Love this list. Gives a little more insight into the business side of ag, and also corrects some pervasive ideas (all farmers wake before dawn!).
10. The price of corn isn’t the price of corn
The same goes for any other commodity. With grains, every load you deliver is tested for a variety of factors and all of them can affect the price. When you take a load in you are either getting that day’s market price or a contract price that was determined previously. That’s the starting point. If your product is too wet or too dry you can get docked for that because moisture will have to be added or removed. We have drying facilities on our farm, but it can be expensive and time consuming so you have to weigh the benefits of storing or delivering at harvest as the crop comes in. Non-crop material, bugs, damage and more are all things than can be cut off the original price per bushel.
11. Farmers don’t necessarily own all the land they farm
My wife gave me this idea. Before she met me, she thought farmers farmed whatever they own. In fact recent data shows farmers only own 60% of what they farm. Lots of farmland is rented or leased from landowners.
Why don’t farmers own all the land? Many times the current landlord is either a retired farmer or a relative who was given or bought the land. For some farmland is purely and investment. There is some concern now about too much non-ag investment in farmland. When you own the land you are in control of it, but for most it just isn’t economically feasible to own everything you farm. Farmland that is for sale or being offered to new renters goes fast and the competition can be intense. You’ve got to know what you can and can’t afford so you can make a move when the time comes.
12. Farmers don’t go to Florida in the off-season
That’s not entirely true. We do go on vacation just like anyone else, but we do work when we aren’t in the field planting and harvesting. I think some people actually do spend a few weeks in Florida. If you’ve got livestock vacation time can be a little tricky.
“What do you do when you aren’t in the field?” is probably the question I get asked the most by other people. There’s plenty to be done. We fix things that were put off during the busy times. We also make improvements to our equipment and facilities. There’s a good chance of buying, selling, or trading equipment too. In between planting and harvest you need to scout your crops for pests, weeds, and disease and then decide if any management solutions should be implemented. If you have grain storage facilities on site this is the time you market and deliver the crop. Farm auctions abound in the summer and winter. Farmers retire, go bankrupt, and yes they die too. When that happens there will undoubtedly be an auction or sale. Anything and everything can be for sale from wrenches to tractors, and even buildings and land. Next month I’ve got to study and go take a test to qualify for my pesticide applicator license. There are meetings, shows, and field days put on by various organizations and agribusinesses where farmers can learn about new products and techniques. Keeping up on the latest information is important to any business including farming. Oh, and don’t forget taxes! Ugh. Got to do taxes and prepare income statements for the bank.
Read the rest here.