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Avoid these grazing management pitfalls

It has been said and I agree that partial rest of pastures and rangeland has been the most destructive management tool man has ever implemented.

The most nutritious and economically best plants are basically removed from the sward after a few years and replaced with lower-seral (lower-successional) plants that produce less biomass, less energy and have shallower root systems.

Most of North American land management is now based on the growth and management of the lesser productive plants. The result has been increased sensitivity to drought and lower production along with high input cost. Lack of quality biomass and soil quality loss has sent lots of ranchers to town looking for new work.

To read the entire article, click here.

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3 tips for managing farm family living expenses

A few weeks ago, I attended my hometown’s agricultural event, DakotaFest. The annual event features a trade show, educational forums and networking opportunities. One of the speakers at the event was a seed salesman who told the grain farmers in attendance, “One-fourth of you sitting in the audience right now will not be in business this year.”

That’s a pretty gloomy outlook but perhaps it’s not so far fetched given the state of commodity markets right now. While cheap grain offers opportunities for beef producers, the corn super cycle is long gone, and now folks are scrambling to adjust and survive the lows.

In addition to low prices, another reason the speaker cited that so many would be out of business by 2017 was out-of-control family living expenses. Driving around the countryside, it’s hard not to notice the expansive new houses that have been built in recent years as well as the fancy cars and top-notch equipment that sit in many farm yard.

Heck, even without these luxuries, which were surely investments made when prices were stronger, raising a family in today’s economy is tough. In addition to operating expenses of the farm or ranch, expenditures such as daycare, kids’ school activities, groceries, insurance, the mortgage, cell phones, electric, water, internet and retirement savings really add up.

According to a study conducted by the University of Illinois Department of Agricultural and Consumer Economics, the total living expenses of 1,350 farm families averaged a whopping $88,936, or $6,809 per month, in 2014. The speaker at DakotaFest guesstimated that for some farm families, this number has crept up closer to the six-figure mark in recent years.

READ: Farm and family living income and expenditures 

Knowing how easy it is for expenses to creep up, my husband and I try to be diligent about saving and trimming the budget any way we can. Of course, this is often easier said than done, particularly with two babies on board, but we realize our future in production agriculture rests with our ability to be smart with our earnings and investments. Granted, time is a great teacher, and if I can rewind the clock to six years ago when we first got married and bought our ranch, I would be a little more money wise right out of the gate.

This weekend, I’ll be offering some advice to young producers on this topic as a panelist speaker at the U.S. Cattlemen’s Association’s 2016 Cattle Producer’s Forum in Billings, Mont. In researching the topic, I found a great article titled, “Farm & family connections: Taking control of farm-family living expenses.” Written by Janet C. Bechman, a professor at Purdue University’s Department of Consumer Sciences & Retailing, she outlines some ways to regain control of the farm family finances.

Here are three tips to get a handle on living expenses while protecting the family business:

1. Set goals

Bechman writes, “Goal-directed management is important in achieving personal, family, and farm-business goals. Taking time to set and prioritize goals can help you and your family make decisions about how money is spent and determine how each family member can help ensure success.

“This requires a frank discussion involving all family members. Writing down the goals and priorities also increases commitment. Be as specific and realistic as possible. Think about what you want, when you want to accomplish it, the amount of money you need to do it, and how much you will need to save weekly or monthly. Next, prioritize the goals within each category. Personal, family, and farm goals will inevitably compete for resources. The entire family will need to make adjustments and compromises.”

2. Determine income

Farm income can be irregular and uncertain,” she says. “Income often varies considerably from year to year. Income and expenses usually follow a seasonal pattern, but even that pattern varies from year to year.”


She suggests listing your sources of income, make your best estimates of possible selling prices and production, and subtract your best estimates for costs of feed, seed, fuel, chemicals, hired labor, livestock, repairs, taxes and other expenses.

“This will give you an estimate of the amount available for paying debts, family living expenses, and other capital purchases,” she adds. “This will also help you estimate how much short-term borrowing you will need during periods of little or no income.”

READ: USDA’s Farm family income report

3. Estimate expenses

“Next, you need a careful estimate of the amount required each month for family necessities,” advises Bechman. “Look at your own past records to make estimates for food, clothing, personal items, health, education, home maintenance and utilities, education, transportation, and giving. This type of record keeping is invaluable in predicting future spending.

“If your family living expenses are greater than your income, you can either reduce expenses or increase income. Reducing expenses will require your family to decide which expenses are essential for their physical and mental health and safety, and which expenses are nice but not essential. In some cases, your family may even have to place priorities on necessities, rating the most important necessity as number one, the second as number two, and so forth.

“Even when your income is sufficient to cover your immediate living expenses, you may find that you will need to decrease your expenses or increase your income to reach your goals, increase your non-farm investments, or make additional farm investments.”

This is basic advice that won’t save every farm family or guarantee success; however, I find the more I read up on financial planning and management, the smarter choices I make on a daily basis when it comes to our money. 


What other tips would you offer young producers at the upcoming event? I would love to pass on some words of wisdom from seasoned ranchers. Share your best advice in the comments section below.

The opinions of Amanda Radke are not necessarily those of beefmagazine.com or Penton Agriculture.

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How to mess up a business without breaking a sweat

No matter their strengths, businesses, like people, are always at risk. Some dangers are so blatant they dare being ignored. But others, far less obvious, cause untold—and even fatal—damage, eating away and undermining a company’s best efforts. Their work is insidious and relentless, going unnoticed until it’s too late. And it all happens without anyone breaking a sweat.

Even so, there are clear, but unseen, indicators that a business is in trouble. Here are nine to consider:

1. Wanting to believe everything is going great. Business people don’t like bad news. They reject it as they would an unwanted solicitor. And then they quickly add, “I want to be around positive people.”

Jim Holt comes close to the truth in his review of Chuck Kloserman’s book, But What If We’re Wrong. Holt states, “Most of what we believe is likely to be wrong.” If that’s true, then doubt, not certainty, is the only positive action.

2. Ignoring details. A lack of productivity imperils businesses, caused by the extraordinary amount of time that’s lost by following up on what’s being ignored. We assume that someone will come along and clean up our mess.

But that’s not the Apple way, as Michael Gartenberg discovered on his first day there. He sent someone an email. “I got it back, and at the end of it, It said, ‘P.S. spelling counts here.” Gartenberg had typed “the” as “hte.’”

The way we view details reveals how we regard others and what we view as important.

3. Decisions based on the leader’s opinions. Many business owners and managers believe it’s their role to be Decider-in-Chief. They have firm—cast in concrete—opinions on everything. Research, surveys, studies, facts, knowledge, and the experience of others don’t count. They proudly trust their gut.

Employees learn quickly that discussion is useless, and new ideas are on an “Unwanted List.” It’s a perfect way to strangle a business.

4. Poor planning. Sure, it’s fun to talk about wow ideas. They create excitement and lots of energy, but little or no action, even though that’s what makes a difference. Everyone goes away and nothing happens. It’s the same the next time.

To keep a business on track and growing, there’s only one question that gets the wheels moving, that generates fire, not smoke. There’s only one question that gets results: “Who’s going to do what, why, and when?” Nothing else matters. It’s nailed down. No loose ends. Some call it taking responsibility, while for others it’s accountability. It’s all the same; it’s what it’s all about.

5. Data blindness. When asked why his insurance agency couldn’t launch an eNewsletter for its clients and prospects, the principal, a smart client-oriented and capable underwriter, said, “We can’t do it until we get our database straightened out.” He’s not alone. Good businesses fall behind and others die or merge because they’re gridlocked, unable to develop and implement an effective plan to gather the information they need.

Too many suffer from the debilitating case of data blindness, the inability to recognize that their survival depends on the accuracy and completeness of updated, relevant, reliable, and accessible information.

6. Failure to adapt to customer behavior. After launching its Nest Cam, the company found that many customers were pointing them out the window to keep track of what was going on, according to IoT Daily’s Chuck Martin. Rather than letting a competitor run with the idea, they launched a weatherproof outdoor version to solve the problem.

Unfortunately, “Maybe we should wait and see what happens” is the common reaction, which is followed by “Why didn’t we do that?” after it’s too late.

7. A confusing culture. It seems to happen at entrepreneurial-type companies where management is highly motivated and hard driving. Along with it is a lassiez faire attitude that everyone can be left alone and they will automatically do their job. When that doesn’t happen, there’s disappointment that people didn’t live up to the challenge.

Instead of setting people in a direction with agreed upon expectations, they are set adrift. And all the while, they think they're doing what’s required. A confusing culture causes havoc.

8. Failure to educate customers. A recent American Consumer Satisfaction Index indicates that consumers view Facebook, Twitter, and LinkedIn “more negatively” than in past years. It set off alarms at Twitter. The company found 90% of people worldwide know the Twitter name, but only those who use it get what it’s all about, a 40 point gap. Twitter now has a campaign to educate people on how the platform works and the benefits of using it.

Every company faces the same problem. Satisfied to drink their own Kool-Aid, they fail, often miserably, at telling their story consistently. And it always catches up with them.

9. Misunderstanding branding. The usual focus of branding is a logo and a tagline. Yet, as one mother reminded her son, “Clothes don’t make the man.” And a new logo and a tagline don’t make a brand. That’s just putting on a new suit.

Branding is about questions: Why are we doing this? What do we value, and how do we show it? Who are our customers? What do we offer them that makes a difference? What sets us apart from our competitors? The answers to these questions are the brand.

Messing up a business is easy. It doesn’t take effort. There’s no need to break into a sweat. It occurs without taking notice, even though the signs are all along the road.

 We should never drink our own Kool-Aid. It puts us to sleep. But the anecdote is simple: Always worry. Look over your shoulder. Never get comfortable.

John Graham of GrahamComm is a marketing and sales strategy consultant and business writer. He is the creator of “Magnet Marketing,” and publishes a free monthly eBulletin, “No Nonsense Marketing & Sales Ideas.” Contact him at [email protected], 617-774-9759 or johnrgraham.com.

Farmland value likely to pull down pasture value

A new report from Rabobank says farmland rent values must drop to meet lower commodity prices and it's highly probably all land values will fall, too.

"If rental costs remain sticky at unsustainable levels through the 2017-18 growing period, individual land assets face the threat of much deeper devaluation, as nutrient and crop protection programs are cut and abandonment (usage changes) increases," says Sterling Liddell, Rabobank Food & Agribusiness Research and Advisory service analyst.

The research arm of the international bank says using its baseline price projections of corn below $4 per bushel, soybeans below $10.20 per bushel, and wheat prices falling in the $4-5 per-bushel range, rental rates need to decline from an expected $1.60 per expected bushel of corn produced to around $1.30/bushel. This is if the costs of seed, crop protection and fertilizer remain relatively flat.

Generally this means a $30 per acre to $50 per acre decrease. Such a move would push returns from farming back to near breakeven, if expected production equals trend-line yields.

Even with a decline in rental values, farmland acreage contraction will still likely be needed before commodity prices reach a sustainable level in the long term, Rabobank analysts say. This should mean a return to grass and forage crops.

To balance supply and demand at a sustainable breakeven price, Rabobank analysts estimate that 3-5 million acres will be forced out of corn, soybean and wheat production over the next three years. This is about a 2% decline from the five-year average of total farmland.

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Vegan criticism is fuel for my fire

My family and I just got home from five days at the South Dakota State Fair. We love going to the event each year, where we have a chance to showcase our seedstock, network with industry friends and peers, and camp with four generations of our growing extended family.

Upon arriving home, I posted a few photos on Facebook of myself and my kids at the fair. I heard a “ding” on my computer and assumed it was a comment from a friend on my photos; instead, it was a private message, which read:

“Just read your article at BEEF Magazine. It's disturbing that you consider yourself logical. And it's even more disturbing that you are raising children and contributing to our gene pool. Animals are not meant to be massed produced and farmed for mass consumption. Please educate yourself for the sake of your family and their future. Just because you were raised that way and how you identify your heritage and livelihoods does not mean it is justified or ethical. Go work at a slaughter house. I did. And I saw the steers shipped to market, every year, covered in their own feces, thirsty and terrified. I was a 10 year-old little girl, and I knew at my core it was evil. Justify this treatment and industry and you could justify Nazi holocaust trains. God will judge this. I hope your children see what you choose to ignore. Your line of thinking is what is wrong with the world.”

I mean, wow. How do you respond to that? Comments like these are pretty typical in my line of work, and I hardly ever bother to respond. Just like the political election has been extremely polarizing on social and economic issues this cycle, I don’t expect to change the minds of the vegan crowd, nor should they expect to change mine, in conversations about animal agriculture.

Sure, I don’t like being criticized for procreating, but what bothers me the most is that activists continue to compare meat production to Nazi Germany. At the core, I do not believe an animal’s life is equal to a human’s, and I find it disturbing that the vegan crowd can’t differentiate between the soul of a person who during the Holocaust was tortured and murdered for their religious beliefs to an animal that is fed, watered, nurtured and cared for until they can be respectfully harvested to feed and nourish people with beneficial protein and by-products, including life-saving medicines.

Activists want to vilify all ranchers and push livestock to become extinct. Their idea of “compassion” is self-serving and hardly has anything to do with the animals or people themselves. Just read their comments on my blogs that address meat consumption, vegetarians or animal welfare and see for yourself how out of touch with reality they really are.

However, I always tell myself that if an activist needs to take the time to criticize, berate and insult me, then I must be doing something right. Someone asked me once if I felt my blog is just speaking to the choir since the majority of my readership is geared toward active ranchers and industry professionals. To that, I say I hope this blog serves as a catalyst for change and action. By sharing consumer trends, activist shenanigans, regulatory threats, and other outside challenges that could impact our livelihoods, I hope to inspire folks to join me in advocacy efforts to protect the industry, our land and cattle, our right to consume meat and our ability to be profitable in the beef business.

The opinions of Amanda Radke are not necessarily those of beefmagazine.com or Penton Agriculture.

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USDA offers new heat stress smartphone app

USDA’s Agricultural Research Service (ARS) has launched a new smartphone application that forecasts conditions triggering heat stress in cattle.

The app is compatible with Android and Apple mobile phones, and issues forecasts one to seven days in advance of extreme heat conditions, along with recommended actions that can protect animals before and during a heat-stress event.

It is available at both Google Play and the Apple App Store.

In some cattle, distress and discomfort from prolonged exposure to extreme heat cause diminished appetite, reduced growth or weight gain, greater susceptibility to disease and, in some cases, even death. Cattle housed in confined feedlot pens are especially vulnerable to heat-stress events.

In addition to high temperatures, weather-related factors like humidity, wind speed, and solar radiation can contribute to heat stress.

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How the beef industry can capitalize on millennial meat buying habits

It’s Labor Day, and I hope everyone is finding a way to relax a little bit over the long weekend. September brings more than cutting silage and doing fall calf work; it’s also a time for tailgating, ball games, back-to-school activities and fall bonfires.

Food is typically a big part of any gathering, and meat is the center of it. New research conducted by Midan Marketing is helping the beef industry identify the needs of consumers — from baby boomers to millennials.

READ: 3 ways to think like a millennial shopper & sell more beef

According to the study, which was featured on The Shelby Report, millennials represent a $75.4 million market, overtaking boomers as the largest generation. With this spending power, it’s important to pay close attention to how this generation spends their dollars in order for beef producers to capitalize on their purchasing habits.

The study looked at 425 millennials and 400 boomers in May 2016 to determine their attitudes and perceptions about meat. The research identified 12 differences between the two groups; here are a few that the beef industry should think about:

First, millennials spend significantly more on meat than boomers. The study revealed that, “In an average month, Millennials spend significantly more on meat than Boomers ($162 vs. $93). This can be explained by two important differences between these groups: one, Millennials have larger households (and growing families), and two, they purchase proportionally more prepared meats than Boomers.”

READ: 3 things millennials want to know about beef

In fact, of the meat millennials purchase, 44% of it is prepared meats compared to only 22% for boomers.


The study revealed that both groups have positive attitudes toward meat, but health concerns are a top concern for decreasing consumption. However, boomers said the cost of meat was the second reason for cutting back on meat while millennials listed animal welfare, environmental concerns and social influences as reasons to decrease their meat intake.

As a millennial myself, I can understand some of the thoughts this group is going through when they go to the grocery store. Whether they are fresh out of college, getting married and having kids, this is the time in their lives when they are developing their lifelong spending habits, personal beliefs, food habits, and determining how they will feed their families in a way that also aligns with their values and busy schedules.

It won’t be an easy task to meet the increasing societal demands of this generation, especially when they are being blasted on social media with so much negative, misguided information about food. Everywhere you look, there’s another negative report slamming meat production and consumption for a myriad of reasons, and it could be tough to change perceptions.

I think the millennial consumer would benefit greatly from having the opportunity to meet and visit with real meat producers who can explain how we, too, share the same values in caring for the environment and the livestock, and that we also want to eat food that is healthful, nourishing and safe.

We can no longer afford to sit idly by and hope someone else does the advocacy for us. We need to be proactive in engaging with consumers — online and in person. We need to engage and inspire folks to feel confident in their meat purchases without the guilt.

The opinions of Amanda Radke are not necessarily those of beefmagazine.com or Penton Agriculture.

 

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This Week in Agribusiness - September 3, 2016


Over a Cup - September 3, 2016 : Past Presidential Nominations and agriculture, trade, and GMOs

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