Author Archives: Mark Cannella

Grants for Dairy Farms Due February 12th

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Apply for Dairy Improvement Grants up to $20,000

With grant funds donated by Commonwealth Dairy and in partnership with the St. Albans Cooperative Creamery, Dairy Farmers of America, Housing Vermont, and the Massachusetts Housing Investment Corporation, the Vermont Farm & Forest Viability Program provides grants of up to $20,000 to Vermont dairy farmer members of the St. Albans Co-op and Dairy Farmers of America to make farm improvements. This round of funding is for projects that will improve water quality and help farmers meet new water quality regulations. Application deadline is February 12th

Click this link for application information: Dairy Improvement Grants

Job Posting: Forest Business Educator

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Forest Business Educator – Extension
The University of Vermont Extension seeks a Forest Business Outreach Educator to deliver business coaching and business management education to owners and managers of forest products-based businesses. The position will also contribute to forest and agricultural research projects. A Bachelor’s Degree in forestry, natural resources, business administration or a closely related field and at least 3 years of experience in economic development, forest products or business management education is required. The University is especially interested in candidates who can contribute to the diversity of the institution and deliver high quality outreach programs to a broad audience.
The position is located in Rutland or Berlin Vermont. This is a grant funded position. For further information and  to apply with electronic application, resume, cover letter and one page written biography visit our website at this link:   https://www.uvmjobs.com/postings/18409

10 Reasons Money Does Not Matter in Farming

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What is the best reason you have heard about why money does or does not matter on a farm? Send in a comment.

When I entered the field of farm business education and consulting I entered with the naïve perception that farm managers would seek out strategies that improved the financial performance of the farm and themselves. Time and time again my presumption has proved wrong. Here is a list of reasons that money does not matter in farming. They all come from very reasonable farmers, for better or worse.

• If we were profitable, we’d have to pay taxes to the government.
• How could we continue to market products at these high prices if people knew we were actually making money?
• It’s not about money…. It’s about the land and the animals.
• The economy/marketplace does not yet recognize the true value of what we do as farmers, someday it will.
• If we made more money, my spouse would expect to go on a vacation. I don’t much want to leave the farm and the prospect of sitting on a beach with nothing to do does not appeal much either.
• Our daughter will get better financial aid packages for college if we show a loss.
• To make more money we’d have to make some tough decisions and probably makes some changes too.
• We won’t have any retirement savings when we get old, but our kids will take care of us just like we did for our parents.
• Farming is risky business and if you can’t handle that you should get out. I heard Extension has some jobs open.
• When you work this hard and don’t make hardly anything you can’t think about money. It’s too depressing.

5 Reasons Money Does Matter in Farming
• When we decided to get a loan for a reverse osmosis unit for our maple operation it cut my labor in half and saved our marriage.
• I’d like to put profits into a retirement account so that I don’t have to parcel out the farm to support me when I am no longer able to work.
• My kids have seen us struggle to make a living on this farm for 30 years… they have no interest in farming or this place.
• I want to pay people well here and provide them year round work with good benefits.
• Making these money decisions is hard work, I figure that the only way I can justify paying myself well is by doing hard work. When I catch myself doing the things in the greenhouse I remember I can pay someone $10 per hour to do them. I need to focus on other things in order to earn my $30 per hour.

 

 

 

Winter Farm Business Programs_Sign up Now

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UVM Extension Farm Viability is offering several programs for farm managers this winter.

2016 Budget Clinics : UVM Extension Farm Business educators are available to work one-on-one with farmers on their finances. Bring your financial statements, records and questions for this 1 to 1 ½ hour private meeting at a local Extension office. Click the link above for the schedule.

Ag Biz Pro : Ag Biz Pro is the program of choice for farm managers who wish to continue working with an individual adviser after completing a grant funded Farm Viability business planning project. Participants work directly with a farm business adviser within a flexible curriculum to address priority issues facing the business through the preparation of  financial statements, financial analysis and overall business analysis.

Farm Viability Business Planning and Dairy Management Teams : Individualized and team based business planning programs run throughout the entire year. Click the program summary above and download applications from our “Application Materials” page.

Keep Laying Hens Happy and Profitable in Winter

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Newsflash… laying hens need to be comfortable and productive to maintain profitability at any scale of operation. Click this fact sheet from UMaine Extension: Bulletin #2217, Winter Care of Your Laying Hens

Some of the most important management factors to keep your winter flock laying include:

  1. Making the transition to supplemental lighting to maintain 15-16 hours of light per day (1 60 watt incandescent/13 watt compact fluorescent will cover 200 square feet). If have not done this by December, you are behind schedule. Specialists advise to increase light by 15-20 min each week  to phase light back in slowly.
  2. Keeping birds warm. Production declines below 55 d F. Managers should consider supplemental heat and also make sure the ration supplies enough energy and nutrition to compensate for the birds biological transitions with colder conditions.
  3. Never forget clean (NOT FROZEN) water, draft reductions, proper ventilation and sanitation.

Click this fact sheet from UMaine Extension: Bulletin #2217, Winter Care of Your Laying Hens

Business Basics for Loggers: Workshops Dec 7th and 8th

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UVM Extension, with financial support from VT Housing Conservation Board, is offering this one day “Business Basics for Loggers” workshop for Vermont loggers on two separate dates and locations:

December 7, 2015 – Chester, VT

December 8, 2015 – St. Johnsbury, VT

Workshop attendees will receive 8 Logger Education to Advance Professionalism (LEAP) credits. Click here for the full program flyer: Business Basics for Loggers

The Most Common Question: Rental Rates and Terms

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The most common question these days is what to charge, what to pay and how to set terms for renting agricultural assets. Follow these links to our resource library to learn more about farm rental relationships. These resources are to be used for educational purposes and we encourage you to seek consult from legal, tax and insurance professionals when establishing formal rental relationships.

Sample Lease: Multi-year

Sample Lease: Short Form

Farm Rental Rate Guide

You can also contact Land for Good. They provide limited introductory consult and additional support services to assist you with your decisions.

Spaces Limited for Winter Farm Business Planning

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UVM Extension Farm Viability provides individualized business planning support to commercial farm owners in Vermont. We have a small number of spaces left in our program for farms seeking to develop business plans or complete business analysis by Spring 2016. Sign up now or contact the program for more information. Once the winter roster is full we will begin to enroll participating farms on a short term waiting list for next years program cycle. Eligible farms are required to have been in  business for at least 3 years and show gross sales of at least $15,000 in the most recent year.

UVM Extension Farm Viability works with farms to develop business plans, complete enterprise analysis, prepare cash flow budgets/financial analysis and develop farm succession plans. Coming up this winter, our staff will also be providing additional business education programs. Watch our website for the schedule of winter 2016 programs.

 

USDA Farm Storage Facility Loans Expands to Dairy, Flowers and Meats

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FSA’s Farm Storage Facility Loan (FSFL) program, which provides low-interest financing to producers to build or upgrade storage facilities, will now include dairy, flowers and meats as eligible commodities.

For more information go to this link  to FSA Farm Facility Loans  or contact your local FSA office.

Producers do not need to demonstrate the lack of commercial credit availability to apply.

The new commodities eligible for facility loans include :
• floriculture
• hops
• rye
• milk
• cheese
• butter
• yogurt
• meat and poultry (unprocessed)
• eggs
• and aquaculture (excluding systems that maintain live animals through uptake and discharge of water).
**Commodities already eligible for the loans include corn, grain sorghum, rice, soybeans, oats, peanuts, wheat, barley, minor oilseeds harvested as whole grain, pulse crops (lentils, chickpeas and dry peas), hay, honey, renewable biomass, and fruits, nuts and vegetables for cold storage facilities.

 

Using market price reports to crunch numbers

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The VT Agency of Agricuture, Food and Markets posts weekly Farmers Market Pricing Reports at this site:  http://agriculture.vermont.gov/localfooddatatracking

These reports provide a nice way to observe the pricing trends for direct market sales. If you are already selling directly, take a look and see how your prices compare to low, high and average prices.

Covering the cost of marketing: Many small farms default to direct markets on the assumption that the higher prices received are enough to compensate for the expenses of serving these markets. The price reports provide data to crunch the numbers to compare current wholesale prices vs. direct market prices to consider your best options.

Here is a partial budget exercise using September white potato prices:

9/13/15 Report:  Organic White Potatoes: $2.50 average per pound

I can currently wholesale ORG white potatoes for $0.90 per pound or $1,800 per ton equivalent. If I were to bring them to farmers market, I could potentially gross $2.50 per pound or $5,000 per ton equivalent. Let’s crunch…

  • Farmers market = 200 pounds per week
    • market days per ton (2,000 lbs /200) = 10 days
    • market labor = 10 days x 6 hours x $12 per hours = $720
    • packaging = $0.25 per pound (labels, carton/bag) = $500 per ton
    • market fee (day fee): $35 x 10 days = $350 per ton
    • Fuel: 30 mile round trip x 10 days (@$0.13 per mile fuel) = $39 per ton
    • packaging product (retail bags): (100 lbs per hour @ $12 per hour)= $0.12 per pound or $240 per ton
    • Gross Sales $5,000 less market expenses of $1,849 = partial net $3,151 per ton
    • $3,151 = 63% of gross sales retained for production and profit
    • Cost to Market: $0.92 per pound
  • Wholesale sales = 750 pound per delivery
    • delivery days per ton (2,000 / 750) = 2.7
    • delivery labor = 2.7 delivery x 3 hours round trip x $12 per hour = $97 per ton
    • packaging = $.70 per bag per 50 lbs = $28 per ton
    • fuel: 90 mile round trip x 2.7 trips (@ $0.13 per mile fuel) = $32 per ton
    • packaging product (from bins to bags): (500 pounds per hour @ $12 per hour) = $0.02 per pound or $40 per ton
    • Gross Sales $1,800 less marketing expense of $197 = partial net $1,603 per ton.
    • $1,603 = 89% of gross sales retained for production and profit
    • Cost to market: $0.10 per pound

There is no right or wrong decision here. The big trade off is time  vs. money… the direct market farm makes much more money but has also invested ~80 hours to prep and market 1 ton of spuds. The wholesale producer earns a smaller margin but has only spent ~12 hours to prep and market 1 ton.