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Senior Contributor
ray h.
Posts: 441
Registered: ‎05-14-2010
0

Not your fathers market!

    For sure,your fathers market was not nearly as volatile was calm in comparison as far as volatility's ever when the market realized (in his day) shortages prices were way more favorable than they are today.It seems producers now days are supposed to be happy with a governor on the price spigot for the commodities they are producing.Do the math on the price of each of the grains from the 70s to now.$6.50 wheat in comparison for a current high would be about $25.00 So what is so special about any of the grain prices especially when cost of production is figured.(Oh,I forgot,we are all supposed to be farming thousands rather than hundreds of acres to make the income difference,no wander there is a high level of unemployment.)

Senior Contributor
GoredHusker
Posts: 1,709
Registered: ‎05-13-2010
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Re: Not your fathers market!

It's not just farming.  A friend of mine's dad used to work at the new holland plant there in Grand Island, NE before he retired.  If you go back to the 70's, everything was done by hand.  Today, most of it is done by machine.  Technology has displaced a huge quantity of workers.  This is one of the reasons shovel ready jobs won't fix the economy or fix the unemployment because those jobs have been replaced by machines.  One guy in a machine can more than likely do considerable more work in a day than 50 people back then could with a shovel. 

 

The size of machinery up in these parts is quite a bit larger than those down in SA.  The reason is because up here labor is expensive, thus a larger machine cuts down on labor cost.  Down there, labor is relatively cheap so they can run more smaller machines via cheap labor.  I vaguely remember yields from the 70's, but I know our yields today are considerably higher.  The only exception would be wheat.  For some reason, it doesn't seem to deviate much. 

Community Manager
marketeye
Posts: 3,250
Registered: ‎05-03-2010
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Re: Not your fathers market!

GoredHusker,

 

Your point is well-spoken and well-taken. In Brazil, the government banned human labor for harvesting sugarcane, due to its inhumane conditions. The whole sugarcane industry is expected to mechanize. This is a big problem, as many towns rely on those jobs. It will put a lot of people out of work there.

 

Mike

Esteemed Advisor
sw363535
Posts: 4,825
Registered: ‎07-18-2011
0

Re: Not your fathers market!

Gored & Mike,

 

Touching on the reason I think this is not such a good time for farming(as we know it) and good prices are making it worse.  If we had $20 corn, it would do more to accelerate the technology boom in farmnig by financing change faster.  

These are wonderful times for grain producers--------and terrible times for grain producers.

 

This has been on my mind since the meeting in Clear Lake.  Just couldn't and can't find words as good as Gored.

sw
Veteran Advisor
Palouser
Posts: 2,402
Registered: ‎05-13-2010
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Re: Not your fathers market!

I grow wheat and other small grains and some legumes and I have to say that times haven't ever been better - and I know I haven't had it as well as corn and bean in the market. Especially since we skated over the bad economy. I'm not buying the story of bad times in grains. And I think it will get better this year.
Advisor
clayton58
Posts: 368
Registered: ‎05-13-2010
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Re: Not your fathers market!

A lot of the reason for the rapid increase in mechanization is labor cost.  But I keep hearing that people can't find labor for some jobs at any price.  Even larger machinery is not a cure all.  Just ask a custom harvester how hard it is to find help.

Esteemed Advisor
sw363535
Posts: 4,825
Registered: ‎07-18-2011
0

Re: Not your fathers market!

Palouser,

 

Bad times are the small or beginning farms that cannot afford the technology and its accellerated costs.  Productivity is increasing for some not all.  The number of farms producing the grain will diminishing as much as it ever has in the last 50yrs.  High prices are not changing that.  For the small to mid sized farm that is trying to grow,  They are more likely than 5 years ago to not be able to compete at rent, land purchase, or newer technology equipment.

 

Neighbor is going through it now.  Land owners he farms for(for over 40 years) want to sell land to him.  He is only dry land and cannot afford to pay the present appraised value.  He will loose acres when it sells and helplessly watch.  And Grain prices are pushing the land prices.  

just one example.

sw
Senior Contributor
ray h.
Posts: 441
Registered: ‎05-14-2010
0

Re: Not your fathers market!

    Agree and disagree,times seem to be exelent for the grain producer.I would agree that grains have a significant chance to propel higher in the comming month,all indicaters are in a positive spin.As far as 1974-1975 wheat had way more buying power per acre than it does today at twice the money.We raised 145 bu wheat then,and that level is hard to beat today.We have a more consistant ability to produce 132bu than we did then,but huge #s like 145 were possible then!(dryland)

Veteran Advisor
Palouser
Posts: 2,402
Registered: ‎05-13-2010
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Re: Not your fathers market!

I do agree that farmers w/o a solid land base can easily be knocked out of the game. I think that has always been true. However a smaller operator with solid landlords or ownership can update now fairly easily for the size of operation they have. It may not be new but it can be newer, bigger and low hour. The wheat farmer has almost always been closest to the edge - otherwise he'd be growing row crops.
Veteran Advisor
Palouser
Posts: 2,402
Registered: ‎05-13-2010

Re: Not your fathers market!

PS - If the new farm program consists of subsidized insurance there will be a wave of consolidation never seen before.