Planning for Contingencies

By Tim Alexander

planning for contingenciesPlanting and harvest in 2019 were bookended by an extended winter, an early frost and a fall snowstorm, leading many Illinois soybean producers to experience yield and profit losses due to the short window for plant development. Throw in a market-reducing trade war with China and delay in congressional approval for the United States-Mexico-Canada (USMCA) trade pact and, at the very least, maybe producers can look back for lessons that can be learned from 2019.

Upgrade Farm Technology Assets

It’s easy to see why farmers may be reluctant – or financially unable – to invest in emerging ag technologies and equipment advances. However, farm management technologies can provide a more precise view of an operation, helping to identify potential inefficiencies. The right tech tools can also give farm managers an opportunity to more proactively micro-manage expenses and finances and limit risks to their operations during challenging times.

“Sustainability is about doing more with less. Once you have economic sustainability, then all of the other aspects of sustainability can become possible, especially in production agriculture,” says Patrick Christie, founder and EVP of Conservis, a farm management software company serving midwestern producers and farm managers. “You can’t improve what you can’t measure.”

Investing in agtech can help farmers sustain field performance and agronomic opportunities, according to Christie. He recommends two core areas for farmers to focus upon: data collection, and an investment in a pro data system that can optimize the information programmed into it.

“Getting data that are high quality from your field, or your geodata, organized is a top priority. We’re finding that farmers who are able to leverage data successfully are connecting all of their field data into a business system. A lot of money can be made or lost, for example, through how you manage your inventories. If they haven’t already done so, farmers need to organize their farm-centric business information,” Christie says.

University of Illinois farm economist Gary Schnitkey says 2019 income for some Illinois grain farms was negative. And with farm income steadily declining, Christie understands producers are reluctant to spend money on technology this winter. But, he encourages them to do so anyway.

“When there is revenue pressure, success comes down to efficiency and costs. Farms have a lot of moving parts. An opportunity to save money may come after a decision window closes, but you must maximize revenue opportunities. Having a better view on when to market or having a data set that can move alongside your crops as they go to market can be very beneficial,” he says.

Christie offers an additional economic benefit to investing in a good data collection system for the farm. “Because we are in a depressed farm economy, bankers are looking for more information to confirm their credit is properly risked. Farmers that can present a complete, core management view of their farms to bankers or lenders have an advantage in that relationship. Farmers that can deliver a complete business system can transform their opportunities,” he says.

Consider New Weather Tools

Staying current with weather and climate technologies can help farmers stay ahead of the curve when planning for contingencies as well, says Bryce Anderson, DTN senior meteorologist.

“There is a continued trend towards more site-specific information,” he says. “We offer an on-farm weather sensor and weather monitoring station that allows producers to take in real, specific information on temperature, rainfall, humidity levels, evapo-transporation and more, including a node that can be added that provides soil moisture information. Producers are able to save costs because they have more information available not based on a reading at a weather measuring site 15 or more miles away. There can be a marked difference in rainfall amounts at that distance.”

As the average size of U.S. farms increases, so does necessity to employ a site-specific weather system, says Anderson. “We have growers that own more than one weather station, one at home site and one in a field miles away. Others have as many as four or five. This type of investment can actually help mitigate the impact of the current commodity price scenario,” he says.

Such weather systems provide the ability to monitor real-time wind speed and direction, which can save farmers money when applying herbicides, pesticides or fertilizers. High-end farm weather systems also track field-level data and store it, allowing farmers to base decisions on historical information exclusive to their operation.

planning for contingencies

Manage Nutrients and Soils

“The number one thing growers can do as far as a soil fertility program is make sure their soil Ph levels are correct,” recommends Pete Fandel, soil expert and agriculture professor at Illinois Central College. “Any time you can get your Ph level into that 6.3-to-7 zone, that’s going to make most of the nutrients already available in your soil more available for a plant to use.”

For farmers looking to mitigate weather-related contingencies, Fandel advises upgrading tiling systems for a relatively quick return on investment and to improve plant quality under stress.

“We’ve moved into pattern tiling and can control the amount of water level on a field more quickly over a wider geography because of the narrower spacings,” says Fandel. “And with tile now being a little more shallow than it used to be, we are not taking all of that excess water out of a field that a plant might like to have back in July or August if it doesn’t rain.

“When you want a field to dry down, say in the spring, you can let the excess water go. Later, you can store more water,” he explains. “This also might be a good year to try a little more minimum-till or less tillage. This can help save money by keeping crop nutrients in the field.”

Invest in Comprehensive Crop Insurance

Investing in a comprehensive crop insurance plan can help farmers plan for contingencies related to the weather, says Bradley Clow, Country Financial crop operations manager in Bloomington.

“Farmers can help protect their livelihoods by making sure they visit a crop-certified insurance representative in Illinois. Take the time to identify your specific farm operation, the crops you are growing, the land, the soil type – all of this is imperative in making the coverage selection to protect your livelihood,” he says. “We had more than 2,600 prevented planting claims in 2019 in Illinois, a new record for Country Financial, so we have adopted some new ideas from what we learned from that.  Everybody learns lessons from past years.”