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your thoughts on gettin through tough times

G

Grunex

Member
Joined
Nov 28, 2009
Messages
11
Location
SE MN
I have been thinking about this for a long time as I am sure many of you have.... What is the best way for farmers to make it through the recession? In my own personal opinion it would seem to me that I've done about the best I can do to cut costs and at the same time maintain my equity as best I can. But being one to never lock myself inside the "box" I am asking other farmers/ranchers for any insight into what I can do differently to improve my operation. I will start with a little bit about my operation and from that if anyone would like more detailed information within reason please PM or email me and I will be glad to talk with anyone who could offer insight. Sometimes one can be too close to the situation and not see the forest for the trees. If ya know what I mean.
The Situation:
IN 2006 my wife and I bought the farm starting with the personal property which has only about one year left on payments and we are done with that portion.
We are a Dairy farm of about 60 cows and have been hit twice in four years with 9 dollar milk like the rest of the dairy community.
my herd average is about 19,000 and I have very few vet problems, my breeding program used to be AI but due to cost cutting measures I have switched to a herd sire which I know will reduce my dollar value of the herd if left for extended periods of time, but the cows are getting bred back and we are still milking with an average days in milk of about 125 to 150 days. In short we are hittin on about all cylinders with the herd right now and from the looks of it will continue to do so well into fall for sure.
Total expenses that we managed to cut out of our operation total about 2,300.00 per month with no impact on production. mostly from gettin tough with the feed and ration. (my ration guy hates me now by the way)
three years ago we began installing energy efficient lightin which cut our light bill by about 175 dollars a month, and I built an outside wood burning stove to heat the house and barn and thus cut out all my home heating (oil) cost and barn heating (propane) and at the same time went with a plate exchanger to heat water in the house and one to heat water in the barn (for non pipeline applications only, we use electric heater for wash cycle) total savings is estimated at about 3500 per year. cost of stove was 3800 to build and install (welded stove and installed myself)
I do all my own mechanic work right on the farm myself and and can handle just about any tear down project without outside help.
my fertilizer costs have been cut to shreds with the help of a neighbor who just happened to need some acres to haul manure on and I run a two year rotation on my fields to maximize N and nutrients more efficiently and control weeds. I am currently using Round up for weed control on corn and having pretty good control with an average Bu. per acre of around 215 bu., hay yields about 5.5 tons per acre dry matter.
Recently in addition to all of this I started a sideline business using my Cat 953 track loader to clean line fences and erosion control and etc. to help out other farmers who I know are struggling with finances to get the things done that they need without breaking the bank.
this and many other things have happened to increase my stability in the operation, and so here I will ask my loaded question, and please forgive me if it sounds stupid. But........ Is there anything else I can do to put more stability under my feet to ensure a roof over my family's head ???
I will welcome any an all replies if serieous and will do my best to talk with each and every one who posts or emails me personally.
many thanks in advance for your thoughts and ideas on this matter.
 
It looks like you have covered most of the bases. I would think that you will have to watch your rations/herd health close since that determines your income and no cut backs could probably cover much of a loss in production.
Keep up the good work. If you were closer I could use you and that payloader. :D
 
Like David Ramsey says, 'sometimes you can't cut back any more, you
just need more coming in.' Then he says you can make $1000/month
delivering pizza at night. Might be good in the city, but doubt it would
work in the country. :wink:

I know milking cows is a tough deal. We have friends in Missouri who
milk and they finally got to take a vacation after 30 years. And they
have come close to losing everything more than once. It isn't easy.
It's too bad. You should get paid better for what you do.

Sounds to me like you're a survivor, tho. Hang in there.
Does your wife work away from home?
 
I've come to the conclusion that a wife making $80 grand a year really helps my bottom line. Were on a 10 year plan have ALL of our debt paid off in 10 years. I'll be 52 then and would like to relax a little before they kick dirt in on me.I've also come to the conclusion that I don't need one of everything.
 
Faster horses:
to answer your question, yes my wife does work off the farm, she works in a hospital food service, which helps a lot!
I'm proud of her for her ambition, and determination. She used to be an agriculture instructor in the Philippines, but that is hard row to hoe over here because of the origin of her training. (credentials do not transfer across borders I guess)
However we do look at this farming lifestyle as one worthy of pursueing and we hope to keep the farm in the family. We both feel very strongly that without agriculture in this country, our country would be very much depleated of a big part of our heritage and economy.
 
The two options that sping to mind are; look into diversifying is there a maket for direct selling sheep for example, or growing alfalfa for local horse owners?
Is there any opportunity to change your market to sell your milk at a better price? or even start a small scale processing (cheese/) operation and grow into it as you gain experience and increase your market, the mozerella here on the estate has grown from a niche product sold through the farm shop, to a major line available in the top end supermarkets and restraunts.
Can you add value to your calf sales? breed your best cows pure for replacements, and put a good beef bull over the others, is there a niche for veal production? a Continental bull would give the required quality of suckler calf required by restraunts in the city. Direct marketing some of the beef is another option, if there is a private abattoir available, and better still, a butcher who can cut and pack for you at a sensible price. (I did my own cutting and packing for several years, it helped in building up my business, but kiled off all social life for that time).
Hope these suggestions stimulate some new ideas.
 
yes indeed value added is one thing we have discussed and currently we do sell fat steers on the hoof for those that wish to purchase that way. I do sell crops such as Alfalfa and high moisture corn at least as much as what I do not need. I have a set minimum and like to leave about 15 to 20% more in reserve in case we have a dry year or something like that.
I have limited buildings for livestock and so things like diversification into something other than steers and Dairy is an expensive option to which I cannot venture into until times improve. That is one of the reasons why I started the land clearing and reclamation, It was somethig I could do with the equipment that I had and sort of kill two birds with one stone.
One thing that very much intrigues me is the one farm processing of dairy products, I've been trying to look into it, and will continue to do so. looks to me like high inputs again to get started but can develope into a rather profitable venture.
ONe other thing that I thought may be a good way to go would be to look into bio mass pellets for pellet stoves or even to take our manure and start composting.......????

Side Note:
There is a place near Altura MN called Pork and Plants which also branched out into alternative energy and they make pellets for customers and they use them to heat their green houses. I'd be happy to provide anyone with their info if it helps.
 
First off I will say, I am no place to go for advise, but do see what you are saying. I am with Denny, don't buy anything you don't need, in time it will get better.

Trends have changed, we no longer look at farms and ranches as just a place to make a sustainable living, to compete you must look at them as a business.

I believe the place to start is to look at all your resources. Is it labor and expertise, is it land, grass, wildlife, etc. Then decide how best to use them.

The agriculture economy is upside down today, imputs costs have risen much more then returns. Land costs have rose because land is no longer thought of as place to earn a livelyhood but as a long range investment.
 

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