State Climatologist talks southeast MN weather

The weather throughout fall and during the transition to winter can only be described as interesting. It’s been awhile since I was doing play-by-play for a high school football game during early November and actually had to take my winter jacket off because the press box was actually quite comfortable. I would imagine outside chores have been much less taxing during the nice fall weather too.

Conditions are going to change at some point. We know that here in southeast Minnesota. Colder weather and snow will be coming starting next week, but the question is how cold and how much?

State Climatologist Mark Seeley talks southeast Minnesota weather

Mark Seeley is a climatologist with the University of Minnesota’s Department of Soil, Water, and Climate. (photo from mprnews.org)

Mark Seeley of the University of Minnesota Department of Soil, Water, and Climate. He’s a professor, a climatologist, and the main guy Minnesota media has turned to with weather questions for decades. I first met Mark while at KLGR radio in Redwood Falls. He was at the annual Farmfest event down the road near Morgan, Minnesota, and a fellow broadcaster said I needed to talk to Mark if I wanted to do a weather segment.

My most recent weather assignment comes from my freelance reporting job with Bluff Country News Group. We wanted to know what the upcoming winter would look like so I gave Mark a call and had a visit. The 2016 calendar year weather conditions in southeast Minnesota have been record-setting, with too much heat and moisture. I wanted to know how much heat and moisture have hit the area and this is what Mark had to say:

EWG: voluntary conservation isn’t enough

Seven years in the making, EWG’s Conservation Database allows Americans to see exactly where billions of dollars in conservation funding have gone. The data obtained through Freedom of Information Act requests, is broken down by county.

“Used wisely and with the right incentives, farm conservation programs are making a difference in protecting our health, and improving our quality of life and the environment,” said Craig Cox, EWG Senior Vice President for Agriculture and Natural Resources. “But we need to focus taxpayer dollars on getting the most effective practices in the right places to address the most urgent threats.”

Data obtained by the EWG through FOIA requests show where federal conservation dollars have been spent on projects, including cover crops.

Data obtained by the EWG through FOIA requests show where federal conservation dollars have been spent on projects, including cover crops.

The data, obtained through 28 FOIA requests over seven years, show that since 2005 farmers and landowners have received $29.8 billion in payments through four initiatives funded by Congress and administered by USDA.

-Wildlife Habitat Incentive Program, $318 million

-Conservation Reserve Program, $20 billion

-Environmental Quality Incentives Program, $7.4 billion

-Conservation Stewardship Program, $2.2 billion

The data confirm the growing recognition that voluntary programs alone are insufficient. Voluntary programs in the federal farm bill can play an important role, but they aren’t leading to clean water, clean air and a healthy environment.

“It’s more than fair to expect farmers and landowners to do more to protect the environment in return for the generous farm and insurance subsidies they receive,” Cox said. “Americans across the country are seeing the price of farm pollution firsthand. It’s time for Congress to deliver a return on their tax dollars by requiring farmers who take money from these programs to do more to protect the environment and public health.”

Source: EWG

This article can be found at farmfutures.com

MN farmers See For Yourself in Vietnam

Minnesota farmers See For Yourself

Doug Pohlman (right) of Lakefield, Minn., thanks a Vietnamese poultry farmer for hosting the Minnesota Soybean Research & Promotion Council’s See For Yourself delegation. Thirteen Minnesota farmers toured parts of Vietnam to assess soybean checkoff investments in the country. (Contributed photo)

The Minnesota Soybean Research and Promotion Council (MSR&PC) went to the Far East for it’s most recent See For Yourself trip. A delegation of farmers took a tour of Vietnam to see firsthand how the MSR&PC investments in the country are paying off for American soybean farmers.

Kevin Paap is a farmer from Garden City and the Minnesota Farm Bureau Federation President. He also serves on behalf of the American Farm Bureau Federation (AFBF) on Soy Insights (formerly Soy 20-20), a strategic planning group looking at markets and demand. He said Vietnam is one of the world’s fastest emerging markets.

“With being involved in the AFBF Trade Advisory Committee as Chair,” Paap said, “we’ve been very active in trade talks, including the Trans Pacific Partnership, the See For Yourself was a good opportunity to mesh all those things together.”

He said trade missions are most successful when put together by people with what he called “boots on the ground.” It’s important that people who know the countries, such as the US Meat Export Federation (USMEF) and the US Soybean Export Council (USSEC), help with lining up the trips. That way, Paap said they wouldn’t turn into sightseeing trips.

Paap said describing Vietnam as an emerging market for agricultural goods might catch some people by surprise, but a number of different factors make it a true statement.

“It’s an emerging market because it’s the 13th most populous country in the world,” Paap said, “and that number is increasing by about 1 percent per year. It’s also the eighth most populous country in Asia. They’re only the 32nd largest economy in the world, but they’re growing.”

Vietnam is the 11th largest export market for American agricultural products. They import 70 percent of their livestock feed ingredients, which means they can’t raise it themselves. They also pay a lot for their own food.

“They spend 65 percent of their incomes on food,” Paap said. “They don’t necessarily want more calories, but better calories in their food, before they spend their money on a car or a house. They’d like to eat something more than rice 3 times a day.”

The other opportunity for livestock feed comes from strong Vietnamese pork production. It may come as a surprise, but Vietnam ranks sixth overall in world hog production and seventh in the world in pork consumption.

Paap called the “See For Yourself” trips that most of the checkoff organizations are now hosting a great opportunity for farmers to see how their checkoff dollars are invested, both locally and overseas.

“It’s tough to see opportunities overseas when you aren’t there,” Paap said, “and the opportunities are there in international marketing. Until you not only see, but also hear from, those folks with boots on the ground, it’s exciting to know they want better food.

“They can’t grow the crops themselves and they’re very accepting of biotechnology,” Paap said. “With limited land, biotechnology is the only way they can grow more on the land they do have.”

Minnesota farmers See For Yourself

Thirteen Minnesota farmers toured Vietnam to evaluate the work of the Minnesota Soybean Research & Promotion Council, the elected board of Minnesota farmers who direct investments of soybean checkoff money to open new markets, create new uses, educate farmers and non-farmers and promote soybeans. (Contributed photo)

First impressions for farmers on overseas trips can vary greatly. Ben Storm farms near Dover, in Olmsted County, and went along on the See For Yourself trip to Vietnam. He said the first thing that jumped out at him when he stepped foot in the country.

“The modernization,” Storm said.   “The feed mill we toured look all new with modern technology. You might have thought you were in a feed mill in the United States. The poultry farm we toured had 20,000 laying hens. The only difference between that and a barn in the US was the hens are hand fed and the eggs are picked by hand.”

He said the Bungee soybean crushing facility actually prefers American soybeans to South American beans. American soybeans, particularly from Minnesota, arrive at their plant with much less moisture and heat damage.

Overseas trips to Asian marketing partners are very important. Asian businesses typically place a very high value on face-to-face interaction.

“You’ve got to have those relationships and know each other before they’re willing to do business with you. It’s a much different culture than in the US.”

An American farmer back home who’s never been on one of these trips may be saying ‘how does this benefit me?’ The 13 Minnesota farmers on the trip saw firsthand how important and effective these trips are.

13 Minnesota farmers See For Yourself

Ben Storm (left) of Dover, Minn., and Kevin Paap of Garden City, Minn., tour a market in Hanoi, Vietnam. Paap and Storm were guests of the Minnesota Soybean Research & Promotion Council, which sent a delegation of 13 Minnesota farmers to Vietnam as part of its See For Yourself program. (Contributed photo)

“It just so happened that Keith Schrader (Nerstand, MN), the Chairman of the MSR&PC was on the trip,” said Kim Nill, Minnesota Soybean Director of Market Development. “He was the leader of this trip. When he walked into place after place over there, it was ‘Oh, hi Mr. Schrader,’ and ‘How good to see you again,’ et cetera. Keith has been there a couple times and also been a part of USSEC projects to bring Vietnamese here.”

Nill added, “It was surprising, even to me, to see how many of them already knew Keith and greeted him warmly.”

In terms of actual business conversations, the 13 farmers also heard firsthand how USSEC investments overseas pay off in terms of increasing market demand and buyer loyalty as well. Nill said the 13 farmers asked very probing questions of overseas customers and partners.

“For example, they would say ‘Okay Mr. Soybean Mill operator, we’ve heard about what the USSEC investment did to help you get your mill built, or maybe improved it’s capacity. Has that made you more likely to purchase soybeans from the United States?’ Then, they’d hear the response of that feed mill owner or swine farm operator, and the answer was obviously, yes.”

These trips do add to the bottom line for American farmers. USSEC recently hired an economics expert from Texas A&M University to run the numbers to see how much impact these types of trips have to the American agricultural economy.

“They do go through the calculations to see what the impact of the checkoff expenditures is to the bottom line of soybean producers,” Nill said. “Their latest determination is that for every 1 dollar of checkoff funds spent on projects like the Vietnam trip, it returns 7 dollar net benefit back to the boots on the ground farmers in the United States.”

Tran Trong Chien is the USSEC Country Representative for Vietnam, and Ben Storm said he and the rest of the staff do a great job promoting American soybeans.

“Everywhere he went, people knew who he was,” Storm said. “It was pretty obvious he’s done a great job getting to know people and promoting American products. I was extremely pleased with how we’re investing our money over there.”

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Farmers looking to use drone technology

drone technology on the farm

Farmers across America are waiting for the chance to add drone technology to their farm operations as a means of being more efficient, especially when it comes to scouting crops for disease. (photo from americasbackbone.com)

Drone technology has the potential to change the way farmers scout their fields for things like disease issues and pest pressure. The technology appears to have come a long way in a relatively short time, but there’s a more basic question to ask first:

How does it work?

“If you’re a farmer who wants to use a drone, it’s like having a 200 foot ladder to survey your field,” said Ian Smith, Business Development and Marketing Manager for DroneDeploy of San Francisco, California. “Usually a farmer would take some pictures of the field, but just pictures won’t get you a lot of useful information.”

DroneDeploy drone technology

DroneDeploy of San Francisco is a company looking to expand into the agricultural market as farmers look for more efficient methods of running their farms. (photo from twitter.com)

Smith added, “Instead, you need to create maps.”

The Drone Deploy software includes an app for smartphones.

“You can connect your smartphone directly to the drone with the app,” Smith said. “Our software lets you create aerial maps, 3D models, and images of your entire field. The images will be zoomable, high quality, and high resolution.”

The smartphone is hooked into the drone control unit through a USB port.

“When you open the app up, it’s connected to the drone,” Smith said. “You then draw on a base layer map and your drone’s GPS location shows up, similar to what you’d see on Google Maps to figure out where you are. Our app allows you to draw boundaries on a map that will show the drone where to go and take pictures.”

Basically, the farmer drags the corners of a box to outline the area to survey, and hits okay. A split second later, the software draws up a flight plan.

“The drone runs through a few flight checks, and then it automatically takes off straight up into the air,” Smith said. “It then starts to fly through the designated area and takes pictures. It surveys the field through waypoints on the map, getting good overlap between pictures. It then lands in the exact spot it took off from.”

He said the farmer never has to touch the drone’s joystick. The app pilots the machine automatically.

“When the drone lands,” Smith said, “you pull an SD card out of the drone. It’s similar to a card you’d find in a digital camera. You take it out of the drone and pop it in your computer, where you upload all those images to the Drone Deploy system. The system uses a photogrammetric stitching process to bring all of the pictures together into one high quality image.

“It’s basically like having your own Google map of your farm field,” Smith said.

How high the drone will fly depends upon how much area you need covered in the map.

“There’s a default altitude that we set,” Smith said, “usually 250 feet above ground. Changes depend upon how big your picture needs to be. If you have a 400-acre farm, you’d probably want to fly higher than that because you have more ground to cover.”

Flying higher to cover more ground can actually save on battery life for your drone.

“If you adjust parameters, such as height, with our app, it will update in real time how long that flight is going to take,” Smith said. “If your drone has a battery that lasts 20 minutes, and you adjust it to fly higher, it covers more ground in shorter time. The flight time then will drop in real time, so you make sure you have enough battery for each flight.”

The actual stitching process of your photos is entirely automatic.

“Even when we’re all asleep here in San Francisco (company headquarters) and someone is making a map in Australia,” Smith said, “it’s all automated. No one has to be awake at all.”

Once the images are uploaded, then it’s time for a farmer to wait.

“You go grab a cup of coffee, or whatever,” Smith said. “Depending upon the size and quality of the images you collect, in a couple hours, you’ll get an email saying your map is done. Once you click on the link, you’re right in your high quality, high resolution map that same day you took the pictures.”

He said same-day data is important for farmers, as things can literally change overnight due to events like severe weather.

Turnaround time on getting the stitching process done rarely takes more than a few hours.

“It all depends on things like how many pixels are in each image,” Smith said. “For example, a high end camera can take 60-75 seconds per image to process, so if you throw around 50 images in there, you’re probably looking at around an hour turnaround time.”

Even if the system is processing a large number of maps, you’ll still get your map back in a short time.

“With the horsepower we have in our big servers,” Smith said, “even if we’re processing 50 maps, you’ll still get your map back relatively quickly.”

High-end drones can run up to $3,000, but he said you don’t have to spend that much to get a good map, but there is a baseline recommendation.

“The lowest you may want to go if you’re getting into this today is probably $1,000,” Smith said. “However, 6 to 8 months from now, you’ll probably be able to spend $800, and a couple years from now, it’ll be lower than that.”

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Kuschels Retire from National Committee at YF&R Conference

YF&R national meeting members

A strong group of Minnesotans attended the recent Young Farmer and Rancher Conference. Minnesota’s Miles and Sarah Kuschel recently completed a two year term on the national committee. (Photo from Facebook.com/MnFarmBureau

Young farmer leaders from Minnesota attended the American Farm Bureau Federation (AFBF) Young Farmers and Ranchers (YF&R) Conference held in Kansas City, Missouri, February 12-15. Miles and Sarah Kuschel of Cass County were among the nearly 1,100 participants who attended the conference.

This also marked the completion of the Kuschels term on the AFBF YF&R Committee. The couple held numerous responsibilities throughout the year, including assisting with planning and implementation of this year’s conference. Miles also served as vice chair of the committee this past year. The Kuschels served on the committee for two years and were recognized for this on February 14.

“We had a great time representing Minnesota on the committee. Thank you to everyone we were able to share this experience with, and those who helped us along the way,” said the Kuschels.

The AFBF YF&R Committee donated $500 to Bill Brodie of the All American Beef Battalion to aid in their efforts of providing steak dinners to service men and women and their families across the country. Brodie is a Vietnam Veteran who is passionate about providing something special for those who defend our country.

The Kuschels also visited the Ronald McDonald House with Miss America 2016 Betty Cantrell. The American Farm Bureau Foundation for Agriculture has partnered with Cantrell on her platform, “Healthy Children, Strong America.” The partnership is working with the American Farm Bureau Foundation for Agriculture book of the year, First Peas to the Table.

Collegiate Discussion Meet

Ethan Dado, University of Minnesota student from Amery, Wisconsin and winner of the MFBF Collegiate Discussion Meet, finished in the Sweet Sixteen of the National YF&R Collegiate Discussion Meet on February 14 competing against 52 other YF&Rs. Katie Schmitt, University of Minnesota student from Rice in Benton County, also represented Minnesota in the competition.

Attendee Highlights

Attendees heard from keynote speakers Jason Brown, former NFL football player; Roger Rickard, advocacy professional; Kelly Barnes, motivational speaker; and Miss America 2016 Betty Cantrell. Attendees also had the opportunity to tour the Kansas City, Missouri area.

Conference attendees included: Miles and Sarah Kuschel, Cass County; Amanda Durow, Dakota County; Pete and Jenni Henslin, Dodge County; and Collegiate Discussion Meet participants Ethan Dado and Katie Schmitt.

Minnesota_Farm_Bureau_Logo_345x143Minnesota Farm Bureau Federation represents Farmers • Families • Food is comprised of 78 local Farm Bureaus across Minnesota. Members make their views known to political leaders, state government officials, special interest groups and the general public. Programs for young farmers and ranchers help develop leadership skills and improve farm management. Promotion and Education Committee members work with programs such as Ag in the Classroom and safety education for children. Join Farm Bureau today and support our efforts to serve as an advocate for rural Minnesota, www.fbmn.org.

 

For more information on the Minnesota Farm Bureau log onto www.fbmn.orgwww.Facebook.com/MNFarmBureau or www.Twitter.com/MNFarmBureau.

SE Minnesota farmers have grain to sell

With the current lower commodity prices and no real significant bump in the short-term forecast, careful planning has become more important than ever for farmers to stay in business.

Balancing lower prices for products farmers produce against the fact that input costs to produce those products haven’t come down yet requires more juggling than in recent seasons. Among some of the more significant costs is land rental, which is squeezing the bottom line of renters all over Minnesota and across the country.

Farmers have grain to sell

Lisa Behnken is a crops specialist with the University of Minnesota Extension office in Rochester. (Photo from AgriNews.com)

“Boy, is that a difficult one (to control),” said Lisa Behnken, a Crops Specialist at the University of Minnesota Extension Service in Rochester. “Rents keep going up and it’s very hard to renegotiate to bring those costs back down. It’s certainly a big part of the equation.

The high costs of renting land may lead to some tough business decisions.   Farmers may shuffle some land around, or even let a particular piece of land go back and not rent it anymore.

“We’ll see if people can do that (make things balance out),” Behnken said, “or if they’re going to let land go and back away from it because they can’t afford that. You may see some land changing hands because of the cost.”

With corn and soybean prices in the tank, are there other opportunities farmers may be looking at for profit? What about small grains?

“It all goes back to where their markets are,” Behnken said. “We have a good group with Extension that do workshops on small grains here in southern Minnesota and a good group of core farmers that grow small grains. They’ve got markets that they’re working with and are locked into.”

She added, “It can be successful, but it’s not just something you’re going to jump into. We don’t have the sell-points here. You need to have convenient places where you’re going to market it to. They don’t buy at every single elevator. It doesn’t mean you can’t do it, you just have to get everything in order, from planting it to marketing it.”

Behnken, who received her Master’s Degree in Crop and Weed Sciences from North Dakota State University, said farmers don’t want to be caught with a lot of grain in their bins in the summer and nowhere to take it.

Speaking of grain stuck in bins, farmers in southeast Minnesota still have a lot of grain to move from the 2015 harvest. Low prices at harvest made farmers very reluctant to sell grain that wasn’t forward contracted.

farmers have a lot of grain to sell

While exact numbers aren’t available, Lisa Behnken of the University of Minnesota Extension office in Rochester said there is quite a bit of grain in area bins waiting to be sold. (Photo from brockgrain.com)

“There are definitely crops to be sold,” Behnken said. “Some probably go forward contracted, but farmers don’t forward contract everything. Prices were down at harvest, so farmers didn’t sell right then, so it goes straight in the bin.”

While it’s important for commodity farmers to get their books in order, it’s equally important for livestock producers to watch their costs too, thanks to a recent run of lower prices.

“Cattle prices are softer,” said Behnken, “but the good side of that is they’re feeding animals much cheaper feed. However, they’re end product has also come down in price too.”

Do lower cattle prices mean it’s time for America’s livestock farmers to start expanding the beef herd? She said it all depends on your books and cash flow that your banker sees in those books.

“It’s all about operating money,” Behnken said. “You still have to go to the bank and make this whole thing cash flow. If I’m in the market to buy some feeders, I still have to have the cash to buy those feeders. Even if a farmer is raising his own corn to feed the animals, he still has to have cash necessary to buy the feeders.”

Cash flow. It’s more important than it’s been in many years, and it’ll determine what kind of decisions farmer make this year, and whether or not they stay in business.

“For some, it’s where their debt load is at,” said Behnken. “What’s my percentage of debt? If you have a more solid equity base, that’s a little different than if you’re highly leveraged. Then, it’s a whole different ballgame.”

 

 

 

 

 

Why FFA and agriculture are the Best Things Ever

By: Talisa Smith

A recent article by PETA described FFA as “lame AF.” Now, I see more and more posts from people who used to be in FFA agreeing with PETA. You folks that changed your mind, I’m betting you only did it because other people did. That means you are not, and never were, a proud FFA member.

Let me start off by introducing myself. My name is Talisa Smith. I’m 16 years old, and from Fort Pierre, South Dakota. Right now I’m a sophomore at Stanley County High School. I have been a FFA member for three years now, and I can say I would never go back in time and change my mind about becoming one

I am my chapter’s reporter and am stationed by the flag when we hold meetings. Much as the flag covers the United States of America, I strive to inform every man, woman and child I can that FFA is a national organization. It reaches from the state of Alaska to Puerto Rico, and Maine to Hawaii. I am there to let everyone know what goes on in the chapter. So I’m going to tell you what FFA is to me and what my side of the story is.

Many people have read this article about how we are a lame organization. One thing that most people probably don’t realize is that those pictures they have are entirely out of context. What they said is wrong and they clearly don’t know what they are talking about.

In one point that they made, it states FFA teaches kids to raise animals and send them to the slaughterhouse to have them cut apart while they are still living. Well yes, these animals do die so that people don’t starve. However, the methods that they say they use to put the animals down are wrong.

In a slaughterhouse the animals are put down with a stun gun to the head because it’s painless to the animal and quick. The other way is they are put down is by a gas. To make sure that they are dead, workers will drain the rest of the blood so the animals don’t suffer. Then they are butchered for the meat so that the world can have food.

They had also mentioned that sheep tails are cut off and ears are pierced without using painkillers. Cutting the tails off is a process is called docking and it is for the sheep’s benefit. If we don’t do this, the tails would end up getting dirty and infection is a good possibility. We dock the tails so the sheep can stay healthy and not get sick. They don’t feel anything but a little pinch when they do this.  When we pierce their ears, it’s basically a small hole, just as cows get tags in their ear to tell them apart.

The next allegation is we steal calves away from their mothers. We bottle feed those calves instead of giving them milk from the cow. The milk we get from the cows is not just used for drinking. That is used for all sorts of thing like, cottage cheese, cheese, and ice cream. So if we take away that milk, you are going to take away ice cream. Do that, and you have to tell your kids that you are the reason that they can’t have any more ice cream. Now, to me, that just doesn’t sound right.

FFA and agriculture

Stanley County FFA chapter members volunteer to clean up local emergency vehicles as part of summer camp activities. (Contributed photo)

Another point in the article says that the skills needed to stand up and talk in front of a group are lame, uncool, and have no purpose in the world anymore. The article says people should just stick to their phones. What happens when you want a job and you can’t talk to someone in person? You can’t talk only through texting. I can tell you this: you will not get hired and you will not find a job if you can’t have a decent face-to-face conversation.

The article said it’s cooler to judge people instead of knowing different kinds of livestock and other animals. Well you are now saying that it is ok to belittle people and lower their self-confidence. FFA is trying to stop that in the first place.

FFA and agriculture

Talisa Smith of the Stanley County FFA chapter poses with the Peterson brothers, farmers who are nationally known Ag advocates. They made an appearance at a recent South Dakota State FFA convention. (contributed photo)

They had stated that it is better to be a follower than it is be different and stand up to be a leader. You are going to tell people that it’s better to act and follow someone than to stand up and be yourself? I am proud of who I am and I’m not afraid to stand up and be a leader that may change the world for the better.

Many FFA members take care of animals and know how to feed them and give them the right medicine so they don’t get sick. We want our animals to be the healthiest they can be. We take pride in this because we are feeding the world while doing something that we love to do. Some people are saying that’s dumb. You shouldn’t do that. Instead, be more like PETA and just talk about caring for animals, and not actually doing it. Well if nobody raises livestock, then what happens? We have no food if farmers just stop working. Great: We got everyone to stop like you wanted, but guess what? We have no food for anyone. Now what do you want us to do? We’ll see FFA members and the farmers they might grow up to be as where you’ll get your food from, so we need them.  Did you know that 1 farmer feeds at least 100 people, if not more?

 

FFA and agriculture

National FFA officers often take over local classes to teach life skills all FFA members can use. (contributed photo)

FFA doesn’t just teach you about agriculture. It teaches you life skills that you can use everywhere. You will meet great people along the way that you never would have met in the first place. There are 692,327 members right now, and 7757 chapters in the United States, Puerto Rico and the Virgin Islands. Those numbers are growing each year and I am so glad for that. Our mission is FFA makes a positive difference in the lives of students by developing their potential for premier leadership, personal growth and career success through agricultural education. And our motto is Learning to Do, Doing to Learn, Earning to Live, Living to Serve. As an FFA member I am proud to live by this with everything I’m doing. I don’t think that most people realize is that agriculture is everywhere and is in almost all the jobs that we have.

So the next time someone wants to say that FFA is lame AF and belittle FFA and agriculture, make sure you do some research on it so you know what you’re talking about. You are also offending everyone involved because you information is wrong and hurtful.

 

 

Famers assessing their finances for 2016

January is a time when farmers are typically doing paperwork, looking back at 2015 ahead of the upcoming tax season.

What some may find is their books don’t necessarily balance they way they want. The good news is, it’s possible to make better decisions in a difficult Ag economy if you have a clear understanding of where you’re operation is at financially.

Rob Holcomb wants farmers to keep a sharp eye on their finances heading into 2016.

Rob Holcomb is a University of Minnesota Extension Educator, specializing in Ag Business Management over in the Marshall regional office. (Photo from extension.umn.edu)

“What I’m seeing happening right now is people in the habit of doing a FINPACK (software from the Center for Farm Financial Management) analysis,” said Rob Holcomb, Ag Business Educator for the University of Minnesota Extension Service, “including balance sheets and income statements, are really analyzing what happened in 2015.”

He added, “A lot of people are doing analysis, and unless they’ve got some special circumstances, farm returns are due on March 1.”

Dave Bau is encouraging farmers to get their finances in line.

Dave Bau is a University of Minnesota Extension Educator also specializing in Ag Business Management, and based in the Worthington office.

Looking ahead to 2016, Holcomb said the financial condition on farms is a mixed bag.

“We had people last year that had big trouble managing the tax bill,” Holcomb said. “What led to this challenge was the buildup of $8 per bushel corn, which caused more trouble than first thought. You hate to be negative about it, but I knew it would cause trouble down the line, and that’s what we’re finding now.”

He said certain farmers were doing a lot to avoid paying some taxes, like deferring income to the next year.

“They were also maxing out on pre-payments,” Holcomb said. “The problem is, a lot of farmers were rolling these massive deferred tax liabilities forward every year, even though they’re showing a loss. They may have a loss over the last couple years on their accrued farm income, but they still have this cash they have to deal with, because if they don’t do it, they have a monstrous tax bill.”

He said a lack of steady farm income leads to an obvious problem in that situation.

“The challenge is the recent lack of cash flow is such that they can’t afford to have that big tax bill,” Holcomb said. “In a sense, they’ve backed themselves into a corner with their tax problem.

“But that’s not everybody,” he added. “Some folks have been paying a little more as they go and didn’t have a big aversion to paying taxes, I think those folks are in much better shape.”

Holcomb said one of the big buzzwords in the Ag industry is working capital.

“It’s a current and intermediate cushion that the farmer has,” Holcomb said. “The more working capital you have, the better. Unfortunately, we’ve been burning some working capital over the last couple years. That’s probably the thing that lenders are getting the most squeamish about right now.

The lack of working capital on some farms is showing signs of getting serious.

“I got a call last week from a banker in my area that was asking about lender mediation,” Holcomb said. “That conversation can only be the result of one thing, which is a farmer out there that the bank is getting ready to pull the plug on.

“That means there are farm folks who could be in tough shape,” he added.

He’s especially worried about young farmers.

“When the $8 per bushel corn began coming down,” Holcomb said, “some of the younger guys were paying ridiculous land rental rates to try and get their hands on some acres to work. The problem is they’ve got the least ability to weather out low prices because they don’t have a lot of working capital. They have a cost structure that’s not sustainable.”

High land rental rates are squeezing farmers finances.

The high cost of land rental rates in farm lease contracts are putting a heavier squeeze on farmers and their financial bottom line than we’ve seen in several years. (photo from americasnewfarmers.org)

Rents are beginning to come down, but they have a ways to go to ensure profitability for both farmers and landowners.

Rent is the largest input cost for corn and soybeans,” said Dave Bau, University of Minnesota Ag Business Management Educator in Worthington. “Rents are going down, but at current corn and bean prices, they should be around $100 to $125 an acre. Even base rents on flexible leases are still much higher than this.”

There is still pressure on farmers for land rents to remain very high for at least one more year.

“Farmers are doing more and more flexible agreements with a base rent and additional rent if prices improve,” Bau said. “With other input costs not coming down significantly, break-even prices for corn are $3.80 to $4.00 for corn, and $9.50 to $10 for soybeans.”

Bau adds, “Cash prices currently are around $3.40 for corn, and $8.25 for soybeans.”

With this much economic gloom ahead, what’s the key to surviving the downturn in 2016?

“I think the number one thing is you have to get your cost structure in line,” Holcomb said. “Land rent is one of those high costs that can be negotiated. $400 land rent won’t work right now.”

One of the best things farmers can do is figure out where they’re at financially before they make decisions on the year ahead.

“The farmers I fear for the most are the ones that aren’t doing any kind of financial analysis,” Holcomb said. “They have no idea where they’re at. It’s a sad situation when they find out they’re in trouble, and it’s their banker that tells them”

He added, “The smart producers know where they’re at, and that can alleviate a lot of trouble.”

Farmers need to do a better job of marketing their products in 2016.

“There are marketing workshops going on around the state,” Holcomb said, “and I think it’s really important to look at that.”

 

 

 

 

 

 

“Cabin Fever” workshops for farmers offered in St. Cloud

The Minnesota Department of Agriculture is looking to educate farmers who might be suffering from cabin fever this winter.

The Minnesota Department of Agriculture is looking to educate farmers who might be suffering from cabin fever this winter.

The Minnesota Department of Agriculture will offer four “Cabin Fever” workshops for all farmers on January 7 in St. Cloud. The variety of sessions is designed for people interested in exploring new ideas during the short days of winter.

Registration is open: www.mda.state.mn.us/cabinfever. Participants can choose from four workshops. All will be held at the River’s Edge Convention Center.

 

  • Passive Solar Deep Winter Greenhouses – is all about serious season extension. You’ll learn how to design, construct, finance, and manage greenhouses to produce fresh market crops; even in the dead of winter. Experienced growers and university resource people will lead this workshop. (Full-day)

 

  • Practical Homeopathy – this livestock health care practice interests more and more swine, beef, and dairy producers who want to reduce reliance on antibiotics and medications. This interactive session will be suitable for both beginners and people with some homeopathy experience. You’ll work through a number of actual cases. Pennsylvania Veterinarian Susan Beal will teach the course. (Full-day)

 

  • Transitioning to Organic for Field Crop Producers – organic food sales continue to increase at double digit rates. This session hits the fundamentals of successful organic production. It will emphasize strategies for producers to weather the 36-month transition period organic typically requires. (Full-day)

 

  • Introduction to Perennial Fruits – Minnesotans are often surprised at the wide variety of fruits able to thrive in our climate; from the common to the unusual. Whether you’re interested in growing fruit for market or for home use, you’ll learn about species and varieties, site selection, pollination requirements, sources for planting stock, and tips to get plantings and orchards off to a vigorous start. (Half-day)

Session details and a registration link are posted at www.mda.state.mn.us/cabinfever. Full day courses run 9:00 a.m. – 4:30 p.m. and cost $50. There is a $15 discount for additional people who register together and attend the same workshop. The half-day fruit workshop runs from 1:30 p.m. – 4:30 p.m. and costs $25.

Farmer workshops in St. Cloud

Farmers who might be looking for something to do are invited to some educational classes in January. (Photo from ksoo.com)

We strongly encourage you to register online at www.mda.state.mn.us/cabinfever or by phone (call Stephen at 651-201-6012) because space for all workshops is limited. All reservations are payable at the door with cash, check, Visa, or Mastercard.

WOTUS rule postponed nationwide

Here’s a conversation on the 6th Circuit Court of Appeals staying the implementation of the controversial Waters of the US Rule (WOTUS):

 

WOTUS

The EPA’s implementation of the Waters of the US Rule was stayed nationwide by the 6th Circuit Court of Appeals today. (Photo from alaskapolicyforum.org)

The Sixth Circuit has just stayed the Waters of the United States (WOTUS) rule nationwide, by a 2-1 vote, until it determines whether it has jurisdiction over the petitions for review.  The majority found a substantial possibility of success on both merits grounds (that the rule does not comport with even Justice Kennedy’s Rapanos opinion) and procedural grounds (that significant changes in the rule were never put to notice and comment).

The order is, “The Clean Water Rule is hereby STAYED, nationwide, pending further order of the court.”

A stay has the same practical effect as an injunction – it prevents the EPA/Corps from implementing the rule.

Expect the stay to last until the 6th Circuit makes a decision regarding the jurisdictional issue, which is expected sometime in November.

Here’s the link to the story on KLGR radio’s website:

http://www.myklgr.com/2015/10/09/6th-circuit-court-stays-wotus-rule-nationwide/

Here’s a video from the Kansas Farm Bureau featuring Paul Schlegel, the Director of Environment and Energy Policy at the American Farm Bureau Federation in Washington, D.C.