When it comes to managing production farmland in diverse cropping regions of the country and where new alternative cropping is being established, professional farm managers and accredited agricultural consultants have the task of educating themselves to any and all new realities of production agriculture.
An example of diversified cropping and options of crops for farmers to grow has been occurring in the Red River Valley region of North Dakota and Minnesota. "I grew up in southeast Minnesota; therefore, moving here 10 years ago was a great learning experience because of the vast variety of crops that are raised. It is a challenge to learn the ins and outs of each particular crop. They are all different from agronomics to marketing. Each has their own markets," said James Ivers, accredited farm manager with Alerus Financial, N.A., at Grand Forks, N.D.
Although diversified farming operations and farmers having more options for crops to grow are discussion points in agriculture, diversifying entails long-term planning and investment, according to Ivers, and also according to an agricultural business consultant in the Pacific Northwest, Randy Wheatley, and an accredited agricultural consultant in New York, James Peck.
Crop Rotation Common
Crop rotation is quite common in diversified cropping operations; therefore, in general, a minimum of three different crops are planted on a farm each year, noted Ivers, and it is hard to bring a new crop into the rotation. If there were such a thing as a guaranteed high-return crop to be produced from year to year, it would be incorporated into a rotation one way or the other. Ivers, on behalf of the landowner, would encourage it because cash rents are based on the appraised land value plus the potential income that a tenant can be expected to generate. But sure bets of new crops being guaranteed cash cows haven't shown up.
Because of the typical three-year rotation of crops in the Red River Valley, land leases are usually written for three years with cash rents based on the average potential income and the land value. Because wheat is a low-value crop common in most rotations, land leases are affected accordingly.
"The risks on the high-value or high-dollar crops are much greater. Sugar beets have been consistent over the years, but potatoes, for example, can be a feast or famine. With the high input costs, it can be a great year if everything goes right or a disastrous year from bad weather, disease or poor markets. The same is true with dried beans. There have been years when you couldn’t get rid of pinto beans and then two years later there are not enough pinto beans to go round. There are a lot of unknowns at planting time each year," Ivers said.
Many Sources of Education
Peck operates ConsulAgr Inc. at Newark, N.Y., and as an AAC, he works with the owner of farming enterprises rather than absentee landowners. He said diversification in both crop and livestock operations are extensive in his up-state region. He explained that diversification spans from fruit trees to row crops and from poultry to dairy operations. He has to stay diversified in his crop production knowledge plus have knowledge about government programs and environmental issues related to soil and water.
" I work with a significant number of dairy and animal feed lot operations doing their CAFO permits for the state. They are very extensive permit reports and require the skills of an agronomist and manager with understanding of environmental issues," noted Peck.
Learning on the job and in structured programs are both important to Peck, especially because of the diversification involved in what he is asked to do. "One reason that I belong to ASFMRA is for the continuing education opportunities," he said. "I find common ground for interaction with farm managers, and we talk a lot about similar issues. But I keep reminding my Midwest contemporaries that what we do here is no way like what they do. In my 40 years of business, I have only once done something similar to a Midwest farm manager in managing a piece of property and not working directly with the farmer landowner."
Planning for Longevity
Wheatley said the Pacific Northwest, specifically Idaho and Washington, has been diversified, but, "I definitely think we are seeing more crop diversification than in the recent past." This diversification isn't making the consulting job easier.
Wheatley, who works out of the American Falls, Idaho, office of Lookout Ridge Consulting, said the company's consultants deal directly with producers, landowner and agri-businesses. Wheatley said he works with ag lenders, agronomists, other consultants and Department of Agriculture personnel. "We have to keep up on all the programs available, the latest production methods, the market potential, grant money and other long-term opportunities for our clients."
Wheatley said, "We have a two-fold focus when working with our clients. Whether looking at long-term sustainability or a more immediate need, we strive to provide the clients with consulting that will lead to both happy families (people) and financially healthy businesses. We provide planning services such as succession planning, dairy and crop profit modeling, financial management, financial ratio analysis, human resource development and grant writing."
Diversification definitely requires consultants and farm managers who keep their boots on the ground and computers fired up.