Farm And Ranch Country Posts

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What are the 2 most important numbers to the average government worker. 30 and 55, 30 years of service and 55 years of age. Not all government employees are in government Farm And Ranch Countryfor this reason, but just look at Wisconsin. Many start out for lots of reasons, but soon they get caught in what I call the the “golden handcuffs”.

I discuss benefits and work schedules of government employees. Just how good these jobs really are.

I discuss how farmers view the workers in the “county offices” for USDA and how farmers sometimes trust them too much. I also discuss why the first response to a question is usually no not yes. Why government will never function like a private business. I give my opinion on how to make government more efficient. How to get government “under control”.

Last, I discuss what I think the future holds for government employees.

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Recorded while in our diesel truck, delivering a heifer to a friend. Trial run for recording in tractor this spring. Farm And Ranch Country Thanks for putting up with the noise.

Muslim Unrest
Protests/revolution in Egypt. Now in Libya, Bahrain, Saudia Arbia,etc. Is Obama going to lose the middle east to radicals much as Carter lost Iran? Where does peace with Israel fit into all this?
Loss of faith by pro-western Arab States in the Middle East. Will oil rich nations look for a new ally, such as China?
Will oil rich nations fund the radicals (buy them off) to leave the current rulers in power?
Why did we not support green revolution in Iran more? Is unrest in Egypt over? If Suez Canal closes oil goes through the roof.
The communist takeover in Russia was not the first revolutionary government there. Is the radical Muslim Brotherhood going to be the eventual leadership in a “new” middle east?
The U.S. cannot fight ’em all. Our military is already committed to major conflicts, Iraq, Afganistan, Korea,etc. We no longer have a 600 ship navy that Ronald Reagan left us with. We are down to a little over 200 ships in the Navy.
Remember lots of this fighting is still based on politics between religious sects.
Sunni/Shiite conflict is an inside Muslim religion war. Has gone on for a thousand years. They really hate and despise each other. Saudis are Sunni and Iran is Shiite. Some in Iran want Iran to become the new Persian Empire.
Where will this end? We need to look at history, not politically correct Social Studies.
Are we witnessing the fall of the US empire and the breakup of the current geo-political matrix?
I also discuss how to survive Chaostan in your ag business.

big wageWell it looks like the markets are breaking big time today.  Yes, the grain markets have been down the last several days.  I believe this was people positioning themselves for the March 10th USDA report.  Nothing new, just a small set back in the markets.  But today may be a different story.

The Tsunami/earthquake in Japan may affect markets long term.  I think we all have been looking for the “outside the box” event that would signal a turn in the markets.  Is this it?  Maybe, maybe not, but, it could be.  I still believe we will have a planting rally this spring and will put the top in then.  It is still very cold and wet around the midwest and the forecasts show no relief in sight?

First my/our concerns have to be with the victims.  This looks bad, very bad.  Fifth largest quake since 1900, ships, cars, people swept away.  Major infrastructure damage.  For farmers and exporters this will cut demand.  Yes people still need to eat, but it means less expensive food and survivial mood for lots of people.  Things will come back quicker than all the experts will perdict, but for now with this type of uncertainty the markets will probably back off for awhile.

This continuation of the break will maybe do major chart damage to the grain markets.  It also changes the fundamentals a little bit (less demand).  Is it the deal breaker in the markets?  I do not know if it is, but it could be.  Who ever thought it would be an eartquake/tsunami?

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Farm BoysHow many farmers do we really need?

It is personal to us, at least one of our children wants to farm.

Farm And Ranch Country

“Beginning” and “Young” farmer may not be the same thing, many beginning farmers have already retired from a 30 plus year career in another job.

How does less farmers affect ag-businesses, farm organizations, politicians, bankers, agricultural retailers, manufacturers, etc? How more dependent on your customers does your business become when you used to have lots of small to medium sized customers, compared to the future when you will have very few, but very large customers?

Agriculture continues to do more with less, which translate into increased productivity per person.

Traditional commercial production agriculture does not need a bunch of “new” farmers. 210,000 (less than 10% of the total number of farmers) farmers produce 85% of total farm production in the United States.  The other 90% have room to grow to join the 10%.

Non-traditional, such as organic, grass fed, local sourced, is one growth area for “new” farmers, but it takes a different kind of farmer than what many “new” farmers from traditional backgrounds want to do. This type of agriculture is only about 1% of total production and is generally located near large population centers.  As long as people have excess money to purchase food, this type should grow in numbers.

Every farm group, political entity, agricultural journal, etc. either has a “new” program for “young” farmers or is writing about wanting more farmers.  Is this concern about farmers or about the survival of themselves? Less farmers probably means less of them.

crop insuranceWith March Madness upon us, no not basketball, but getting ready for spring planting, a major decision is what kind and at what level do we purchase crop insurance for the coming year.

The crop insurance industry has consolidated several different products into fewer major policies, but these “simplified” policies still have many decisions and coverage levels to choose from.  There have been lots of meetings to go to and “experts” to listen to, but we still have to decide what to do by March 15th.  Prices of crops have now been set (February daily closing average price) at $6.01 for corn and $13.49 for soybeans.  Wow, those are high, but so is our cost of production, have you bought any diesel fuel lately?

The high prices for crops means higher premiums, but also higher dollar amounts of coverage.  We had 85% level coverage with enterprise units (all units in one county of that crop added up together), crop revenue coverage last year.  Enterprise units helps lower the premiums, but also lowers insurer’s risk.  At our yields and these price levels we are insuring very good dollar amounts of coverage per acre.  But, the cost will be substantially higher than last year.

There are also all kinds of other crop insurance products out there. GRIP,GRIP HRO,  GRP, CAT, are all different kinds of crop insurance policies that are all different, but are used to mitigate risk for farmers.

Are we bored yet?  Have you decided what you are going to do on your farm?  We have.  We will go with RP (revenue protection) at the 85% level and use enterprise units.  I have a few new landlords who do not have yield production history who will stay with GRP (group risk protection) a few more years until they have yield data we can use on an individual policy.  Another landlord will go with the 85% level and two others at around 75% level RP.

Last thing to do is get all the signatures, check that all the social security and EIN numbers are correct, along with correct addresses, and what ever else needs to be done all by March 15th.

If you think this is fun just wait until I describe signing up for the farm program for this year at the county government office (Farm Service Agency/USDA).

My final comments – of all the “farm programs” that the federal government spends money on, this one, crop insurance is the one to keep.  It is run by private companies, sold by private crop insurance agents, and only is the premium subsidized by the government.  This may not be popular to many government employees, but let crop insurance agents do acreage reports like they report crop yields and keep this one program that only pays you if you have an actual loss and the farmer still has to “stand” the first part of any loss and the farmer is paying the bulk of the premium money.  When times are tight you really only need to hold onto the essentials and this risk management tool is very handy to have around.