Friday, August 10, 2007

With all that said, I find this New York Times article to be an even greater threat to the future of American agriculture:

Ethanol is feeding hot market for farmland

While much of the nation worries about a slumping real estate market, people in Midwestern farm country are experiencing exactly the opposite. Take, for instance, the farm here - nearly 80 acres of corn and soybeans off a gravel road in a universe of corn and soybeans - that sold for $10,000 an acre at auction this spring, a price that astonished even the auctioneer.

In central Illinois, prime farmland is selling for about $5,000 an acre on average, up from just over $3,000 an acre five years ago, a study showed. In Nebraska, meanwhile, land values rose 17% in the first quarter of this year over the same time last year, the swiftest such gain in more than a quarter century, said Jason R. Henderson, an economist at the Federal Reserve Bank in Kansas City.

Now, don't get me wrong. I think that the number of young people engaged in farming is the challenge. While this article lays the blame on hands of ethanol mandates, I see the problem much bigger and more complex. Investors were seeking farmland ownership long before the ethanol rage, causing land values to increase beyond what farming could return. Here is one such example from my home state of Nebraska.

Turner's land holdings keep increasing
The 100-year tenure of the McMurtrey Family at a pioneer ranch in Cherry County ended June 26 with a public referee auction at Valentine.

The real issue is the mindset of our young people believing there is no opportunity for them. I stated on Rural Route this week that the opportunities are greater than ever for young people who WANT to farm. The average age of the U.S. farmer, combined with their kids leaving the farm, creates the opportunity for sweat equity positions and purchase after a number of years working in the said operation.

I have not asked for permission to reprint so I will withhold the author's name, but here is one response I received as a result of that comment. I strongly disagree with his sentiments. What is your opinion?

Once again Trent has completely missed the mark. I have heard him espouse this before. He thinks there are legions of aging farmers who are looking for a young person to take over their farm. The fact is 99% of these farmers are only interested in selling their farm to the highest bidder and even if they want someone in particular to take over their place, it is at full market value plus a little more if they can get it.The only real issue they have is how to beat the IRS out of the tax bill. If they could figure this out, they would quit in droves. I am sure every older farmer you approach would be happy to hear that you are willing to take over the labor aspects of their farm, but when you get to the part that we then are going to split up the profits and you are going to let me buy you out at a reasonable price and reasonable terms, the deal is off. Greed is rampant is every aspect of our society and farmers are no different.

As to the question of who will take these operations over. We have seen in the past that existing operators just get larger and I believe this trend will continue and accelerate.

Trent needs to take off the rose-colored glasses.
I have to wonder who wrote that letter to you about the greed of farmers...was it Kyle? :)
Anyway, I wrote Kyle on Monday about this when I heard it on RR...While I'd like to think that young men and women who say they want to farm are willing to put in the sweat and debt to get there, I am now wondering if they will do just about anything to farm, like they claim. Or are they donning rose colored glasses thinking of farming as a romantic lifestlyle. This lasts until they see how much debt they have to go into, how much sweat they have to produce for a pittance. AND if they have to relocate, are their spouses willing to follow them?

From inside the factory, farming looks grand as they watch the local crop farmer meet his buddies at the coffee shop every other morning or drive around in brand new pick up trucks, or head to the local tractor show with his newly restored John Deere B. Or when they see how much equipment they own without seeing the payment book. Or when they look at the century old farmhouse all decorated up with a spouse inside cooking a hearty meal with a smile on her face. No, they don't see what's behind the pastoral scene: the sleepless nights, the broken fingers, the dead animals, the broken tractors, the overdue notes and the aged face that is 20 years older than it should be.

As I look at what I just wrote, I wonder to myself why every morning and every night I head out to a hot barn full of hot cows to sweat like construction worker for not enough money to pay my bills at the end of the month. Why do I do it? I think it's simply what's in you...just like Hank Vogler says, that wonderful mutant gene that we have and can't amputate. It's in your blood that no blood transfusion can take care of. Part of it is that you just have it or you don't....the other part is the support you receive from you parents and peers and then consequently from your spouse.

The sky is the limit for a man with a good mom, OR wife behind him...supporting him, respecting him and loving him.

Melissa Hart
North Adams, MI
I just figured out how to keep Loos Tales from being blocked by our server......
Whomever it was that said you were off the mark, is in a sad state of mind. Pessimistic and a "glass that's 1/2 empty" mentality.. As someone that has been experiencing just such an opportunity (sweat equity) for well over a decade, they couldn't be further from the truth.
I and now my family are very fortunate in our partnership. As you know, we are in an area marked for development. But, we have an aging partner (81 years) that wants this farm to remain as such, just because she cherishes the rural/farm lifestyle. She turns away Realtors every couple weeks. Her property has an extremely high value, but she is from a different time period, and not greedy.
We are very lucky to have an opportunity to work our way into an "Agricultural Nestegg" while beginning from zilch, zero, nothing. All because this kind lady saw something in us she liked and knew she could count on. Integrity, character, diligence, work ethic, caretaking, compassion, kindness, stewardship, love and parenting are terms in which we inherently believe.
I am sorry that people like this miss the trees while viewing the forest......
Keep up the good work,

Chuck Miller
Columbia, MO
I read Loos Lipps this a.m. and seen what the comment by a listener about "old guys dont care and want $ and no taxes". I assume he was a younger guy like myself. I do see his point though. Recently a dairy sold here for 15k+/ac to a "berry farm"(and ..other "cash" crops). The dairyman spent the last 6 years grooming his son-in-law to take over. Then when the boy went into the banker to start the process of purchase the banker said "...the farm sold last month were you been?". My cousin (the son-in-law) was devastated. Years of 60hr weeks and 40hr pay wasted. Hours of picking the right genetic now all slaughterd on the buy out. Now this is rare that the old fellow was sucha s.o.b. but it is his farm he built from nothing 30 years ago. He told me that he could nevr pencil the kid makig payments to him b/c of his debt load and retireing like he wanted. Your reader is right about 20% of the time I would think. The older generation worked harder and dirtier than my generation and wants the rewards for their dilligence. Who does not want full price? Few farmers would rather have big money than a strong legacy. Now if the family I wrote of would of started a buyout plan 6 years ago they all probly could of got what they wanted. $ to retire and a lift to get started. The # one reason we see dairies fail in familis around here if flat out lack of famiy communcation and planning. I know most farmers would rather see their next of kin farm but I think most think "why do I want them to go though this crap?". Most of us would rather see hay/corn fields than houses on our property's horizons.

See You
Troy Lenssen
This is my response to the comment recently received by Trent Loos on the future of youth in agriculture:

I’m a cattle rancher studying Animal Sciences/Ag Communications at South Dakota State University. Although my parents farm isn’t large enough for me to return to, I hope to one day be able to have a farm of my own. There is simply no better way to raise a family, and providing food and fiber for the world is one of the most rewarding careers any kid could ever dream of doing.

Unfortunately, getting into farming and ranching is a greater challenge than ever before as small farms are sucked up by corporate operations making it seemingly impossible to get started in the business. Land prices have outrageously skyrocketed, operating costs have accelerated, and there are careers outside of this industry with greater earning power.

As a young person, I realize the challenges of getting into the agriculture industry; however, this is my passion. It is quite disheartening to hear from another farmer that greed outweighs the desire to help young people continue the American farming tradition. Trent Loos doesn’t need to use rose-colored glasses to recognize that there are young people out there with the desire to own a farm and there are aging farmers with the heart to create opportunities for us.

Regardless of the challenges facing young people with an interest in agriculture, we are the future of food security and we will take a role in its success. God Bless any veteran farmer willing to help.

Amanda Nolz
Mitchell, SD
I listen to your program whenever I'm planting,
spraying, or combining. I thoroughly enjoy your
segments. I must tell you I am a young farmer from
TAYLOR North Dakota. You've been interviewing and
mentioning people from Taylor this week and I find it
refreshing to hear people from this area on the radio.
I know the Larsen Bros, Orville, and Jay Elkin. I
farm next to Jay in several locations. Just wanted to
thank you for stopping by our small community. I am a
4th generation farmer and I am in my late 20's. I
farm with my dad for several reasons. 1. I've been to
many, many land sales and I just can't compete with
the out of state hunters, or guys like Jay Elkin, who
are large farmers and have the financials to pay a
premium. I have nothing against the large farmer, he
has to do what he has to do to stay alive. As Jay
said in the NBC interview, it takes a lot of acres
just to pay for the inputs. 95% of the land I farm, I
rent which leads me to my second reason. 2. Land rents
have increased dramatically over the last couple of
years, so inputs are rising every year. It is nice to
see a good strong commodity price, but this year we
are facing sever drought, again. I believe it is an
isolated area North of Taylor, which happens to be
where all my land is located. This is the 3rd year of
drought for me. Even through these drought years, I
still look forward to everyday and I can't wait to get
out of bed and go outside and breath the fresh air and
start my day in, (as you say), my little piece of
I must tell you, my only fear is that if rents, land
values, and other inputs keep increasing and we can't
break this drought cycle, I may be forced to move on
to something else. I have a family, so if I can't
provide, I will have to find something else to do. I
love what I do more than anything and I will continue
on as long as I can. 3. Equipment. Who can afford
to go out and buy a line of equipment necessary for
production when they rent most or all of the land??
No one. Good used equipment is hard to find, its even
harder to find the money to buy the used equipment.
New equipment is basically unreachable.
4. There is nothing better than working with your
family on the farm. Everyone works in harmony
together and that makes efficiency. Efficiency is
what makes a farm successful. If you don't have it
your not maximizing your potential. It is virtually
impossible to do it alone!! You need some help and
who better than your family.
Once again, thanks for putting Taylor on the map.
Chris Bernhardt
Young Farmer from good old Taylor.