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Our year in review: Managing thin margins

Photo courtesy Maria Cox Cox cover crops
We’re making changes to improve our business, and that includes cover crops.

The leaves have fallen, and Thanksgiving has passed. I’ve taken time to look at the big picture and reflect on how our farm has changed in the past year.

The first thing on my mind is the farm economy. I moved back and started farming in the drought of 2012. That drought led to record prices in subsequent crop years. Input costs were high, but we had no problem getting the chance to sell $12 soybeans and $4 corn.

The landscape is much different today. Large crops, large stocks, and other reasons have led to low, stagnant prices. I've done a decent job of selling rallies and marketing ahead, and I plan to have that attitude for 2018.

Hay prices were also high after the drought, and they have remained lower but steady regionally in recent years. I could write an essay on how the live cattle market has given me gray hairs, but I'll keep it simple: it has been volatile. I'm also planning to lock in small profits and hedge downside risk for our feedlot business.

Simply put, narrow margins are the reality and it's up to us to manage those margins as well as we can. 

Cover crops benefits

The second thing on my mind is cover crops. We jumped head first into cover crops this year. My dad says he is more excited about cover crops than anything else in his almost 50 years of farming.

We have seen immediate benefits, such as erosion and weed control. This fall, we dug into the soil to see the cover crops at work. It is exciting to see earthworm activity and roots growing through layers of soil to break up compaction.

Long-term, we think a cover crop and no-till practice will improve soil structure, increase water infiltration, and lower equipment usage, among other benefits. In my mind, continually working the ground is a short-term fix to prepare the seed bed for planting. But, cover crops can be a long-term solution for bettering the soil. 

Since we have started using cover crops, we've also encountered an influx of naysayers casting gloom on our practices. If I had $1 for every time someone told me our cover crop no-till strategy won't work, I'd be able to retire! If our new system ends up not working to our liking, it won't be hard to drive to town and buy a plow. The farm manufacturing world doesn't appear to be short on tillage equipment. Nevertheless, there is no one right way to farm, and maybe tillage is the right practice for many farms. The neat thing about farming is that there are hundreds of ways to produce a crop.

I often think as farmers we feel the need to have every problem solved before it occurs. But, sometimes things beyond our control can force us to make changes. On our farm, it’s important that we manage our daily business well, but also have the capacity to know when it’s time to make changes to improve our business.

The opinions of the author are not necessarily those of Farm Futures or Farm Progress.

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