The beginning of this week saw both grain and cattle markets take a significant dip. Some important things to remember while we are going through lean times.
The first two days of this week have been tough for the ag industry. Monday, we saw the cattle futures tumble as a result of the fire at a Tyson processing plant in Kansas over the weekend. Prices continued their downward trend on Tuesday. Not to be out done, the grain futures took a nosedive after the USDA released the August Crop Production report Tuesday, August 12.
Events such as these are a stark reminder of how volatile the ag business can be. We realize that often the fate of our businesses are totally out of control. These are most definitely stressful times for those of us in the industry. I am not a ag economics expert by any means. However, I believe in times like these, we can examine our businesses and work on their efficiency. We can also reflect on our blessings and remember how fortunate we are.
Rethink Marketing
Just because the markets have taken a dive does not mean we cannot hedge ourselves with some alternative marketing. On our place, we use this as a time to direct market our beef to consumers. We can avoid a loss at the sale barn by keeping some of our calves back and letting them grow on grass then finish them for local folks who crave home raised beef. Its a great opportunity for a win-win for both consumer and producer. Also, we choose these times to put more effort into heifer development. Since these heifers are not worth as much at market, we often keep extras as replacements.
Cut The Fat
In lean times, we can learn a lot about what makes our business tick. We can also learn what things we can do without. We can make repairs to existing equipment instead of trading it in. We can get creative with our fencing repairs instead of tearing out and putting in new. Its a good time to pick up some new skills through self education. The wonderful thing about the internet is you can pretty much learn some basic skills for free just through a quick google search. Levi and I have put this to use when installing some new electric fence this summer.
Appreciation and Perspective
In tough economic times, it can be hard to see past how tough things are in the present. However, if we are to move forward, we must realize that these lean times will not last forever. Times were good before and they will be good again. The beauty of markets is that they will come back around eventually. We must hunker down and weather the hard times. We must cling to the ones we love when times are tough. We must seek out those around us who are enduring similar battles. We are not alone in these tough times. We must talk about our issues and also be a resource for others.
My friend Val Farmer has some very valuable resources when it comes to dealing with financial stress in farm families. I recently read his article on off-farm work and the additonal stress it can bring to farm families. This is something I can surely relate to. It is nice to have that steady source of income, but it can sure be a hindrance to what we have to do on the farm. I mention this because I think its easy for folks to say that to get through tough ag markets, farmers should just get jobs in town to make ends meet. But markets being tough doesn’t mean that work at the farm comes to a halt. Fences still need fixed, cows still have calves, crops still need planted. I’m fortunate enough to have a job where ranching is not my primary source of income. But to think of taking on a second job just because times are tough is hard to imagine. That would take time away from my family and other things that bring me joy. Being happy is a key part of getting through the tough economic times. Sure, we could use the extra income. However, we need the time with our families more.
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Jason