Amherst WI | tkoppel - 8/30/2014 20:01
Well, here's the deal. No, I never borrowed operating money, but I have had a small off farm income stream, and my wife had a job that provided health insurance. I started pretty small and worked my way up. Rented ground nobody else wanted (either blow sand or soggy ground where I had to run the muskrats off first) and bought 80 acres with the savings I'd accumulated over the previous ten years. I've never been a corn grower so I suppose I never had the same kind of operating expense guys in a corn/soybean rotation have. Pretty much soybean/dry bean/small grains/hay in some sort of rotation. And, I suppose I'm pretty small compared to most on here at @ 300 acres.
For equipment I started out pretty simple. Rented a no-till drill until I could afford to buy one. Had Helena or CPS or some other farm service do my spraying until I could afford a used sprayer of my own. I had a old 3020 gasser to pull the 10' drill and used my old half ton pick up to haul my assortment of old small rickety gravity boxes to the elevator. Almost forgot my CII Gleaner with 12' head to do my threshing. Believe me, nobody ever drove by the place and became envious of my equipment! All in all my capital expenses were and have been pretty insignificant and frankly still are.
My goals were pretty small I suppose. Accumulate some more land and improve/tile it and pay it off as fast as I could. Grow crops that ought to turn a profit. That meant producing crops suited to the land I had to work with, contract a profit on the bushels I forward contracted, and insure the crop sufficiently in order to recoup my input costs should the unforeseen take place. Over the years I've sold a lot more soy's for less than $6.00 than for over $12.00, and there have ben years where I was just happy to wash out even with my costs.
So, like I said it's been a series of base hits with the occasional home run or strike out and a lot of plain old luck. The last six years or so have been very good to most all of us. The question is did you use the profits to reduce debt exposure or did you use it to buy more "stuff"?
Both really, but for the most part the "stuff" were things that I felt I was better off owning instead of paying to have it done. Looking back I wonder if I would have been better off to hire everything done and put the money into land, but hindsight is always 20-20 but even in that case it seems like that is more of a six of one and half dozen the other.
I also look at all the crops we grow, and the irrigation equipment we have and it adds up to a lot more expense than a no-till corn-bean guy. When you add up the livestock equipment, hay machinery, pivots, pumps, trucks it becomes quite a list.
But when you can't find a reliable trucker what do you do? When you can save 20% buying chems and spraying yourself again what do you do? The list goes on and on. About all I hire done is the big square baling.
We are in good enough shape if we wanted to go buy some land we could but I'm sick of my steers being in a swamp after it rains and it is time to build them a shed to be in or get out. With a $3 (or less) wet corn crop coming getting out of them doesn't look like that would work out well either.
We do have our home farm paid off and it is free and clear but it is only about 10 acres so its not the feat you've accomplished.
You can email me if you want to talk more if you would like, it would be easier than searching for this thread. |
which would the banker rather hear?
