55 Years And Counting From The Tractor Seat

By bill whitman

 The next few months are going to test the will of every one of us involved with farming. Our families are going to question why we continue to do without, counting on next year to make the difference. 

I remember when lenders believed “risk management” on every segment of our industry was the answer. I wonder now how they suggest we deal with losing money on every acre we plant due to crop prices well below breakeven. Anticipating that some non-agricultural readers may read this article, I’ll add that in my opinion, I hope “fair trade” is the result of the current economic efforts. To that same audience, when you hear that we’re receiving government subsidies you’ll need to understand that when you’re losing $120-$160 per acre, the $30-$40 contained in the December Farm Bill hardly does more than simply mitigate a small part of the anticipated loss. 

Add to this the increases in input and equipment costs, and we’re going to have to tighten our belts more than we have had to do in the past couple of decades. Recently, I’ve been talking about how providers of equipment and inputs have been taking advantage of our vulnerability. As I’ve continued to research these issues, I have discovered that these corporations are looking further down the road than we are. I am sure that they are aware of the hard feelings escalating among our farms as we pay inflated prices for inputs and equipment costs. Frankly, they are counting on short term memory to ease these tensions when the market begins to provide adequate income again. Historically they are right. 

Just today I was talking with an Illinois farmer who recently had to have a service call on two of his tractors. When he received his bill, he found that he was charged travel time for two trips rather than the one trip that was actually made. When questioning the charge, he was told that he had two different tractors worked on, therefore, two trip charges. Once again, I’m going to encourage us to look for or get behind the establishment of a non-manufacture repair facility to serve your agriculture community. I’ve mentioned a man in our area who is an engineer, farmer and mechanic, focusing on equipment over 2 decades old. I recently had a tractor repaired at a cost far less than a dealer had quoted. That’s the money we must find and save so we can apply it to other areas of our businesses. 

I want to suggest that we begin to look for ways to manage our businesses that defines a return on investment that includes creating a reserve for times like this. Again, I also think we must look for additional revenue that will help narrow the margin of loss we’re experiencing. I also encourage that we reserve some capital to invest in something that is profitable. I’ve noted that some are returning to raising some cattle on neglected pasture ground. (Someone also mentioned that sheep have a promising profit margin as well however I really don’t have much experience with them). Finding a niche is key. I have a neighbor who has put his three kids through college by raising and selling 10 bred heifers a year. A couple of others raise 4-H livestock. There’s always something extra available if we look for the opportunities around us. Sometimes, often even, it’s the money earned from these enterprises that let us continue in this great industry of agriculture that we’re privileged to be part of.

IndianaAg@bluemarble.net