Agriculture Week 2022 - Where We Stand
Agriculture Week seems an appropriate time to update our customers on the state of American agriculture and in particular life at Red Land Farms.
As prices of goods and services are rising around us, we think you need to know that prices are rising like crazy here on the farm too. We’re paying record high prices for everything from fertilizer to seeds to fuel to equipment parts and labor. Unfortunately this means that’s your prices will continue soar for products in grocery stores and in home linen and clothing stores.
A Family Business
Mark and Cassandra Yeager, along with their two sons, Mark Yeager, Jr. and Joe Yeager form the partnership behind Red Land Farms which produces the cotton that makes Red Land Cotton’s sheets, quilts, towels, duvets and blankets.
Running a family farm that spans 3 generations, Mark Yeager, Sr. has seen many ups and downs in agriculture but this current rising inflation situation may prove to be the most challenging of his career.
In Spring of 2021, Red Land Farms paid $19 a gallon for various herbicides. This year that price tag is $50. Fertilizer prices are rising too. Last year’s price of urea was $400 a ton. The current price is $1,000 a ton. A Wall Street Journal article says that fertilizers prices may show as much as a 200% increase, which is an all time high. Some seed producers are estimating a 10% rise in the last quarter.* Large tractors and corn combines and cotton pickers run on diesel fuel. This year we’re paying $3.11 per gallon. That’s double the price to fuel the 2021 crop and it looks like there’s no end in sight for rising fuel prices.
Equipment parts are incredibly hard to find due to supply chain issues and labor shortages. Even when the parts you need can be located, the prices are much higher than in years past.
“Labor costs are rising because if you have a good, talented employee, you have to pay competitive wages to keep the employee. There is a serious shortage in qualified farm labor too. That drives the price of wages up because talent can always find a job in other areas.” What are the qualities needed for good farm employees? “Someone who can deal with the long seasonal work hours and experience driving large farm equipment is hard to find. Now farm employees need to be familiar with computers and able to learn to use high technology GPS programs.” says Mark Yeager, Sr.
Even though inflation is driving crop prices to higher levels, the cost of supplies to make the crops is going to make it difficult for farmers to turn a profit.
So what are farmers to do?
“ We’re going to try to make the best decisions we can in applying fertilizer and seed selection and make the best agronomic decisions possible to put ourselves into the best position possible to make a profit.” says Mark Yeager.
As far as financial strategies, Mark says “Cash is KING. We’ll try to borrow as little as possible and try to keep a close watch on every step of the crop process. A farmer’s greatest fear is to pay these high input prices and then possibly see the commodities market crash. There’s nothing we can do to stop it. It’s entirely out of our control.”
If you’re a praying person, send up a prayer for our country and the American farmer. We need all the prayers we can get. Buy American too. While we’re all hurting from this crazy inflation, remember to support your neighbors with your purchases as well as your prayers.
*Sourced in article by Patrick Thomas FARMERS FEEL THE SQUEEZE OF INFLATION, Feb.15th Wall Street Journal