Content by Heather Gessner

a new small plant growing out of the soil

SDSU Extension to Address Economic and Marketing Issues in Crop and Livestock Production During Ag Economic Dialogue Series

August 06, 2020

SDSU Extension will host monthly Ag Economic Dialogues throughout 2020 to assist farmers and ranchers in making the best and most profitable decisions for their operations.

A small herd of cattle grazing in snow-covered, spring pasture.

Bunch the Cow Herd

Reproduction is one of the biggest drivers of economic success. Cows stressed by cold, wind, snow, and mud will put energy resources into body condition maintenance and lactation prior to recycling.

various white charts and bar graphs on a blue background

Grain Storage Calculator

An Excel based spreadsheet for corn, soybean, spring and winter wheat producers.

A field of standing corn covered in snow.

The January 2020 South Dakota Crop Progress Report indicated four percent of S.D. corn acres remain in the field. Given the record rainfall of 2019, current snow pack levels and the 3-to-6-month precipitation forecasts, farmers will likely be dealing with a wet spring in 2020, thus making the removal of those acres important but hard to accomplish.

A green cut alfalfa field dries as the sun sets.

Forage Resources Available to S.D. Farmers and Ranchers

Forages are a very important part of the South Dakota livestock and cropping industries. Often, producers have difficulties finding enough forage for their herd or locating a fellow producer to buy, sell or rent forages and grazing acres too. South Dakota now has two widely-recognized, free resources to aid in these connections.

A pen and calculator sitting next to an accounting binder.

Bookwork, The Missing Management Component: Consistency of Financial Records

Consistent record keeping will allow for accurate ratios and trend analysis. While operations will change, grow, or contract, having a standard operating procedure will allow for analysis and decision-making.

A male with three female farm administrators reviewing a binder of financial records. Courtesy: USDA

Bookwork, The Missing Management Component: Balance Sheet Valuations

The financial crash of the 1980’s has been attributed to changes in producer’s balance sheets, due to a decline in land prices. After this time, a two-column balance sheet was developed to help prevent that type of balance sheet collapse from occurring in the future.

Farmer sitting inside the cab of a green tractor parked inside a machine shed.

Bookwork, The Missing Management Component: Depreciation Determination and Use

Another component of determining net income is depreciation. This is one component of the Schedule F that many understand the least. Typically, the most use it gets is to minimize income tax through accelerated tax depreciation under section 179.

IRS Schedule "F" Form, Profit or Loss From Farming

Bookwork, The Missing Management Component: Farm Income Determination

Many ag producers do not like bookwork. Many times this job gets pushed to the side, until a bill is due or taxes need to be filed. It is also fair to say it is a missing component to the management of most operations. A missing component that could lead to the collapse of the operation.

sun rising over a cornfield. several grain bins are in the background.

Marketing Mindset Change

Marketing for profit may not seem new to producers, but the way they look at their marketing plans should be.