Wallaces Farmer

How 7 small steps can help you survive tight margins

Surviving economic downturn requires small steps that cumulatively add up to a large impact.

Gil Gullickson, editor of Wallaces Farmer

September 20, 2024

6 Slides
Soybean field with sunset
CORN OR SOYBEANS: That’s a rotational choice farmers will need to make for 2025. Plunging summer soybean prices are causing Tim Bardole, a Rippey, Iowa, farmer, to tilt more toward corn than normal in 2025. He normally plants a 50-50 corn-soybean rotation but may adjust to planting upward of 70% corn due to slumping soybean economics.Gil Gullickson

Farming under tight margins would be easier if a single solution existed, akin to a thunderous grand slam by New York Yankees slugger Aaron Judge. 

Unfortunately, that’s not the case. Surviving downturns in farming requires more of a small-ball approach, such as a single, a stolen base or a bunt.

“When we address cost structure, historically what we’ve seen is it’s not one or two big things that make a difference,” says Jim Knuth, senior vice president for Farm Credit Services of America. “Instead, it’s a number of smaller things farmers do that add up and make a difference.”

It’s not all cutting costs, either. Oftentimes, budgeting dollars to maximize return on investment also is part of the equation.

Here are seven factors that cumulatively can greatly impact cost structure, return on investment and other factors on your farm. 

1. Review your rotation. “Corn looks to be a little sunnier than the soybean market,” says Eric Weuve, Iowa State University Extension farm management specialist. “All summer long, corn has been more of a slow bleed on the way down. Soybeans have been in a triage since the end of June.”

Soybean’s dismal outlook is prompting Tim Bardole to assess his corn-soybean rotation for 2025. “Instead of going with our normal 50-50 rotation, we may increase corn acres up to 70%,” says the Rippey, Iowa, farmer.

The strip-till system he adopted in 1997 fits corn well. “On corn on corn, we haven’t had yield drag with strip till because we plant right on top of the nutrients we put in the ground,” he says. “Corn takes more fertilizer, which raises expenses, and it is better for the soil to rotate between crops. But the soybean prices have been so low we may have to go with more corn.”

2. Optimize soil pH. Having the correct soil pH ensures that whatever fertilizer you apply to a field is available to the plant.

“We like to see soil pHs in the mid-6s to high 6s,” says Chris Doud, a Pioneer field agronomist based in south-central Iowa. “If soil pH is below 6, investing in lime will give you the best return on investment.”

3. Budget for supplemental N. Rampant rainfall brought myriad nitrogen (N) losses during the 2024 growing season, says Eric Wilson, agronomy manager for Wyffels Hybrids. It’s a reminder to retain some money in 2025 if needed for supplemental N.

“With all the rainfall we had last spring, many farmers had above-normal nitrogen losses,” he says. “We highly recommended a supplemental N application during the growing season, around 40 to 50 units [per acre]. Those 40 to 50 units went a long way. You could see the fields that got a little extra love and care versus the ones that didn't in terms of nitrogen deficiency and stalk quality.”

4. Carefully assess P and K. Since they are immobile nutrients, unused phosphorus (P) and potassium (K) remain in the soil for use the next year. In tight-margin years, this makes cutting P and K a tempting option.

Be careful. “Considering some of the yields we’re pulling off with corn and soybeans, we’re withdrawing a lot from the fertility bank account,” Doud says.

5. Do repairs yourself. Dave Walton of Wilton, Iowa, plans to spend more time in his shop over the winter. “We’re going to do more repairs ourselves instead of sending machinery to a [commercial] shop,” says the Wilton, Iowa, farmer. “Me with a wrench in my hand versus paying a technician $150 an hour is a big savings.”

Part of this plan is to rebuild an existing planter rather than trading for a new one. He also plans to use after-market parts rather than dealer ones whenever possible. 

“This will help keep working capital in my pocket,” he says.

6. Reevaluate weed control. Ever do the State Fair Flush? No, that’s not a new dance or a new poker hand. Rather, it’s the flush of weeds that pokes through the canopy of many soybean fields in mid-August during the Iowa State Fair.

“Every year, you can have bean fields that look great until about State Fair time, and then the waterhemp and giant ragweed and volunteer corn start poking above the canopy,” Walton says.

Herbicides cost money, but weeds also shave dollars by nipping yield potential. That’s what is prompting Walton to review his 2025 weed-control program. 

“Hopefully, we will go with a program that will not be as expensive as the one we are spending money on now,” he says.

Long term, Walton is searching for weed-management techniques that complement broadcast herbicides.

“We used to run a weed wiper that we got rid of in the ’90s, but now they are making ones that you can put on sprayer booms,” he says. Weed wipers physically wipe appropriate amounts of herbicide directly onto the weed.

“If we can’t control weeds with layers of residual herbicides, we need another option,” he says. “It may be something like a weed wiper.”

7. Match hybrids with field. “Price is always the pinnacle point of any seed discussion before moving into yield potential,” Wilson says. “Everyone wants both.”

This year, however, price is more of a concern due to slumping corn and soybean markets. Still, there are ways to save money on seed purchases, Wilson says.

“There are hybrids that yield well but still are not prime, top-of-the-line products,” Wilson says. However, these less expensive hybrids may yield as well as top hybrids on fields with lower yield potential.

“There’s room for those products that could be moved into a seed lineup,” Wilson says. “That will help growers save money.”

About the Author

Gil Gullickson

editor of Wallaces Farmer, Farm Progress

Gil Gullickson grew up on a farm that he now owns near Langford, S.D., and graduated with an agronomy degree from South Dakota State University. Earlier in his career, he spent 13 years as a Farm Progress editor, covering Minnesota and the Dakotas.

Gullickson is a widely respected and decorated ag journalist, earning the Agricultural Communicators Network writing award for Writer of the Year three times, and winning Story of the Year four times. He is a past winner of the International Federation of Agricultural Journalists’ Food and Agriculture Organization Award for Food Security. He has served as president of both ACN and the North American Agricultural Journalists.

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