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Time to tune up your farm financials

Keep your family farm running smoothly with a midyear management checkup.

Mindy Ward, Editor, Missouri Ruralist

July 31, 2023

2 Min Read
 2023 Budget planning and management concept
LEAN IN: It is time to take a long, hard look at how your farm is performing based on budgets. This midseason look may allow you to adjust and remain in the black this year. Parradee Kietsirikul/Getty Images

It’s a little slower this time of year as crops grow and cattle graze. Put it to good use by taking a closer look at your farm management practices.

Just past the midway point of the year, now is the time to examine and adjust your farm plan. The University of Missouri Extension in a recent news release noted five areas to assess:

1. Agricultural budgets. Check enterprise budgets to evaluate projected costs and returns. Adjust as needed. Use budget calculators. Each state Extension or university typically offers one. If yours does not, Mizzou has the Missouri crop and livestock enterprise budgets as a reference. It also offers customized budgets for agricultural enterprises — including cotton, peanuts and rice.

2. On-farm labor. MU Extension agricultural economist Ryan Milhollin suggests evaluating current labor needs and assessing employee relations. “Hiring and keeping good farm labor can be a challenge for operators of all sizes,” he says. “Having a solid management plan to find and reward productive agricultural workers can position farms for success.”

MU Extension team members recently developed a suite of how-to videos, checklists and resources for farm labor management that can help operators attract, hire, retain and, if needed, fire farmworkers. These are applicable no matter the state or operation type. Find them at the farm labor website.

3. Custom service rates. Whether seeking or offering custom services, keeping track of current rates is important. Find median rates of farm services by checking your state Extension guides. They help determine costs of items such as fieldwork, planting, fertilizer and chemical applications, harvesting and hauling, heavy equipment jobs and more.

4. Succession planning. Transition and succession planning is critical for farm operations. Now is a good time of year to have those conversations. Take steps to allow for ease of transitions in the farming business.

5. Farm lease agreements. Take quick inventory of current farm leasing arrangements. Communicate with your landowner or tenant about changes to current agreements. Look at multiple leasing options beyond traditional fixed cash or crop-share leases.

MU Extension specialist Juo-Han Tsay says operators may consider flexible cash leases to allow landowners and tenants to split risks and return more equitably given uncertainty and fluctuation in input costs and prices. He, along with other colleagues, developed a primer for flexible cash leasing arrangements that is available to download for free at extension.missouri.edu/g422.

Don’t wait until the end of the year to realize you’ve missed the farm management mark. Start now. Then don’t be afraid to change your plan to hit the target.

About the Author(s)

Mindy Ward

Editor, Missouri Ruralist

Mindy resides on a small farm just outside of Holstein, Mo, about 80 miles southwest of St. Louis.

After graduating from the University of Missouri-Columbia with a bachelor’s degree in agricultural journalism, she worked briefly at a public relations firm in Kansas City. Her husband’s career led the couple north to Minnesota.

There, she reported on large-scale production of corn, soybeans, sugar beets, and dairy, as well as, biofuels for The Land. After 10 years, the couple returned to Missouri and she began covering agriculture in the Show-Me State.

“In all my 15 years of writing about agriculture, I have found some of the most progressive thinkers are farmers,” she says. “They are constantly searching for ways to do more with less, improve their land and leave their legacy to the next generation.”

Mindy and her husband, Stacy, together with their daughters, Elisa and Cassidy, operate Showtime Farms in southern Warren County. The family spends a great deal of time caring for and showing Dorset, Oxford and crossbred sheep.

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