Tips for Overcoming Declining Farm Income

Farmer, agronomist and farm management perspectives in facing tough times were featured at the recent Illinois Soybean Association-hosted Resilient Farmer Roadshow.

Eric Ifft, agronomist and Bayer CropScience customer business advisor; Dan Farney, farmer and United Soybean Board director; and Brandon Tate, Illinois Farm Business Farm Management Association regional operation manager, addressed these trying times as panelists.

Ifft said Fred Below’s “Six Secrets of Soybean Success” is among his guides when looking at improved soybean production. The University of Illinois crop physiology professor lists weather, fertility, foliar protection, genetics, row spacing and seed treatment as his “six secrets.”

“We grew soybeans for years without seed treatments, what’s changed? The answer is everything has changed. We have higher yielding varieties, we’re planting earlier and we’re planting less population,” Ifft said.

“In terms of return per bushels, seed treatments to me are a necessity. I don’t consider them a luxury anymore.

“ILeVO was the seed treatment product that we tested in the ISA Yield Challenge. In my mind it’s come back to where it’s not an agronomic decision anymore, it’s a risk management decision.”

Ifft also focuses on foliar fungicides for soybeans and continues to do field trials in that realm.

“I was all in on foliar fungicides in corn because I could see gray left spot, I could see rust and I could see northern corn leaf blight. I know when the crop is suffering from those. I’m a scout and spray guy,” Ifft said.

Georgia farmer Randy Dowdy shattered that notion with his record-setting 171.8 bushels per acre record in 2016. Prior to that, Kip Cullers of Missouri hit 161 bushels an acre in 2010.

“Maybe 100 bushels was right for the day, but it’s not right today, and one of the things we should be looking at is what are the things we can do to chase that,” Ifft said.

More Soybeans

After many years of growing two-thirds corn and one-third soybeans in his strip-till/no-till operation, Farney shifted to more soybean acres.

“I could not make my corn-on-corn work comparable with corn after soybeans, so I have gone essentially to a 50-50 rotation. Growing more soybeans is one way I’m managing risk,” he said.

“Prior to 2006, I was not really buying very much crop insurance. I was farming with my dad; I didn’t think we needed it. But when prices took off, I said I can’t afford not to buy it just from the risk management value of what the corn was,” Farney said.

“In 2012, that was one of the best decisions I made. I could quit worrying about what the crops were doing and what the yields were going to be because we had reached the floor.”

Marketing Plan

Tate noted several consistencies with the more resilient farmers in FBFM.

“They tend to have a clear cut marketing plan, and they stick to it. They know roughly the number of bushels they’re going to sell and when they’re going to sell and they do that to kind of take some of that emotion out of selling it so they’re not always trying to hit that high,” Tate said.

Another characteristic of those resilient farms is they have land leases that are more favorable to the ups and downs of the farming industry.

“You have 50-50 leases or when things started making an upturn they didn’t jump up the cash rent, they went to a cash rent with bonus to allow the landlords to get in on some of that income during those higher years, but also let it kind of drop back down when we come into these years where we don’t have as high of returns,” Tate said.

In addition, those farmers with up-to-date accurate records typically know where they are and are making decisions based on their true financials.

Tate was asked if FBFM clients know where the profit margin starts per bushel for corn and soybeans in their operations.

“I would say they used to be better at knowing that. When we really started to see the big spike in prices back in 2012, 2013 and 2014, a lot of them got away from that because they could sell, and they were going to be profitable,” Tate said.

“We’ve gotten into more lean times and more of those are starting to run the cash flow projections and really starting to look at what is this costing me and where do I need to be at for those breakevens. I think we’re seeing a comeback of them being more aware of where that price is.”

Source: Tom Doran, AgriNews

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