Tough ag economy weighs on minds at Farm Science Review

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LONDON, Ohio — One good thing about this year’s low commodity prices — perhaps — is that they’re not new. Prices were low this time last year, as well, and they’ve been even lower in recent years.

The low prices weighed heavily on the minds of farmers and equipment manufacturers at this year’s Farm Science Review, and some are calling it the “new normal” in agriculture.

The annual event was held Sept. 20-22 and drew a crowd of 125,790.

“The ag economy, as we’ve seen over a lot of years, has had its cycles and we’re in one of those cycles,” said Doug Jennings, eastern sales manager for Great Plains.

But Jennings said seasoned farmers saw this coming.

“The attitude of the farmer is good,” he said. “We’re going to continue to produce food to feed the world — we just have to be a lot more conscientious of how we manage that.”

Thinking critically

The low returns have farmers thinking more critically about their input costs, and whether each cost is worth the investment.

“It’s definitely cut down on spending on equipment. You’re watching all of your inputs,” said J.P. Wheeler, whose family farms in Adams County. “You can’t really afford to go out and spend money on things that you don’t need.”

His friend, Steven Shiveley, said farmers are keeping their used equipment a little longer, and holding off on new purchases.

“Wear what you got out” is the mentality, Shiveley said. “And you fix it when it’s broke.”

Kent Hardin, a salesman for Evolution Ag in Circleville, said farmers today are less likely to spend big money on new equipment.

But at the same time, farmers need to be careful of what they cut — because sometimes the new equipment is the path toward more efficiency and profit.

Hardin said the new technology offered on today’s equipment will save farmers money — if it is used correctly.

“Most (farmers) have the technology but they don’t know how to use it,” he said. He added that doing research and trying out the equipment before the first day of harvest or planting is key, and so is asking questions early on.

Getting answers

Asking questions is a big part of the review — and there are always qualified people to provide answers.

At the John Deere booth, Steve Detrick, manager of national promotions, explained the lineup of tractors, balers, planters and harvest equipment that made up this year’s display.

Detrick said farm equipment improves daily, and the goal at John Deere is to provide producers “better opportunities to evaluate what their inputs are, so they can do a better job of making on-the-spot decisions, allowing better profitability in the end.”

On-the-spot decisions have become the norm in recent years — with shorter planting and harvest windows.

In the fields

Victor Constable, territory manager for MacDon, demonstrated his company’s draper head technology in the fields. He said the markets could be better, but farmers seem to be adjusting.

“It’s more optimistic than it has been in the past,” he said. “The prices aren’t great, but the guys seem to maybe be looking forward to a good end of year. … Overall, I think we’ve just adjusted to the fact that we’re back to being normal, instead of aggressively good like it had been.”

The seed companies at this year’s review were also well aware of farmers’ concerns — and the consideration of some farmers to cut back on traits and technology.

But cutting back on seeds can end up costing more than it saves, depending on the kind of growing season, and yield goals.

David Benning, a sales manager with LG Seeds, said the traits often provide “a nice insurance policy.”

Each operation

He said it’s important for farmers to work closely with their seed dealers, to make sure they’re selecting the right traits for their farm — but also each field of their farm.

“What we want to do is help producers protect every bushel we can, because every bushel is going to be very valuable in this kind of market,” Benning said.

Tony Meyer, regional sales manager with Great Lakes Hybrids, said there’s definitely some cash-flow concerns among today’s farmers.

He said the seed business is a “relationship business,” and he wants to see farmers get lined up with the best traits for their own operation.

Over at the DuPont Pioneer booth, Clay Lust and Joe Ungers were promoting Encirca services — which includes a variety of precision ag services, including Pioneer’s flagship nitrogen management program.

Nutrient management

Pioneer provided visitors an interactive display that showed how the company maps field terrain and soil information, to provide the grower with “management zones, or decision zones.”

It’s all about precision, and allowing the grower to put together his or her nitrogen plan, based off their yield target and the soil’s needs.

But Pioneer is also tracking phosphorus (P) and potassium (K) — two nutrients that can be depleted by today’s high-yielding, nutrient-demanding varieties.

In late August, Pioneer announced the findings of its own fertility study, which found that Corn Belt farmers may be leaving profit potential in the field each season, if they don’t carefully manage all of their nutrients, including phosphorus and potassium.

Comprised of more than 22,000 soil samples, the study demonstrated that P and K were deficient in a significant number of tested fields. In Ohio, about 35 percent of tested soils were low in phosphorus, and 19 percent were low in potassium, according to Pioneer.

Optimum levels

The goal — as with all of precision farming — is to increase those nutrients to optimum levels — without over-applying.

Lust said farmers still have an appetite for precision technology and prescription seeds — because of the difference it makes.

“Obviously they (farmers) want to see a return on their investment, like anything else,” Lust said. “So it’s been good showing them how we can define their farms or maybe change up some things they’ve been doing.”

Niche markets

While farmers don’t have a lot of options, one may be to seek out a niche market. Pioneer continues to expand its contracted acres for farmers who want to grow high oleic soybeans, used to produce a healthier cooking oil known as Plenish.

Brian Buckallew, senior production systems manager with Pioneer, said the company contracted about 450,000 acres of Plenish in 2016, and predictions for 2017 are close to a million acres.

Pioneer once again held an on-site cooking demonstration using Plenish, and allowed visitors to taste food cooked with the oil.

“It’s a good time to be talking about (Plenish) because it is a value-added opportunity,” Buckallew said. “It’s an opportunity to add about $20-30 an acre to your operation.”

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3 COMMENTS

  1. The 2015 FSR was just like this with sun all 3 days.But this 2016 was incredibly warmer.Maybe towards the upper 80s Chris.Heard temperatures before reported on 610 WTVN as high as 91.Cannot recall a time at FSR where I was spending time in tents & drinking soda,water,lemonade & apple cider just to stay hydrated

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