Farmers should expect to see increasing contracting prices as fuel, labour and machinery costs escalate, the National Association of Agricultural Contractors has said.
The NAAC, which released its new price guide today (17 May), said prices were rising due to record fuel prices as well as surging costs of labour and machinery.
The Contracting Prices Survey provides the UK national average prices, to help benchmarking for contractors and farmers.
Figures show that over 90% of farmers use a contractor, and the NAAC is the only trade association to represent land-based contractors.
The survey was carried out based on a pound per litre for fuel, with contractors advised to calculate their fees carefully to ensure they are covering costs and can make a margin.
The survey is only an average figure and farmers should expect their contractors’ prices to vary, the NAAC said, plus a fuel surcharge may be necessary if prices continue to fluctuate.
Jill Hewitt, NAAC chief executive said: "These are difficult times for everyone, and it is vital that contractors work closely with their customers to ensure all businesses can remain viable and productive.
"Profit must not be a dirty word if contractors are to keep pace with new technology, training and investment in their businesses, to supply the professionalism, machines and skills that are increasingly being demanded.’
It comes as the NAAC and Andersons Consulting recently launched an online pricing tool for its membership, to allow contractors to evaluate each operation, considering all costs.
The tool takes account of numerous variables such as depreciation, repair costs of individual machines, yard costs, insurance and office staff.