# Keep On Digging The Hole



## Vol

And it just gets deeper....a catch 22....what's a large acreage cropper to do?

Regards, Mike

http://www.agweb.com/article/as-corn-and-soy-pile-up-heres-why-us-farmers-will-plant-more-blmg/


----------



## Teslan

I guess they have to plant and harvest. If they don't they will end up owing more then if they do. Gotta pay leases and other expenses. Now if you farm without debt (rare I know) you might as well just take the year off from commodity crops. We have let land lie fallow when we had to rotate out of alfalfa for a year rather then plant something that would lead us to just break even.


----------



## swmnhay

The story is reminding me of some in the 80's that left some ground idle,they were far and few between.They were more the bitch and moan type instead of getting off there ass and working a little harder.

There won't be any ground idle here,you could rent it out for $350 if you put it out on bids.


----------



## rjmoses

You know---They just don't get it!

I started planning my 2016 season in the summer of 2015---and I won't see the final results until early 2017---that's about an 18 month lead time. And one heck of a lot can happen in 18 months!

I develop my planting plan and liming requirements around August. I pre-buy my fertilizer and seed in December, I will harvest my hay in June-August, grain in October, but I probably won't sell my grain until January--March(sold last of my corn yesterday) and my hay until January--March.

That is a looooonnnnggg cycle for any business. The cost of capital tied up over 18 months becomes significant. And the risk factor becomes atrocious!!!!

Just thinking......

Ralph


----------



## luke strawwalker

Operating at a loss?? Make it up in volume...

One of the reasons I quit row cropping... getting early 1970's prices while paying late 1990's expenses wasn't making much sense... especially when the system favors the BTO's doing heavy borrowing farming huge acres of rented ground...

With cattle I can control expenses a lot easier... I've sold calves for $2.30 cents and I've sold calves (well, seen Granddad sell calves when I was a kid) for $0.30 cents... and we still made a LITTLE money on 30 cent calves... course if the market is going to pay 30 cents for calves, they're going to GET 30 cent calves-- rangiest, pot bellied little things you ever saw, but that's what happens when you have to cut to the bone to make money...

I sold 90 cent cotton and I sold 25 cent cotton... and when it got to where you have to make nearly 2 bales an acre to BREAK EVEN, with 70 cent cotton (which my old man was selling cotton for 70 cents a pound when I was a wee little kid...) it's time to shift gears...

I sure don't envy these row crop guys this year, for sure... staring down the barrel of dreadfully low prices, huge carryovers and little/no promise of any relief, basically guaranteed to lose money before the planter ever hits the field... plus the usual threat of drought or flood or pestilence, and particularly El Nino/La Nina, it's enough to make you pull your hair out... Thing is, the guys running the big toys and paying the big bills and borrowing big money and renting big acres don't have any choice... those notes on all that shiny new machinery they bought a few years back when everybody was "shitting in high cotton" because farm income was SOOO good, those notes are still coming due... can't afford to fallow anything unless it's ground they own, because rents are still due, and in most places there's a lot of competition for land-- let it go and you'll likely never get it back... besides, gotta have the acres to run through all that shiny new equipment to justify the cost of it and TRY to make break-even, or hopefully a little...

Course, when it's all borrowed money, well, the banker has to do SOMETHING with that money-- so they'll lend to these BTO's KNOWING that they'll probably lose money this year, but what the heck-- it'll roll over for another year til things get better... gotta have the "long view" so to speak, so they'll just "ride it out" and roll it over to next year and hope things improve...

When you own the ground and don't borrow, and pay everything out of pocket, the view becomes much 'shorter'... why we quit row cropping...

I admire the guys that can do it... I never could. Granddad used to borrow from Peter to pay Paul and so forth, roll loans over in bad years and borrow from one bank this year to pay the other bank for last year, etc... I couldn't do it... like a neighbor of mine who used to be a BTO but finally just let it all go except for his home place and two rented farms (which he gets ridiculously low rents on because the "grandpa's" made the family promise never to go up on the rents) told me one time-- "I was about to lose my mind-- I'd pace the floor all night worrying if it'd ever rain, or if the rain would ever stop... worrying about the bills piling up and the notes coming due and the bank payments and selling prices... I was getting ulcers and high blood pressure and about to just lose my mind... So I finally paid everything down or off and let everything go but the home place and two others... I took my life back..." After Grandpa FINALLY paid everything off (and then died a year later) Grandma said, "Well, if we EVER have to borrow money to farm again, that's the day we quit farming!" A motto I live by... as much as possible in my private life and finances as well as the farm...

Best of luck to those guys-- they'll need every bit of it from the sound of it...

Later! OL J R


----------



## Swv.farmer

I hate to see people work hard to loose.
I couldn't stand the stress I would have a mental breakdown.

You would think with low crop prices that you would be able to tell it at the grocery store.

I can't even really tell it at the feed store.


----------



## luke strawwalker

Swv.farmer said:


> I hate to see people work hard to loose.
> I couldn't stand the stress I would have a mental breakdown.
> 
> You would think with low crop prices that you would be able to tell it at the grocery store.
> 
> I can't even really tell it at the feed store.


That's the thing... "commodity" crop prices have virtually NOTHING to do with the prices at the grocery store...

For one thing, virtually all the "yellow dent" #2 corn grown in this country is going straight into ethanol plants or feedlots/livestock feeders (beef, pork, chicken, etc). White corn and some yellow corn goes for corn meal and corn chips and stuff like that, but "food grade" dry corn is a very small part of the market. Same thing with soybeans which are virtually all crushed for oil or processed for animal feed. With ethanol producing wet and dry distiller's grains, there's a lot more of these 'by-products' entering the livestock feed chain as well, which fills part of the demand that in past years would have had to come directly from the grain bins, for the most part (which increases supplies basically and adds to the 'glut', or looking at it the other way, reduces demand by filling part of it). When you look at stuff like wheat, there's basically like a nickel's worth of grain in a box of Wheaties or a loaf of bread, and when you look at the price of those processed foods, there's virtually no "linkage" between the price of the finished product and the grain that's used to produce it. That's basically true 'across the board'.

When you look at stuff like raw meat prices, there SHOULD be more "linkage" in the price, but there's really not... livestock and meat prices have softened, but still remain pretty good, and with grain prices depressed due to a glut in supply, feeders should be doing better than they have in awhile. They certainly shouldn't have as much room to complain, anyway! Not that it'll probably stop them-- Seemed like when I was farming cotton that the "industry buyers" would gripe no matter what-- could be sitting on a huge glut of cotton and prices down to half normal and they'd STILL be finding something to gripe about that they were 'about to go broke'... human nature I guess... The feedlots don't seem much different, in my experience...

Most of the fresh produce and canned goods are produced under contracts signed well before the crop is ever planted. Thus supplies remain relatively steady (unless there's some kind of weather disaster or pestilence, but production of fruits and vegetables under contract is heavily controlled by the contractors (buyers) and usually inputs (irrigation, fertilizer, and pesticides) are applied with a "cost is no object" mindset... so usually MOST problems are manageable-- drought with more irrigation, pestilence with more pesticides... etc.

Anyway, that's why there's virtually no "linkage" between grocery store prices and farmgate prices... Not exactly a new development, either...

Later! OL J R


----------



## stack em up

Not going to get a crop of you dont plant I guess. Market grain to cover inputs, store the rest. Hope for a bountiful harvest. Like every farmer does every year.


----------



## swmnhay

stack em up said:


> Not going to get a crop of you dont plant I guess. Market grain to cover inputs, store the rest. Hope for a bountiful harvest. Like every farmer does every year.


yea no shit if I guy didn't plant it you still have property tax,insurance,equipment payments probably.Have to still pay rent to landlords.Owned land you would loose your potential income for land use.

Let's see to plant or not to plant.I will loose at least $200 an acre if I don't plant it.800 acres x $200 = $160,000 loss.Or plant it and break even and make 0.Even loosing $50 per acre is a lot better then leaving it idle.Well hopefully I make $100 an acre but we will see this fall I guess.


----------



## Vol

swmnhay said:


> yea no shit if I guy didn't plant it you still have property tax,insurance,equipment payments probably.Have to still pay rent to landlords.Owned land you would loose your potential income for land use.
> 
> Let's see to plant or not to plant.I will loose at least $200 an acre if I don't plant it.800 acres x $200 = $160,000 loss.Or plant it and break even and make 0.Even loosing $50 per acre is a lot better then leaving it idle.Well hopefully I make $100 an acre but we will see this fall I guess.


Yep, all the above is what makes it a "Catch 22"....

Regards, Mike


----------



## deadmoose

Food is cheap. As much as people complain about grocery store prices, very few attempt to do it themselves to save money. Those who do gain a new appreciation for how cheap our food supply really is.

If it was all about the money savings, I think I could get another job (starting @ minimum wage) and be money ahead versus producing my own.

If food was actually expensive more people would be competing with the grocery stores to take home all that easy money. Last I checked (here) most anybody who direct markets any food other than quarters or larger of 4 legged critters sells at a premium to the grocery store.

Maybe this varies by locale?


----------



## Swv.farmer

Maby but around my neck of the woods most people grow the majority of what they eat out her than meat,mill,flower,sugar and groceries are still high.gr8 example a package of hamburger meat 12 bucks.that ain't cheap. Steak 13 bucks a pound chicken is the cheapest meat in the store.


----------



## stack em up

Swv.farmer said:


> Maby but around my neck of the woods most people grow the majority of what they eat out her than meat,mill,flower,sugar and groceries are still high.gr8 example a package of hamburger meat 12 bucks.that ain't cheap. Steak 13 bucks a pound chicken is the cheapest meat in the store.


Self sufficiency is king! I'm just trying to figure out where to get Peanut M&M trees....


----------



## somedevildawg

stack em up said:


> Self sufficiency is king! I'm just trying to figure out where to get Peanut M&M trees....


Lol....you can always plant honeysuckle and get honey  just don't plant none of them pussy willow trees, heard them would get you in trouble


----------



## stack em up

Don't worry Todd, we pull the honeysuckle hedges out around here. Dang planter markers have a tendency of trimming them anyways....

I know for a fact I gotta get me some of that Tupelo honey again. That was good!

I'd like to try bee-ing a beekeeper (see what I did there?) Boss's dad is deathly allergic to bees and I'm not sure she isn't. Don't want to take that chance.


----------



## somedevildawg

Ur killin me Paul.....I do like the beekeeping business, I have been stung a many a times by yellow jackets, Hornets, wasps.....had a few reactions to a couple of them, so I too will leave them bees to someone else's beesness....(see what I did there  )


----------



## Swv.farmer

Well you all wait till summer send my your mailing a dress I'll send you some good sour wood honey.
On another note I've always heard that honey is good for alergies.


----------



## somedevildawg

Swv.farmer said:


> Well you all wait till summer send my your mailing a dress I'll send you some good sour wood honey.
> On another note I've always heard that honey is good for alergies.


It is and sourwood will do quite fine thank ya very much......I'll trade ya some Tupelo for some sour wood


----------



## Swv.farmer

Souds like a real deal.


----------



## somedevildawg

Hope mike doesn't see this thread, he's sure to horn in on me......


----------



## stack em up

What's sourwood honey? I live in a bubble pretty much.


----------



## somedevildawg

Sourwood is a delicious honey, made, ironically enuf, from the sourwood tree.....I believe it will be blooming soon. It's a bushy tree unlike Tupelo trees which are true trees. It's a fav amongst the educated.....but even a dumbass like myself is gonna have some soon cause I have a bargaining chip....Tupelo


----------



## Vol

Sourwoods typically bloom in July.....they are medium sized trees that average 25-30 feet in height. They bloom for about 2 weeks. Their flower blossom resembles Lily of the Valley. It is considered a high grade honey.....along with Tupelo.

Be nice dawg.

Regards, Mike

http://www.uky.edu/hort/Sourwood


----------



## stack em up

Yeahh, we get regular old honey. Comes from a jar shaped like a bear. That's the extent I know of it...


----------



## swmnhay

Couple yrs ago a guy loading me at Menards got talking and he got all excited that I had alfalfa ground and he wanted to set his hives by it.i gave him my card but he never did get back to me.

I did mention if I had leaf hopper issues the plane would be spraying.


----------



## Vol

swmnhay said:


> Couple yrs ago a guy loading me at Menards got talking and he got all excited that I had alfalfa ground and he wanted to set his hives by it.i gave him my card but he never did get back to me.
> 
> I did mention if I had leaf hopper issues the plane would be spraying.


He should have said thank you for your forthrightness....I think alfalfa honey crystallizes rather quickly but is very good....but that is just what I have heard as I have no solid first hand knowledge on alfalfa honey. Maybe I will try it out this year on my alfalfa.

Regards, Mike


----------



## IHCman

two different bee keepers keep hives on mine and Dads land. Place their hives near our alfalfa fields and some pastures where the clover comes up wild. They market their honey as alfalfa/clover honey. They give us honey and almonds. More honey than anyone can eat.

I will agree with Vol and say that this alfalfa honey does crystalize fast. Within about 7 to 12 months. The one bee guy told me how to fix it if it crystalizes is to place it in a tub of warm to hot water and leave it there for a couple of hours. Would be good as new. I haven't tried it but will. Mom ususally bakes with any honey that crystalizes.

I always did wonder how much honey really came from alfalfa as once it blooms in the 10 to 20 percent range, we cut it for hay. How much nectar can bees really get in that short amount of time? Bee keeper told me that they do see a reduced yield in honey near fields that are hayed timely. Makes me wonder how much of the honey is from native wildflowers or other plants. Granted the last about 3 out of 4 years the bees should have done well next to our alfalfa becuase with the rainy conditions the 1'st cutting was delayed way longer than normal. The 1'st cutting was in full bloom and quite a rank stemmy mess. Bees should have had plenty of time to harvest nectar then.

Bee Keeper also told me that in the 80s and early 90s they got alot of honey off of sunflower fields around here. Now with the new self pollinating varietys of sunflowers they don't even put hives next to those fields as they dont produce much honey.


----------

