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Ways to ‘future-proof' the farm

Curt Arens Haley Miles, her husband, Mark, and their young son, Bogue
BRIGHT FUTURE: Haley Miles, her husband, Mark, and their young son, Bogue, are excited about their future and the future of their ag operation near Ainsworth, Neb. But Haley Miles noted during the recent Nebraska Young, Beginning and Small Farmer Symposium in Lincoln that it takes deliberate steps to “future-proof” your operation to handle any challenges and opportunities that may be on the horizon.
A panel of young producers looked at ways to prepare their operations for the future.

It has been said many times that farmers and ranchers are the greatest gamblers. No one knows what the future holds, but several young producers are employing deliberate strategies to take the gamble out of farming and navigate an uncertain future.

Haley Miles works as a farmer-feeder with her husband, Mark, and their young son, Bogue, near Ainsworth, Neb. As a founding member of the University of Nebraska Engler Entrepreneurship program when she was in college, Miles recently shared her story about the farm she and her husband operate during a panel discussion at the Nebraska Young, Beginning and Small Farmer Symposium in Lincoln.

She talked about Sandhills Blue Photography, a wedding and “small-town” rural photography business she has started that keeps her very busy, along with her farming and ranching duties and the responsibilities of being a young mother.

One of the important points Miles made was describing her family’s mission to “future-proof” their operation, allowing them to take advantage of new opportunities that may come along, but also in preparing themselves for challenges that arise.

In light of the challenges of moving finished cattle to a processor during the height of the COVID-19 pandemic, Miles and her husband took strategic steps to diversify their business and add multiple income streams, including the photography business, into the mix.

“As true farmer-feeders, we are kind of a dying breed, and there are more challenges that we are facing,” Miles told the audience. “That is why we are growing our cow herd.”

She noted that living at least three hours away from a town of 5,000 population has its own challenges. “There are trade-offs for living here,” she said. The Miles family loves their hometown, but they are far from many amenities. Some young producers would find that difficult, but for Miles, it is a small price to pay for new opportunities.

“There are so many opportunities because of less people and more land mass,” she said. “There is no way we could have scaled up our cow herd and future-proofed our operation without living where we live.”

Ainsworth, as Miles noted, is like a crossroads, because there are ample high-quality cattle available in the region because of the Sandhills, but they are also close enough to irrigated corn country to take advantage of locally available feedstuffs.

Working together

Joe Knobbe, West Point, is also a farmer-feeder. He came home from the University of Nebraska-Lincoln with a bachelor’s degree in ag economics, but adding him to the family feeding operation was complex.

“My dad was having health troubles, and that is when I decided to come back home,” Knobbe explained. But coming back home into an operation that involved his father and two uncles, Knobbe also had another cousin who wanted to return at the same time. His father and uncles, who were all a part of the family operation, had to split up their operation to make it work.

“We had six years of transition,” Knobbe said. “There was a period where we still did business together, and through the years, we’ve eventually split up. It was a good, clean split, because we all still work together, and there is a synergy of keeping close ties with each other, sharing labor and equipment.”

Having their own operations, but still working together, has established a resiliency to all the operations in a way that Knobbe couldn’t have accomplished if he had to do it all on his own, he added.

“It’s tough to borrow money as a beginning farmer,” he explained. “It is tough to grow, and you can’t grow without that kind of backbone. A lot of youth want to go back to the farm, but they need someone to give them that chance and to get their foot in the door.”

Lance Atwater of Ayr is a little unique in the family-farming world. His father is a first-generation farmer who was born and raised in California. Atwater returned home to his family’s Nebraska farm after college at UNL.

 “I’m following in my dad’s footsteps,” he said. “But you don’t hear many stories about first- or second-generation farmers. I have friends who are sixth- and seventh-generation Nebraska farmers.”

On the Atwater farm, they raise corn, soybeans, popcorn and non-GMO white corn. While many young producers continue to think about transitions from the generation of their parents to their own generation, Atwater, who like Miles is a parent of a young child, observed that the future of agriculture is greater than these young farmers.

 “The future of ag is not just me and those younger than myself,” he said. “It is also our children, so we need to make sure there are opportunities for them down the road, too.”

Extra income

Glen Smith, Iowa native and CEO of Farm Credit Administration, was one of the moderators of the panel discussion, along with UNL vice chancellor Mike Boehm. Smith, who farmed for much of his life, knows a thing or two about farm transitions and financial success in agriculture.

He noted how Atwater and Miles both added diversity and niche income streams to their operations, with Miles and her photography business and adding a cow herd to their operation — and Atwater raising non-GMO white corn as a niche crop.

“It’s very important to step out of our comfort zone and to diversify these early operations,” he said. “Whatever source of cash flow you bring in removes additional risk to the lender, so you are on the right track.”

Miles noted that because her husband had worked in ag finance for several years before returning to the family operation, when they approach their lender, the couple knew what the lender needed and how to keep their operation financially sound.

Atwater echoed those sentiments, saying, “We need strong relationships with our lending institutions, whether that is the local bank, Farm Credit Administration, or whatever that might be. Have scenario conversations with your banker, covering different scenarios.”

There is no normal year in agriculture, and there is a new issue every year, whether that is weather, policy-related or trade, he added. “We have to be able to adapt as farmers,” Atwater noted. “There will be challenges this year for inputs, so we might need to take some of our chemicals on hand because there is talk that we won’t get it otherwise,” so that is one way to adapt to a challenge, he said.

Conservation practices

“We’ve invested in more conservation-type practices since I’ve been back home” as a way of future-proofing the operation, Knobbe said. “That has really opened the door for us to bridge the gap between farming and feeding cattle.”

With support through numerous USDA conservation programs, they’ve been able to upgrade technology to keep track of irrigation water, and have added cover crops and limited tillage on their cropland.

“I do some custom seeding on the side to provide supplemental income when we aren’t so busy,” Knobbe said. “It’s good to have those [USDA] programs to get started on something different.”

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