August 2018 Newsletter
Whats Going On At The Farm August 2018
Every month I sit down at this computer and write this newsletter. My goal, is to tell everyone what happens on this farm monthly and try to give everyone a small taste of what farm life is about. I tell about how the weather is affecting the animals, about new litters of pigs or calves that were born, or how hot it was when we were baling hay. I try to tell about how the farm has grown, what new things we are trying, and what we expect the results of those trials to be. Lately I've spent a good amount of time talking about the declining farm market sales, and have asked for feed back as to why this is happening. And last month I mentioned that for the past 3 to 4 months we have been plagued with equipment breakdowns and that we would have to make some important decisions in the upcoming weeks. I'm not trying to bore the reader or play the sympathy card, I'm simply trying to give a true and honest picture of what life on a farm is all about. After all, farm life isn't just about beautiful sunrises and sunsets, wildlife seen in the back fields, geese seen flying overhead on a cool winter morning, or the spring return of the Martins to our gourds in front of the house. Life on a farm is stressful, in fact, farming is one of the most stressful professions a person can participate in. A farmer can expect to work long hard hours and must learn to accept success and failure, yet have the drive to roll up their sleeves and try again. A farmer must be willing to gamble everything he has, every year, and find a way to raise a crop and make a profit. Farmers will take time away from family activities and forego a large amount of personal time that might have been used hunting, fishing, or simply relaxing because there is always something that has to be done on a farm. Years ago I used to read articles and books that called farming a lifestyle, and I guess to a point it is, but farming is really a business and one of the toughest businesses a family could ever imagine being in.
August 1st is always the day Annie and I have to pay our annual farm operating loan back to our ag lender. Compared to other, larger farms, our loan is small. I know some farmers that plant 1,000 or more acres that is split between corn and soybeans. Some of these farmers will also mix in a few fields of cotton or tobacco to round out their crops. One farm that we are friends with has an annual operating loan that is in excess of $750,000! Everything that family ownes is tied up as colateral for their annual farm operations loan. If they don't make a crop for any reason, and they can't pay their loan off, they can lose everything they have worked their whole lives for. Sure there's crop insurance but it doesn't cover the total cost of planting a crop and doesn't pay 1 cent towards paying the families bills for the year.
I'm mentioning this because of a problem that we may see occur this coming winter or next spring when row crop farmers typically pay off their last years operating loan and sign the paperwork for the current year loans. This is normally done after the last years harvest, allowing time to complete sales, and before the farmer would need to purchase their seed, fertilizer, and chemicals for the current year. Because of the current economic situation from the recently imposed tarrifs, and the declining prices on soybeans, corn, sorghum, hogs, and other commodities, many farmers may not be able to pay their loans off and could be forced to liquidate their farms. Many farm analyists are saying this is a very real problem and that farmers need to do whatever they can to secure their financial positions now. For some, that may be too difficult to do considering many commoditiy row crop farmers have been selling crops at breakeven prices for the last 3 years and are being faced with even lower prices now. Things haven't been this tough for row crop farmers since the 80's. Please keep these farmers in your thoughts and say a few extra prayers for them; they could really use them now.
As I mentioned, August 1 is the day we pay our farm loan off. We paid the loan off as expected and signed the paperwork on the new loan a couple of days later just like the majority of farmers across this country do every year. We have set our own personal goal of making 2018-2019 the last year that we will have to renew this annual loan.
Over the past few years we've mentioned that Annie and I have begun to transition the farm over to amy and Jesse. This process will take 5 to 7 years and is a lot more complicated than we previously thought. Sure we have to make sure that Jesse and Amy understand the daily farm routine, what to look for when checking on the animals, and the things to look for when an animal is sick. They have to learn how to keep the pastures up, how to grow and bale hay, how to fix fence, and the importance of rotating the cows to a new pasture. They are learning these tasks well and should be ready to take the farm over today if anything happened to Annie and I.
Jesse and Amy also have to learn the business side of the farm and this is where things get very complicated. Though Annie and I have been farming since the mid 80's, we didn't start farming the way we do now, or selling our products direct to families and restaurants, until 2005. When we switched to our current type of production systems, we had to invest large sums of money into building new structures and pastures. We had to purchase equipment that we hadn't required before like refridgerated trucks, a larger livestock trailer, a large walk in cooler and freezer, and even chicken crates that are needed to haul chickens to the processing plant weekly. This is where running the farm gets complicated and is the next area that we have to work with Jesse and Amy on.
Late last fall we hired a CPA to help organize our Quickbooks program specifically for us. The goal was for him to build reports that we could easily run and quickly get the information that we required. What he accomplished has made our life so much easier. That was some of the best money we could have ever spent.
Apps that Amy found and installed have helped us keep track of sales, what items we sell the most of, and where the sale was made. She found an app that allows this information to be downloaded automatically into Quickbooks saving Annie 4 to 5 hours work a week. Amy also found an app that we all have loaded in our phones that allows us to keep track of live animal inventory and processed inventory that is in our freezers. We can even track how much feed was given to any flock of chickens during their time on the farm. One of the best things about this is that I can get all of this information, as it is entered, no matter where I am.
Late this past winter, or very early spring, we found a vet that made house calls. We brought him out to the farm so he could evaluate our processes, check out our animals, and provide us with recommendations of what we could do better. After he reviewed his notes he sent us a list of recommendations which we have since begun following. We also have made him our farms Vet and have consulted with him on a few issues when needed.
The next step in our transition process was to make sure we had all of the financial issues taken care of. We didn't feel it would be right to turn a farm over to Amy and Jesse that had more than the minimum amount of debt required or leave them a bunch of old equipment that was in constant need of repair and that would have repair costs draining the farm dry. We knew this stage of the transition process would be the most difficult and time consuming. Even with the other stages of the transition handled properly, it could take several years to insure the farms financial future was secure. With being 3 years into the process, we felt we needed to begin handling this stage now. To help us through this process we brought in a financial advisor. The financial advisor we have has been a customer of the farm for several years. He has seen the farm grow, has some ideas of the issues we face, and is a true beleiver in what we produce and how we produce it. What I like about him the most is that he is a straight shooter and isn't afraid to face the tough issues head on.
Over the past couple of months working with the advisor, we have looked at several areas of the farm. As I mentioned last month, we have been having a rash of equipment breakdowns, most of them being associated with our 3 refrigerated trucks and a pick up that we use to pull our livestock trailer to and from the processor. My feeling was that we keep repairing the trucks rather than purchase replacements. I was looking at the cost of a new truck and not considering how much we were spending monthly to keep our current trucks running or the fact that we had to have extra trucks to use in case of a breakdown. It didn't take long for our advisor to prove to me how foolish my thinking was and show me how much we were really spending on repairs. He also pointed out our goal of not leaving Jesse and Amy a bunch of worn out equipment that they would have to repair or replace. We now have a new truck ordered that will be used to pull our livestock trailer and plan on ordering a new refrigerated van in the next week or so.
The work we are doing with our advisor is more than expected. He knows what our transition goals are and is focusing on those goals He is forcing us to look into details of our operation that we hadn't thought of before. We're developing business plans that will be used annually and allow us to forcast our infrastructure needs and prodict our capital requirments, through 2025. Annie and I realize that most of the transition process should be complete well before 2025 so are expecting Jesse and Amy to provide us with their vision of what the farm should look like by then and what path we need to take to get there. Doing this will allow a smooth transition and allow Jesse and Amy to take over a farm that is as debt free and self sustaining as possible.
I'm sure this newsletter has bored most of you to tears by now. I better mention a few things before closing if your still awake.
Sales at the Summerville Farmers Market remain slow, forcing us to continue on an every other week schedule. Hopefully once the weather cools business will pick up and allow us to be there weekly. We will continue to be at the Port Royal Market weekly.
Home delivery has been growing monthly and may be an option for those of you that don't like farmers markets or are too busy on Saturdays to visit a market. Pastured Pantry has increased the coverage area and are now going to Beaufort and Bluffton along with their normal routes in Summerville, Goose Creek, Moncks Corner, North Charleston, West Ashley, Mount Pleasant, downtown Charleston, and Johns and James Island. I don't think there is an easier way to get our products than delivered directly to you home or office. Don't keep this service a secret, tell all your friends.
Thanksgiving is right around the corner. If you want one of our turkeys for Thanksgiving, it needs to be ordered now, we only have a few left.. I know we will have a good number of turkeys that are missing a wing tip or a whole wing, this happens every year during processing. If you are ok with getting one of these birds please let us know; this will greatly increase your chance of getting a late ordered bird and will help us provide turkeys to everyone that wants one. Turkeys are ordered on the website.
Speaking of turkeys, we have a good amount of turkey sausage available year round. To my knowledge we have the widest selection of pastured turkey sausage in the area. If you know of anyone that prefers eating turkey sausage over pork sausage, please tell them about us.
September is a month of change. The humidity begins to drop, the weather gets just a little cooler, and we begin seeing fall vegetables at the local markets. Things begin changing on the farm for us as well; the grass growth slows, winter grazing is planted, animals become more active, and we begin planning and preparing for the winter projects that we have scheduled.
We thank you for your continued support and encourage everyone to drive out and visit us at the farm. I promise not to talk business next month and will concentrate on the other side of farm life.
Annie, Marc, Amy, & Jesse