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Tight cash flows leading to farm management changes

A farm management specialist with the University of Illinois says the current economy is restricting cash on hand for many row crop producers.

In a recent FarmDoc webinar, Gary Schnitkey says recent government assistance through the Farmer Bridge Assistance Program has helped, but…

“Don’t spend it all in one place, I guess.”  He says, “If we don’t get something like that for the 2027 crop, or corn and soybean prices go up considerably, we’re going to be looking at another shortage of cash flow.”

He says it’s leading some farmers to explore premiums offered by non-commodity crops.

“Non-GMO soybeans, food-grade corn, organics even.”  He says, “We do typically see those non-commodity crops having higher returns.”

He says others are scrutinizing every expense.

“The thing that is always consistent, those farms that are in the high profit group tend to be the lowest cost producers,” he says.

Schnitkey says research shows that high profit producers are focused on maximizing returns, not yields, and they’re finding ways to increase their input efficiencies.