Dear friends,
There was an article in my local newspaper the other day that caught my eye and, as I read it, reminded me of a story from the Old Testament. The article was about a meeting held in the community to make people aware of the current "landscape" of farming, how it looked a decade ago compared to how it looks today. The one part of the article that really caught my eye was entitled "Break-even farming." In this portion of the article it spoke first of the high prices that were experienced in farming from the years 2008-2013. During those five years "farmers profited to an unprecedented degree." In 2013, corn was selling for almost $7 a bushel and beans were as high as $14-15 per bushel. Today, they are selling for a little over $3 for corn and under $9 for beans. The high profits were obviously welcome, but one of the negative results was an over-abundance of corn and beans. Everyone wanted to take advantage of the high profits and so everyone got busy raising as much corn and soybeans as possible. This, among other factors, has contributed to the state of farming today. A friend of mine often uses the image of a pendulum swinging back and forth. Unfortunately for many farmers, the pendulum got so far out in one direction that when it came back, many were not prepared for the force with which it would need to use in order to restore some sort of balance to the market.
The article went on to talk about how prices have now come back to what one speaker termed "break-even" farming, where the input costs are not much lower than the revenue generated by the crops. The speaker went on to say that the break-even model was basically what the business of farming looked like for about three decades, until that spike in prices began about ten years ago.
Not to mention that the world of agriculture has only gotten to be more global than it was even 20 years ago. A new model is taking shape and farmers need to watch it closely and adjust accordingly if they are going to survive and thrive in this new economic environment.
I mentioned in the beginning of this post that the article called to my mind a story from the Old Testament. The story is of Joseph, son of Jacob, that dreamer who received from his father a multi-colored coat which threw his brothers into a collective jealous rage. Long story short, Joseph grew up in the land of Canaan with his father and brothers, but his fiendish brothers got rid of him and he ultimately ended up in Egypt where, through a series of bizarre events, he ended up becoming the right-hand-man to the Pharaoh of Egypt, the most powerful man in that region of the world at that time. The main reason Joseph garnered such favor with the Pharaoh is the Pharaoh was having these crazy dreams (which, at that time, people put a lot of stock into the meaning of their dreams) and none of his advisors could tell him what the dreams meant. Here are the gist of his two most troubling dreams: Dream #1 - Seven sleek, fat cows came up out of the Nile River and were grazing on the riverbanks. Then, seven gaunt looking cows came up out of the river and ate the seven fat cows. Dream #2 - Seven healthy heads of grain grew up on a single stalk. Then, seven more heads of grain grew, except these were thin and scorched by the east wind. Just as with the cows, the seven thin heads of grain swallowed up the seven healthy heads of grain.
Joseph understood what the dreams meant and explained them to the Pharaoh: The seven fat cows and the seven healthy heads of grain represented seven years of plenty. The seven thin cows and thin heads of grain represented seven years of drought and famine. Joseph advised Pharaoh that in order to prepare for the seven bad years, he needed to properly plan how to take advantage of the seven years of plenty. Because Pharaoh had come to trust Joseph, and considered him wise, Pharaoh put Joseph in charge of creating such a plan. And Joseph's plan worked. When the rest of the region was suffering on account of the seven years of drought, Egypt continued to flourish.
The lesson from that story, and from the article on "break-even" farming, is basically the same. We never want to let our guard down and assume that the good times are here to stay. The good times are meant to be an opportunity to properly prepare for when the more challenging times come, because they always do. It is that swinging pendulum.
That is my thought for you today, my friends!
Peace,
Julie
There was an article in my local newspaper the other day that caught my eye and, as I read it, reminded me of a story from the Old Testament. The article was about a meeting held in the community to make people aware of the current "landscape" of farming, how it looked a decade ago compared to how it looks today. The one part of the article that really caught my eye was entitled "Break-even farming." In this portion of the article it spoke first of the high prices that were experienced in farming from the years 2008-2013. During those five years "farmers profited to an unprecedented degree." In 2013, corn was selling for almost $7 a bushel and beans were as high as $14-15 per bushel. Today, they are selling for a little over $3 for corn and under $9 for beans. The high profits were obviously welcome, but one of the negative results was an over-abundance of corn and beans. Everyone wanted to take advantage of the high profits and so everyone got busy raising as much corn and soybeans as possible. This, among other factors, has contributed to the state of farming today. A friend of mine often uses the image of a pendulum swinging back and forth. Unfortunately for many farmers, the pendulum got so far out in one direction that when it came back, many were not prepared for the force with which it would need to use in order to restore some sort of balance to the market.
The article went on to talk about how prices have now come back to what one speaker termed "break-even" farming, where the input costs are not much lower than the revenue generated by the crops. The speaker went on to say that the break-even model was basically what the business of farming looked like for about three decades, until that spike in prices began about ten years ago.
Not to mention that the world of agriculture has only gotten to be more global than it was even 20 years ago. A new model is taking shape and farmers need to watch it closely and adjust accordingly if they are going to survive and thrive in this new economic environment.
I mentioned in the beginning of this post that the article called to my mind a story from the Old Testament. The story is of Joseph, son of Jacob, that dreamer who received from his father a multi-colored coat which threw his brothers into a collective jealous rage. Long story short, Joseph grew up in the land of Canaan with his father and brothers, but his fiendish brothers got rid of him and he ultimately ended up in Egypt where, through a series of bizarre events, he ended up becoming the right-hand-man to the Pharaoh of Egypt, the most powerful man in that region of the world at that time. The main reason Joseph garnered such favor with the Pharaoh is the Pharaoh was having these crazy dreams (which, at that time, people put a lot of stock into the meaning of their dreams) and none of his advisors could tell him what the dreams meant. Here are the gist of his two most troubling dreams: Dream #1 - Seven sleek, fat cows came up out of the Nile River and were grazing on the riverbanks. Then, seven gaunt looking cows came up out of the river and ate the seven fat cows. Dream #2 - Seven healthy heads of grain grew up on a single stalk. Then, seven more heads of grain grew, except these were thin and scorched by the east wind. Just as with the cows, the seven thin heads of grain swallowed up the seven healthy heads of grain.
Joseph understood what the dreams meant and explained them to the Pharaoh: The seven fat cows and the seven healthy heads of grain represented seven years of plenty. The seven thin cows and thin heads of grain represented seven years of drought and famine. Joseph advised Pharaoh that in order to prepare for the seven bad years, he needed to properly plan how to take advantage of the seven years of plenty. Because Pharaoh had come to trust Joseph, and considered him wise, Pharaoh put Joseph in charge of creating such a plan. And Joseph's plan worked. When the rest of the region was suffering on account of the seven years of drought, Egypt continued to flourish.
The lesson from that story, and from the article on "break-even" farming, is basically the same. We never want to let our guard down and assume that the good times are here to stay. The good times are meant to be an opportunity to properly prepare for when the more challenging times come, because they always do. It is that swinging pendulum.
That is my thought for you today, my friends!
Peace,
Julie
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