
land.
case in WA where on some farms
paddocks at the lower parts of the
landscape can suffer from salinity.
p y

11. The choice of crops on each
Clicking a tile field is easy by using the pull
allows for down list. Then comes the
change of land choice of the amount of
use of the inputs to be applied (e.g.
field. fertiliser). On the right hand
side,
side the revenues costs and
revenues,
gross margins of the selected
land use are displayed.

12. You can manage the field in
an alley configuration with a
combination of trees and
agriculture. For instance
choose oil mallees in belts
with wheat in the inter-rows.
inter rows.
It is possible to i t ll
i ibl t install
drains in fields that are
next to the creek.
Installing drains comes
g
at a cost and may if
done at the right time
and place reduce water
tables and prevent
salinity and
waterlogging.

13. Forward contracts for grains provide opportunities for managing the risk
associated with commodity prices. However, this can also increase risk if
adopted carelessly. Two opportunities are available to hedge the price of
d t d l l T t iti il bl t h d th i f
grains. The first is prior to seeding and the second opportunity to take out
forward contracts is during the growing period

14. The fi
Th financial impact of
i li t f
plans and decisions are
shown. The state of the
farm’s assets and
liabilities and the
cashflow of the
business are shown in
detail in this dedicated
screen.

15. Key indicators of the performance of the farm are appended to the records page as the
workshop proceeds. This page displays of summary report of land use selected by the
grower for individual years, condition of the land at the end of the season, profit and
loss, and the closing equity. The chart provides a quick graphical overview of the
variation in profit and loss and change in the state of assets and liabilities.

16. Systems
S stems Approach in FFB
 Mimics running a simplified rural business over 25 y
g p years
 Integrates biological, hydrological and economic factors
 Limits time, credit, rainfall and land use choice
 Has inflation and cost price squeeze trends built in
 Includes changes and chances of climate and markets
 Gives choice of enterprises for scarce resources
 includes farming system drivers – interactions like:
– N-Fix and disease break in rotation of cereal and break crops
– Shelter and competition effect of trees in the proximity of crops

17. Woody perennials in the broadacre
farming systems of southern Australia
 Decide where, when and how many hectares of each tree type
to grow.
grow
 Consider:
– Water use of trees: interaction between trees and ground water;
– Prospects for marketable products like
• Wood
• Biomass
• Sequestered CO2 and permits
• Oil
– Competition and shelter benefits of trees
– Opportunity cost of land - profitability of trees compared to crops
like h t
lik wheat
– Effect on cash flow, peak debt and payback period

18. Credits and Acknowledgements
Ackno ledgements
I thank the following contributors very much
for making FFB what it is today.
– Quenten Thomas
– Don Cooper
– Ross Kingwell
– David Pannell
D id P ll