Ask a Margins Expert

Crop scouting may be one of your most important activities during the growing season. Scouting helps us to determine potential problems with crops and can help us to be more proactive in cases where we see problems developing. Additionally, scouting can be the best barometers to measure the results of your management decisions.

 

The biggest problem with scouting during the growing season is, it's when everyone is so busy spraying, mowing, side dressing, picking up rocks, working on equipment, and a million other activities that need to be done during the summer. If you don't have time to properly scout your own fields, it's easy to justify paying someone to do so. As we make changes in our production practices, it's critical to prioritize time to analyze and measure the results. It's pretty easy to spend $10-$30 an acre on a production change, so make sure that it pays.

 

One of my farming partners spends a tremendous amount of time during the growing season scouting crops. The potential for payback can be large. Generally, there are no big changes to be made, however, several small changes or adjustments can add up to a fairly large margin improvement.

 

Here is an example of some recent pictures he took scouting soybeans. In this instance, the field was being planted with treated soybeans, but at the end of the field they used untreated seed.

 

 

 

 

 

 

At harvest time we’ll be able to measure any yield difference, subtract the cost of seed treatment and measure the profit improvement.

 

This is just one example of a detectable problem during the growing season which may not be visibly detectable at harvest. If there is a yield difference, there would be no way to know precisely why at harvest without the correct information from scouting.

 

Margin improvements can only be made if you can measure and calculate your changes with precise information. Scouting with proper documentation will give you another tool which can help you improve profitability.

Much of the planting this spring got off to a fast start. Some areas have been able to plant the entire corn crop with virtually no delays.

 

On the other hand, there are some portions of the Corn Belt with producers who have yet to plant a kernel of corn or who have been delayed midway through their planting window. The longer these delays last and as the calendar marches forward many producers begin to question whether their initial hi bred choices will fit with later planting dates.

 

If you're planting some full season-hi breds for your area you may begin to question whether or not it's too late to maximize your profitability on a full season hi bred. Another concern may be grain moisture and harvest timeliness. While these concerns are valid, it's critical to make your decisions with statistical information as opposed to emotional concerns and frustration, which we all deal with when we’d like to see our crop planted.

 

If you're starting to get concerned about planting your full season hi breds, be sure to have a conversation with your seed professional.  Remember, there is a reason you chose your original hi breds. It's important to understand that if you do make changes midstream, there could be additional costs/risks. The seed supply for many of the top hi breds is obviously very tight this year. 

 

Making a switch could easily result in a product with less yield potential. Hi bred technology and plant characteristics can have a more dramatic impact on profitability than Crop Relative Maturity in many cases. There is also research which indicates later planted corn tends to mature faster due to daylight and heat sensitivity.

 

Ask your seed professional for report which indicates the "latest suggested planting dates for corn in your area". This information should give you peace of mind that you’re planting the best hi breds at the appropriate times.

 

The bottom line is to do your homework before you make any decisions. The one variable which impacts margins the quickest is yield. If you're going to make a change to gain on one end make sure you understand what you're giving up on the other!

 

See this PDF from Pioneer Hi-Bred which provides additional information on this topic.

 

There are never enough hours in the day during spring planting season. Even though this year has gotten off to a fast start, we all tend to push equipment and people to the limit. Rainy days are generally reserved for oil changes, repairs, and hopefully catching up on some sleep.

Consider another opportunity during your downtime. For example, many of us have experienced the first day back in the field when we remember two or three changes or adjustments to a piece of equipment we thought about making last year, but just never got to it or forgot about it. These minor repairs could have easily been fixed; however, it's the small things that get little priority. How much could the small adjustments or repairs add to your bottom line? How much does your downtime cost? Do the distractions of some of the small problems impact your overall efficiency?

There will always be breakdowns, challenges, and problems with equipment, even if your equipment is new. From year to year it's difficult to remember all of the little things. Settings, adjustments, and calibration notes can definitely help you improve time efficiency. The same holds true for carrying all of the right parts to the fields, such as sheer pins, clips, spare drive chains, and other various common replacement parts. Reminder notes from year to year don't need to be fancy. A small investment in a file box keeping notes for each piece of equipment can save a huge amount of time. At the beginning of each year you'll be able to supply each piece of equipment with the needed tools and parts to minimize downtime.

On the next rainy day spend some time writing down the things you forgot about this year. You'll be amazed at how much time it will save you next year!

Consider this; what is your time worth per hour at planting time?

If it takes 25 hours to plant 500 acres and your crop is worth $500,000 on those acres; your planting time is worth almost $20,000 per hour! This may be an extreme way to view the value of your time; however, time is always the component with most value - your equipment is at its highest value only when it's moving, instead of sitting on the edge of the field when it's time to go!

Attention to details will help to improve your margins every time!

In the last blog we discussed the comparison of planting corn versus soybeans. Profit opportunities vary greatly from one operation to the next. Some operations may benefit from all corn, while others have more profit opportunity in soybeans. Regardless of your acre mix, the next challenge is achieving an acceptable market price. Most producers have very little sold at this point, especially compared to last year.

 

Now that the spring workload has increased, it's easy to change your focus from marketing to production. Be sure to set aside some time to structure your spring/summer pricing goals. It's likely we'll see some volatility in the coming months.

 

Pricing opportunities often come when we are distracted with other tasks i.e. planting, spraying, and managing the crops. Sometimes these pricing opportunities can come and go in the blink of an eye. If you're not able to constantly watch the markets, it's critical to either have someone watching this for you or place some offers to sell the grain.

 

Assuming you have your acres plan set for 2012; you can now determine your approximate total production. Consider some of the following questions. What percentage do I have sold currently for each crop? What is my average selling price? How many bushels per acre do I currently have sold for each crop? At what price level would I be willing to price another 10% sale for each crop?

 

Once you answer these questions, it will allow you to begin your plan for the next several sales.

No one truly knows for sure what direction the markets will go during the course of this growing season. On the other hand, you can determine what price levels are acceptable, achievable, and appropriate to manage your risk and profitability. Pricing opportunities may come and go rapidly this year, make sure you have your goals set and your offers in place.

 

Be sure to use a tracking device which clearly identifies your marketing positions. This allows you to specifically manage your decisions with accuracy, confidence, and discipline.

 

Here is an example tool for keeping track of your marketing and/or pricing offers.