Inputs Monitor Editor Davis Michaelsen adds his perspective into the happenings of the inputs markets.
Miles & Miles of Monitor -- Balance
Jan 18, 2013
The last two stops on the Pro Farmer Profit Briefing Seminar Series were Lafayette, Indiana and Peoria, Illinois. It was a long, sprawling drive across the Midwest from Cedar Falls to Lafayette. We put on 1000 miles in a lumbering haywagon of a van, but the growers and old friends along the way made it all worth while.
Lafayette, Indiana --
This was great group with important things on their minds. Part of the inherent value of the Inputs Monitor is that it helps the grower avoid making nutrient decisions based on price. My message was not to let fertilizer pricing dictate the nutrient profile in the soil. In a previous blog, I outlined how much per-acre a grower should pay for NPK saying that 18% of expected new-crop revenue is where growers either postpone purchases or make the decision to spend a little less on P&K to ensure enough Nitrogen is applied.
I used India as an example. India uses around 30 million tons of Urea each year but only 4 million tons of Potash. Just about any soil can weather a few years with such an imbalance, but it wouldn't take long before the nutrient profile is completely out of balance. India's imbalance is directly related to price.
A government fertilizer subsidy policy in India so firmly favors Urea that most growers cannot afford to buy anything else. The resulting imbalance is creating dramatic social problems and has contributed to a very high suicide rate among farmers in India. Every eight hours, a grower in India finds himself so burdened by debt in an economy where the currency continues to slip, that he takes his own life.
This leaves farm widows to struggle with that debt with limited job opportunities, young mouths to feed and slim prospects for remarriage. Fertilizer pricing dictates the nutrient profile in India and the consequences are dire.
Here in the United States we have the good fortune of having a variety of safety nets in place to keep farm debt from impacting life on the farm to such tragic ends. But the example does show how making decisions for your nutrient profile based on price can go horribly wrong. The Inputs Monitor stands to keep growers and retailers informed and to help producers make good decisions based on the good 'ol four R's.
Find the right source for your nutrient, make purchases at the right rate and the right time, and put the right stuff in the right place. Now I've taken a few liberties with the spirit of the 4R's here as they are usually thought of in the context of application. But the Monitor is all about helping growers and retailers connect tried and true 'old school' methods, with the power of modern information.
Peoria, Illinois --
I met a man from south of Peoria who had been in the fertilizer business since he was twelve. He took the time to tell me about his first day on the job in the fertilizer industry. "I was twelve," the man reflected. "My first day on the job I cut in anhydrous on a '52 Ferguson with a three blade setup. The rows were long -- had to have been a good half mile from one end to the other. One of the other co-op guys was with me and he'd help me refill my tank at the one end of the plot.
I was turning around at the far end on a run when I saw a burst of white at the other end of the field. As I looked, my refill guy went sprinting across the horizon and dove into a horse tank they had out there. I sped across that field at all of what felt like 2 miles per hour to see what had happened.
When I finally made it to the other end, I found the guy sitting in the horse tank. He wasn't able to talk but he looked pretty bad so I knew I had to get some help. We were out in the middle of nowhere, but somehow, somebody had left a Plymouth parked nearby with the keys still in it. The closest hospital was about 15 miles away and I had the sense not to try the trip on the tractor.
I helped him into the Plymouth and we took off, hell-bent-for-leather with me (a twelve year old kid) behind the wheel. We made it to the hospital and he ended up fine, but he had severe anhydrous burns up his right arm and had swallowed some too...that's why he couldn't talk when I found him.
He had been fiddling with the anhydrous tank, and he lost his balance and hit a valve that released the juice on him. Lucky thing that horse tank was out there. He might have been killed, or worse!"
The man, now retired, was kind enough to let me pick his brain a little regarding NPK. He had been in charge of over 200 retail locations at one point and he reaffirmed that the fertilizer game has changed. All the tricks and tips these old timers have used throughout their careers are only half of what the modern farmer must know. "Back in the day, we didn't have to worry so much about fertilizer prices changing that much so it did make it a little easier...one less thing to worry about," the man said.
His advice to the modern grower was "Do not forget what grandad always did. Those guys knew what they were doing and just because they didn't have computers to help, doesn't mean it didn't work. But at the same time, a guy could fall behind nowadays if he's not on top of what's happening and what's new."
I thought I had a lot figured out when I started on the Profit Briefing trail clear back in December. I could not have anticipated how much I would learn -- and how willing farmers and retailers would be to share some of their knowledge with me. I look forward to my next opportunity to address a group of growers. Not because what I have to say is so smart -- it is because of what I have to learn from shaking hands and eating fried chicken shoulder-to-shoulder with growers.
Thanks to everyone who made it out to be a part of this year's Pro Farmer Profit Briefing Seminar Series. Miles & Miles of Monitor taught me the real benefit of the speaking trail isn't when I speak -- it is when I listen.