HI54UNI wrote:Click bait type article -
$300,000/$8.80 (current soybean price) is about 34,000 bushels. On 1,000 acres that's only 34 bushels per acre. Either the land is really shitty and shouldn't be used for soybeans or the damage was so bad his taxpayer subsidized crop insurance paid him off. My guess would be the latter because there is no way a farmer would plow under $300,000 even if he had to pay storage, damage, etc. Better to have something rather than nothing. Also I have little sympathy for a farmer that farms 1,700 acres of soybeans. Odds are he's farming double that acreage with other crops.
The glut in grain stocks has been building for years now because of too much over production, some of which is encouraged by subsidized crop insurance. Farmers around here have plowed up pastures, waterways, etc. because as long as they get a crop planted they are guaranteed to get paid even if it floods out every year. There are grain piles around because yields were good and there isn't enough storage. The China tariffs are making the problem worse but are just a convenient boogeyman.
Interesting that the article talks about privately owned grain elevators. Most around here are cooperatives. Are the coops screwing their farmer owners too? Maybe the farmers need to start cooperatives instead of relying on private entities if they feel they are getting screwed. And fees for damaged crops are nothing new. Happens all the time.
Why didn't these farmers save their money 5-7 years ago when the markets went crazy and corn was $7 per bushel?
Yup, family was just talking about this situation over Thanksgiving dinner. Nothing new here, farmer was paid through crop insurance (nobody that size doesn't have it and it is tied to receiving your operating loan).
Lot of younger farmers spent the money from the good years like a drunken sailor and didn't put any aside for the lean years. Equipment manufactures offering cheap loans for them to trade up every year meant that lot of farmers took advantage of it and lived on credit, knowing that the bank or crop insurance would bail them out the first year. Now we are a year or two past that and they still haven't changed their practices. To borrow an old saying, the chickens are coming home to roost.
Farmers that operated within their means, and expanded wisely within their operating capital will be sitting good here coming up. It will not be easy but they will have the reserves to last this out. But they will not be the ones making the news as their "story" doesn't further the agenda.
