Manage Farm Finances during Changing Financial Climate
AMES, Iowa — U.S. corn and soybean producers have enjoyed their best run of returns in history over the last seven years. But like most things that go up, crop prices and returns are likely to decline in the near future. Iowa State University Extension and Outreach farm management specialists remind producers that agricultural returns tend to be cyclical in nature, and a few years of good returns are followed by a few years of negative returns.
The ISU Extension and Outreach farm management team of Kelvin Leibold, Tim Eggers, Kristen Schulte and Ann Johanns has developed two programs to help producers manage changes in financial climate and learn how to protect their financial bottom line during years of negative returns. One program is a day-long look at the impact of changes to farm finances; the other program is a multi-session financial literacy training. Program educators are Leibold, Eggers and Schulte.
“The USDA marketing year average for corn in 2012 was $6.89; predictions going forward are showing a price closer to $4.50,” said Kelvin Leibold. “Soybeans show a similar story, going from $14.40 in 2012 to $12.15. Producers need to consider where they will be when high prices leave.”
Tim Eggers recommends producers attend the programs to assess their financial health, and agri-businesses send their clientele so they can see how a financial analysis applies to their farm operation.
Deep Water or High Tide
This financial program will be offered at three locations in February. Program participants will learn how changes to interest rates and other input costs affect their net farm income, and how to manage these changes.
The program consists of a day engaged in the game of farm finances. Participants will gain a greater knowledge of a true-to-life financial picture by taking part in a case study simulation. Extension team leaders will guide participants as they work together through the basics of having a solid financial foundation.
All sites begin at 9:30 a.m. and wrap-up at 3:30 p.m. Registration is $25 at all locations. To register, contact the county extension office for the preferred location listed below.
Cresco, Northeast Iowa Community College
Monday, Feb. 24
Contact: Howard County Extension Office, 563-547-3001
Iowa Falls, ECC Agriculture & Renewable Energy Center
Tuesday, Feb. 25
Contact: Hardin County Extension Office, 641-648-4850
Shenandoah, Iowa Western Community College
Thursday, Feb. 27
Contact: Page County Extension Office, 712-542-5171
Moving Beyond the Basics
This multi-session program focuses on financial literacy and takes learning to a deeper level. Moving Beyond the Basics is modeled after the nationwide Annie’s Project for Farm and Ranch Women. “This program will give women the opportunity to evaluate record keeping systems and test-drive accounting software in a classroom setting,” said Kristin Schulte. “Knowing the resources available for analyzing your financial position will make you better able to ride periods of low prices and farm income.”
Cass County Extension Office, Atlantic
Monday Evenings; Jan. 27– Feb. 17; 6 - 9 p.m.
Contact: Kate Olsen at 712-243-1132 or Tim Eggers at 712-303-7781
Chickasaw County Extension Office, New Hampton
Tuesday Evenings; Jan. 28 – Feb. 18; 6 - 9 p.m.
Contact: Danielle Day at 641-394-2174 or Kristen Schulte at 563-547-3001
Hardin County Extension Office, Iowa Falls
Wednesday Evenings; March 5 – March 26; 6 - 9 p.m.
Contact: Kelvin Leibold at 641-648-4850
Deep Water or High Tide and Moving Beyond the Basics are being offered at various locations in Ohio and Iowa and have been developed through a grant from the North Central Risk Management Education Center and USDA National Institute of Food and Agriculture.
Visit the Ag Decision Maker website for further details, www.extension.iastate.edu/agdm/.