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How ag producers are adapting

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What's the MVP on your farm in 2022 so far?

The current economic environment appears to have more change in two weeks than what historically has occurred in one year! Skyrocketing input costs, price volatility, and increases in interest rates have placed a premium on the ability to adapt and be resilient. Let’s discuss how producers are adapting based on my observations from the road and webcasts.

With higher, more volatile fertilizer costs, producers are seeking both short and long run strategies for substitutes and adjustments. Some producers have indicated that manure is the MVP or the most valuable product. Whether it is poultry or livestock, manure is being utilized with biologicals to better integrate into the long-term soil health plan. Many producers realize that soil health is integral to withstand irregularities in rainfall which range from flash floods to flash droughts.

A special emphasis by some producers has been the growth of niche markets. Organic and natural markets for both crops and livestock are being utilized to serve customers. Many producers have special stories that accompany their products that illustrate how the product is produced and inform consumers about the people behind the business.

Some entrepreneurial producers have not let the crisis go to waste. When grocery store shelves were empty during the pandemic, many producers shifted their production to include grass fed, organic, and conventional methods to sell beef, poultry, eggs, and other products directly to consumers. More new producers in this segment have a nonfarm background and experience working off the farm. This enhances their ability to think outside the box, which can be very useful.

Some producers are using technology, precision agriculture, and basic tools such as soil testing to obtain a bigger bang for their buck of inputs. Some younger producers are collaborating with peers to share equipment, new ideas, and distribution systems to leverage their advantages, spread out fixed costs, and also reduce variable costs.

Another example of producers adapting was observed during my recent presentation to a group on robotics, which included everything from calf feeding to milking cows. Initially, this technology is often purchased to reduce labor costs, but the data output and the information that is harvested allows for more timely and better decision-making. The appeal of technology and an improved work-life balance also attract a higher quality workforce.

Still others have adjusted strategies by scaling down, shifting enterprises, or simplifying their business. Similar to the 1970s and 1980s, this cycle will create opportunities, but will also accelerate change.

Source: David Kohlwhich is solely responsible for the information provided and is wholly owned by the source. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset. 




At your next farm meeting, I challenge you to develop three strategies or three changes that you can implement to make your business five percent better.

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