To-date only farmers in Western Australia have used the "Odeum Finance" service, however it is available to farm related businesses across the country. The company’s National Category and Farms Manager, Jason Marais, says the company identified a need to assist like-minded farm businesses, which are considered high risk by the major banks - and getting funding is not always an easy task.
"We have provided funds predominantly to vegetable farmers throughout Western Australia," he said. "The funding we provide is intended for infrastructure upgrades, expansion and innovation on farm though we have seen a higher percentage of funding required for seed/seedling costs, chemicals and fertilizers recently, due to very low prices on an unsustainable season last financial year for most growers. A lot of loans have gone out to help fund the generic start-up costs in order to just get going for the season ahead."
Mr Marais adds that there was a demand in this space, especially in understanding the difficulties and realising that there are many uncontrollable variables in farming.
"Variables will always include unforeseen adverse weather events, climate change, supply and demand on a national scale influencing market volatility and returns on investment," Mr Marais said. "Farming is volatile and that’s why we support innovation so that farmers can grow in as much of a controlled environment as possible."
The aim is to provide more options and help farmers grow their businesses. Each loan is evaluated and tailored to suit each individual dependent on their circumstances, with greater flexibility around how Odeum Finance funds farmers.
"We take into consideration factors like peak production on the farms at certain times of the season, unforeseen weather anomalies that may disable payback of the loan for a certain period, having an understanding around farming as we do to make it easier and more flexible," Mr Marais said. "Other examples would be contractual farming which gives the farmer an outlet for marketing their produce through Odeum Farms or even starting new joint ventures and/or supply partnerships."
Odeum say they believe innovation should be nurtured, as farming businesses learn a lot from each other, and Mr Marais adds feedback from farmers for this new arm of the company has been positive, with many success stories.
"One example of this is a farmer based in Carabooda who started with a 10-acre farm 4 years ago - today he now has 3 farms totalling 155 acres of land," he said. "It has additional infrastructure added like a 6 million kilolitre capacity dam, upgraded pumps and irrigation to keep up with bigger scale farming including tractors, trucks etc. and product specific grading and washing facilities. Over 4 years his business has grown 212% or 53% year on year."
Production-wise, Odeum has seen harvested volumes lift 24 per cent this winter, although with general price deflation experienced across vegetable crops, it has experienced 4.3 per cent growth.
For more information:Jason Marais
Odeum Farms
Phone: +61 8 9256 8100