February Class: Intro to Ag Finances

Intro to Ag Financial Management

Dates: Feb. 4, 11 & 18, 2015 (Snow date, Feb. 25)
Locations: Berlin or Rutland, VT
Times: 1-4 pm.

Make this the year you bravely step into the world of farm finances!  With two top-notch ag financial management specialist to lead the way, Intro to Ag Financial Management  will help you approach farm finances with confidence. This course provides farmers with the knowledge they need to understand and complete a balance sheet, income statement and cash flow statement. Participants will learn the basics of budgeting and skills to anticipate the financial needs of their farm operations. Participants can choose to participate in a clinic with one‐to‐one assistance at no additional charge. Classes will be offered simultaneously in Rutland and Berlin, Vermont, with an on-site instructor at each location.

Course fee: $150. Registration discounts are available for people who have completed Growing Places and for two or more people attending from the same farm/business. Scholarships are also available.  For more information and to register visit http://www.uvm.edu/newfarmer and click on “Classes.”  You can also email or call Heidi Krantz at newfarmer@uvm.edu, 802-223-2389 x 203.

Family Systems and Farm Business

Emotional Anxiety, Entanglement, Conflict…finding a Family Leader, Neutrality and Coach-ability. These were the concepts discussed at a December training for Farm Viability business advisers provided by Erik Thompson ( http://www.thompsonleadership.com/ ). Dr. Murray Bowen described the natural emotional processes that shape how families and social units function. Bowen Family Systems Theory provides valuable concepts for farm families and farm business advisers seeking to advance common family goals and aspirations in a productive way. It is not easy! Some of the highest risk forms of chronic anxiety in a family system manifest themselves in forms of avoidance and “over-tolerance of irresponsible behavior.”

To move past that, families and family coaches need to test their own emotional maturity to promote the best outcomes. Family leaders will develop , according to Bowen ” ….with the courage to define self, who is as invested in the welfare of the family as in self….whose energy goes to changing self rather than telling others what to do….”

Family coaches and  business consultants work to establish emotional neutrality and emphasize coachability from their clients. For more on Family Systems click this link to the Vermont Center for Family Studies :   http://www.vermontcenterforfamilystudies.org/

You can also check out trainings for Social Sustainability on Farms training programs through Northeast SARE: http://www.uvm.edu/~vtsare/?Page=projects.html&SM=submenu.html

Milk Prices Dropping: New MPP Deadline Dec 19th

The USDA has extended the application deadline for the Dairy Margin Protection Program to December 19th. Milk price forecasts are showing significant decline in prices over the next several months.

Bob Parsons, University of Vermont Ag Economist, has shared these figures below that show the probability of margins dropping below various coverage levels….

“From the table below, the % numbers are the probability of return over feed cost dropping below the amount on the left hand column.  For example while the expected return over feed costs for March-April is $8.52, the probability of it dropping below $7 is 18% and 10% chance of dropping below $6.50. Remember that in the past that when milk prices drop, they tended to drop further than the markets predicted.”

Margin Level Nov-Dec 2014 Jan-Feb 2015 Mar-Apr 2015 May-Jun 2015 Jul-Aug 2015 Sep-Oct 2015 Nov-Dec 2015 Jan-Feb 2016
Expected $12.91 $9.20 $8.52 $8.64 $9.18 $10.13 $10.12 $9.79
< $8.00 - 13% 39% 39% 30% 15% 21% 29%
< $7.50 - 6% 28% 29% 21% 10% 15% 23%
< $7.00 - 2% 18% 20% 15% 6% 10% 17%
< $6.50 - - 10% 12% 10% 3% 6% 12%
< $6.00 - - 5% 7% 6% 1% 4% 8%
< $5.50 - - 2% 4% 3% 1% 2% 5%
< $5.00 - - 1% 2% 2% - 1% 3%
< $4.50 - - - 1% 1% - - 1%
< $4.00 - - - - - - - 1%

December 5th Deadline, Dairy Margin Protection Program

The deadline for enrollment in the Margin Protection Program for Dairy has been extended to Friday December 5th. MPP is a  revenue risk management tool for dairy producers when the difference between the price of milk and price of feed falls below coverage levels that farmers themselves choose. Dairy producers should contact their local USDA Farm Service Agency office to get information on enrollment this week. This weeks deadline marks the last chance dairy farms will have access to this program until 2016.

Information about the MPP-Dairy is available from USDA Farm Service Agency at this website: USDA FSA , MPP DAIRY

An online decision tool is available for farmers to use at this website: MPP DECISION TOOLThe tool allows a farmer to see the financial impact of how MPP enrollment would impact their business at different selected coverage levels. Instructions on how to use the tool are available on the website.

Farm Business Specialist Dennis Kauppila (UVM Extension) has created a simple worksheet that can be filled out while using the online decision tool. The sheet allows you to see how this program would impact your farm had the program been running in 2009 and 2012. Download the worksheet here: MPP-Dairy 3 year tables-1

Here is a list of Vermont FSA offices: VERMONT FSA COUNTY MAP (click your county on the map to get contact information)

Crop Storage Workshops and Profitability

UVM Extension Ag Engineer Chris Callahan will be offering crop storage workshops this fall. Click this link for details on events in October: Crop Storage Workshops

Inventory turnover and asset turnover are key factors to consider when you make the investment in crop storage. “Turnover” ratios provide efficiency measures that reveal how much bang you get for your buck. Here are two possible ways to improve these ratios: a) select high “value per volume” products for long term storage and b) move more product through the storage unit over the course of the year (more turns).

Quick example 1: Farmer Mark grows $25,000 of potato and has them all in storage on January 1. He sells them all winter and hits gross sales of $22,000 (there are always losses!). The cooler sits empty until next season. Thats 1 turn on the inventory, not so great. How could he improve? He could  grow a  $15,000 beet crop that fills the storage unit from July – October before the potatoes go into storage. Now he’s moving more product and increasing efficiencies by getting more product sales from the same storage investment.

Quick Example 2: Farmer Beth fills a walk in cooler with a variety of root crops in October, turnips, carrots, beets and even some cabbage. She wants to increase her profits next year. She wants to figure out which crop is worth the most in relation to the volume it requires. To keep it simple, she fills a .5 bushel box with each crop and multiplies weight x sell price. She could drop the lowest value per volume crop and grow more of the higher value per volume crop. She better factor in her marketing plan the selling costs though, high value crops may cost more to market…better keep the calculator out.

Click this link for October Crop Storage Workshops

 

Meetings to Explain Dairy Margin Protection Program

What is your plan to handle dairy milk price volatility and feed cost shifts over the next 3 years? Informational meetings are planned for October 13-17  throughout Vermont to explain the program to dairy farmers and business specialists.

Click this link for a list of sessions and locations: October Schedule: Dairy Margin Protection Program Meetings

New Guide on How to Set Farm Rental Rates

UVM Extension’s new How to Determine the Right Farm Rental Rate Guide was developed to support both farmers and landowners through the process of determining a fair cash rental rate for farmland, equipment and infrastructure in Vermont.

“Farmland and farm infrastructure rental rates can be tough to determine because there are many variables to consider,” says Ben Waterman author of the guide and land access coordinator at the UVM Center for Sustainable Agriculture. “However, the process can be simple. The guide explains common methods so farmers and landowners can forge lease arrangements with confidence.”

Divided into five sections, the 31-page guide describes approaches to:

  • Assess market rental rates;
  • Assess landowner’s costs of owning land;
  • Value equipment and infrastructure in a lease;
  • Factor the farm business’ net returns in the rental rate; and
  • Assess the farmer’s contributions to the lease arrangement

To download the guide now, go to:  http://www.uvm.edu/newfarmer/land/RentalGuide.pdf

Broiler Chicken Demand Research Report

Download the full report here:

[PDF] Broiler Demand at Small Grocers 2012-2013, FBRR-011

In the fall of 2012 University of Vermont Extension distributed a survey to a group of small  grocers  asking about chicken and egg demand in their stores with a focus on regionally-produced products. Follow-up phone interviews were conducted through the fall of 2013 to get additional feedback from the buyers in these stores. The goal of this work is to understand the demand for local poultry products and to also provide guidance for poultry farmers preparing to conduct their own market research.

Broiler AttributesThe reports provides details about which attributes consumers are looking for in poultry products and also the specific service expectations that small grocers have for farms selling them them poultry.

Click here to view or download the full report:

[PDF] Broiler Demand at Small Grocers 2012-2013, FBRR-011

 

$30,000 Prize for Rural Entrepreneurship

The American Farm Bureau Federation and Georgetown University have launched a challenge program to support entrepreneurship throughout the rural United States. They will award a $30,000 prize to the winner.

Do you have a creative business or business idea? Check out the details for this challenge and imagine what $30,000 would do to get your idea launched.

Rural Entrepreneurship Challenge