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Building on success

Farming into the Future: The Murphy family expands and diversifies to welcome the next generation.

Editor’s note: This is a first of an ongoing series in Ohio Farmer focusing on the next generation of farmers.

By Gail C. Keck

As brothers Steve and Milton Murphy approach retirement, Steve’s sons, Nick and Willie, are gradually expanding and adapting the family’s farming enterprises to take advantage of market opportunities. They all work together sharing facilities and equipment, but they each have their own land bases, and they divide input costs accordingly.

The arrangement does require considerable record-keeping, but it fits their needs as they shift from one generation to the next, Willie explains. “We’ve thought about going to a bigger corporation arrangement, but we think it will be easier down the road for transition to my brother and I if we all have our individual operations.”

Murphy Farms, based near Wilmington in Clinton County, Ohio, has plenty to keep everyone in the family busy. All together, they farm about 3,500 acres, raising corn, soybeans, wheat, hay, barley and spelt. Each of the four farming partners has about the same acreage, with a combination of owned, rented and crop-shared land.

In addition, Steve has a 1,200-head hog finishing barn he built in 1996. Willie and Nick own another 1,200-head hog barn they built in 2011. The Murphys manage daily operation of both barns to feed out hogs owned by another nearby farm family. Nick and Willie have also expanded the farm’s beef enterprise to include about 60 brood cows plus another 300 to 400 cattle on feed.

Volume discount

Acting as one entity to purchase inputs lets the family members take advantage of volume discounts, Willie says. They also recently installed fertilizer storage tanks so they can plan ahead and buy 28% UAN when the price is right. “I already have prices for our 28 for 2021,” he adds.

Another benefit the Murphys gain by working together is  sharing their expertise in different areas. For instance, Nick manages the farm shop and equipment, while Willie focuses on record-keeping and coordinating day-to-day schedules.

Even though they each have their own land, the Murphys all work together to coordinate fieldwork. For instance, Steve and Milton generally manage field prep. Milton also handles corn sidedressing. Willie is in charge of all the corn planting and Nick handles soybean planting with the help of an employee running a second planter. Full-time employee Davey Allen is the head herdsman for the cattle operation. The division of work continues to shift, Willie adds. “As Dad approaches retirement, we’re hiring high school students to fill in.”

At harvest, each load of grain is weighed before it goes into storage, so they can keep track of the bushels from each field. Willie markets grain for everyone under the Murphy Farms umbrella and tells buyers where to send payment for each truckload. That way, each family member and crop-share landowner is paid for the number of bushels produced on his own land.

Equipment upgrades

As Nick and Willie have worked into the business, they’ve invested in machinery upgrades. Generally, when they upgrade, Steve and Milton contribute the value of the old equipment, which is used for a trade-in, and then Nick and Willie pay the difference for the new machinery.

To track income and expenses for the different enterprises and allocate them to each of the partners, Willie has set up a computerized record-keeping system. “Microsoft Excel is the best friend I ever had,” he jokes. His wife, Brooke, also helps keep track of expenses by reviewing invoices and dividing up personal and business expenses. For instance, they get a monthly bill from a parts store that might include some parts bought for personal vehicles, as well as parts for farm equipment. Brooke divides the farm expenses evenly among the four farming partners, and then she adds in any personal expenses to figure out each person’s share. Each person is then responsible for sending in payment for his own share.

Niche advantages

To capture market premiums, the Murphys have raised a variety of identity-preserved crops including food-grade soybeans, soybeans for seed and non-GMO corn. Those crops require extra effort to clean equipment and bins, coordinate quality testing and manage delivery, Willie says. For instance, they once organized a fleet of 12 semis to haul out 60,000 bushels of non-GMO corn within a nine-hour delivery window to fill a barge on the Ohio River. “If you make a quarter here and a dollar there, it adds up. It takes a little more management, but it’s worth it,” Willie says.

The premium opportunities for non-GMO corn have dwindled in recent years, but the Murphys still prefer non-GMO hybrids, Willie adds. The hybrids they’re using give them yields that rival GMO hybrids, and seed costs are much lower, he explains. They also want to avoid using the same herbicides they are using for soybeans to prevent development of problem weed populations.

On the other hand, the Murphys have been choosing soybean varieties that have GMO traits for herbicide resistance. Those varieties offer the best genetics for top yields as well as the resistance traits, says Willie. “That’s where the companies have been putting their money.”

Besides corn and soybeans, the Murphys raise wheat for grain and straw. They also grow some spelt for cattle feed and six-row barley, which is sold through as nearby elevator for feed grain. Additional land not suitable for row crops is used for pasture and hay production. In addition to using the hay for their own cattle, they sell 6,000 to 7,000 square bales each year to local horse and livestock farmers.

The livestock enterprises are also important to the farming operation as a whole. The two hog barns provide manure, which is valuable source of fertilizer for surrounding fields. Although it might be easier to handle daily chores if the barns were side by side, the Murphys built them on separate farms, Willie explains. One is surrounded by about 600 acres of crop ground and the other has about 400 acres of land nearby, so manure goes where it is needed and hauling distances are short, he explains. “The barns were put there for that reason.”

Viral beef marketing

The Murphys feed out beef calves from their herd of about 60 brood cows and buy additional calves to feed out as well. They have been marketing 300 to 400 finished cattle per year, with some sold as freezer beef and the rest marketed through a nearby stockyard. They are currently in the process of putting up a small building so they can sell retail cuts of beef by appointment.

In previous years, the Murphys had been selling about 50 animals each year as freezer beef, but this year, demand has soared. Consumers are more interested in filling their freezers because of the market uncertainty caused by COVID-19, Willie explains. The Murphys have been working with a local packer to market the freezer beef, and by mid July they had already sold 93 head in 2020. Appointments are set for at least another 55 this year, and 20 are scheduled for processing in 2021.

The Murphys have also sold some live cattle to individuals who took them elsewhere for processing. Some of the business has come from repeat customers, but other people found the Murphys through their Facebook page or word of mouth. Selling cattle for freezer beef takes additional work, but they earn more per animal than they would get on the open market, Willie says. “We’re answering the demand as we’ve got it.”

Keck writes from Raymond, Ohio.

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