Divergent Land Values in Midwest, Southeast

Source: USDA NASS

Source: USDA NASS

My little story on land values and land rents in the agricultural economic downturn is up over at Growing Georgia. It's a quick read (hint: Southeast prices are holding on). What's not there, however, are all of the supporting graphs. There are also some highly important maps that show the fundamental ways that Midwest farming and Southeast farming are structured differently. In short, farmers in the Corn Belt rent a lot more land, which — just by sheer numbers — makes them more likely to walk away from land with high cash rents. Farmers in the Southeast, particularly Georgia, have more irrigation and a lot more investment in their fields. That land is a pretty sure bet to produce and too expensive to set aside. 

Maps and data are below:

Source: USDA NASS, 2012 Census of Agriculture

Source: USDA NASS, 2012 Census of Agriculture

Source: Changes in Southern Cotton and Peanut Producing Regions, Shelbi R. Knisley, USDA-ERS

Source: Changes in Southern Cotton and Peanut Producing Regions, Shelbi R. Knisley, USDA-ERS

Source: 2015 Farmland Value Survey, Iowa State University, University Extension

Source: 2015 Farmland Value Survey, Iowa State University, University Extension

The Oggun Tractor

Based on the Allis Chalmers Model G, the Oggun tractor will begin manufacturing and sales in November.

Based on the Allis Chalmers Model G, the Oggun tractor will begin manufacturing and sales in November.

My story on CleBer LLC's new Oggun tractor, an open-sourced model for small farmers, is up over on Growing America. The Oggun represents a radical business concept: The company has created a simple tractor, published the design, and outfitted it with off-the-shelf parts. The idea is to stimulate local manufacturing, free the farmer from a dependency on custom pieces, and drive down the cost of machinery for small producers. CleBer actually welcomes competition. 

““We see that’s the only way that you can get equipment to a price that small farmers around the world can afford. Eighty percent of the world’s small-scale farmers can’t afford a tractor, and 80 percent is really a conservative estimate.”
— Lucky Catron, Partner, CleBer LLC

Although it was inspired by an assessment of the needs of Cuban farmers, the Oggun will begin production in Alabama in November and be ready for shipment to U.S. customers by the end of the month.

 

David Wildy, Southeastern Farmer of the Year

 

David Wildy, a diversified row crop farmer from Manila, Arkansas, is the 2016 Swisher Sweets/Sunbelt Expo Southeastern Farmer of the Year.

Wildy farms more than 12,000 acres in the rich Delta soils of northeast Arkansas. His fifth-generation farm produces cotton, corn, soybeans and wheat. This year marks his second year of growing peanuts and first growing potatoes.

In 2015, Wildly Family Farms averaged 1,180 pounds of lint for cotton, 220 bushels of corn, 65 bushels of soybeans, 6,900 pounds of peanuts, 75 bushels of wheat per acres.

Read more about Wildy's recognition at Growing Georgia and visit the farm website.

 

Enterprise Budget: Sea Island Red Peas

Sea Island Red Peas growing on the Georgia coast, May 2015. These peas are seeded and harvested by hand.

Sea Island Red Peas growing on the Georgia coast, May 2015. These peas are seeded and harvested by hand.

Over the last couple of weeks, I've been working with a farm in the Georgia Lowcountry to create a detailed enterprise budget for Sea Island Red Peas. The farmer has been producing this specialty heirloom crop for several years. Demand, particularly among chefs, is still on the rise. Although sales have been steady, the farmer requested some diagnostic financial tools to assess whether he was pricing his crop accurately and--frankly--whether production, post-harvest processing, and marketing were really worth his time. Outside of some tillage work, most of the operation is performed by hand, which, over the long term, carries an unacceptable level of risk in taking the crop from seed to market. Hopefully, the new enterprise budget will give the farmer a lens to analyze his operation, help him see what constellation of yield volume, cost, price, and labor points would suggest purchasing machinery, and support his case when it's time to go before a lender. 

This particular enterprise budget cannot be published because it is sensitive and proprietary. Keeping it private protects the farmer's opportunity cost to grow a finicky crop in a challenging and often extreme environment. 

However, universities and nonprofits across the country do excellent work publishing an array of enterprise budgets, preparing farmers to make informed decisions before planting and after final sales. Below are several good enterprise budgets for Southern field peas. I will also link back to this page in Resources.