Opportunity Knocked

April 5, 2011 09:17 PM
Opportunity Knocked

Sometimes you can set yourself up for opportunity without knowing it

Sometimes good things happen to good people—especially if they’re patient. That describes how Mike Pitts and his family found themselves immersed in a brand-new farming career, launched when Pitts was on the far side of 40—the prime of vigorous life, no doubt, but "young" only in the world of production agriculture.

Transitioning from a full-time job and 400 part-time acres to almost 3,000 acres in three years was daunting at times. But the Pitts family wouldn’t change a thing. They are living a dream they had feared would never come true.

In 2006, Pitts was completing his 24th year in the grain business, as operations superintendent of the ADM grain elevator in Hoopeston, Ill. In his spare time he helped his father, Melvin, farm, while also operating 400 acres of his own, just across the state line in Indiana. Pitts and his family reside near Ambia, Ind., in the house where his grandparents lived.

"I had a good job," Pitts says. "But I always wanted to farm. I was getting older, and there didn’t seem to be any opportunities. I talked to some people about farming, but nothing came of it. I bid on cash-rented land, but I was never the winner; I wasn’t willing to offer an excessively high rent."

Throughout the years, Pitts and his wife, Tina, bought two parcels of land, totaling 140 acres. They saved their money, especially the income Pitts made by hauling grain when he had time. But at 41, Pitts says, "I was getting discouraged" about being able to farm.

Taking Notice. At the elevator, people were watching Pitts, and they liked what they saw. "I had met Mike’s dad in the National Guard, but it was at the elevator where I got to know Mike," says Delmar Graham, who before retiring farmed with his brother Dale near Wellington, Ill. "Mike treated everyone equally, and he worked hard—he was just a blur of activity at that elevator."

Although there’s a state line in between, the Graham farm and Melvin Pitts’ farm are only miles apart. "We knew the Pitts are good farmers," Dale says.

Once, Pitts asked the Grahams if they would consider renting him their land if they ever decided to retire. Time passed—five or six years, Delmar estimates.

Eventually, the Grahams’ employee became ill and had to quit. When they couldn’t find a qualified replacement, they decided to retire. There was no doubt who they wanted to replace them. "One day we said we had better quit soon, or maybe Mike won’t want to farm anymore," Dale grins.
"We had to struggle to get started in farming," Delmar says. "If we could pass that opportunity on to a deserving young man that’s what we wanted to do. We couldn’t think of a better person than Mike."

It Felt Right. "It didn’t take long to work out the arrangements," Delmar adds. "Sometimes if something looks good, you just need to go with it."

Pitts and the Grahams wrote up an agreement for Pitts to lease the brothers’ farm equipment. "Then Dale and Delmar went to bat for me with their landlords," Pitts says.

"I think when Mike asked about renting our land, he was thinking only of the small amount of land that we own," Delmar says, smiling at the memory. "I think we surprised him a little when we told him we meant our rented land, too. We were pretty close to all our landlords, and we felt an obligation to help all of them find a good tenant."

After the 2006 crop year, all of the Grahams’ landlords agreed to let Pitts farm their land—a total of 1,660 acres. Suddenly, Pitts had enough land to farm full-time.

"Leaving a good job and benefits was a big step," Pitts says. "Could I make it? After a bad day that first spring, I would think, what have I done? But then I would remember there were bad days in the grain industry, too—everybody has them."

Besides leasing the Grahams’ equipment, two things helped Pitts make the jump from 400 acres to almost 2,000 (actually 1,890—when he took on the Grahams’ land, Pitts gave up 170 acres that he had been renting in Indiana). His son Joe left his job as an electrician to come home and help farm. And the Graham brothers hired on to help Pitts plant and harvest.

opp knocked2
Retiring farmers who recommended Mike Pitts (second from right) to their landlords included (from left) Jerry Scott, Delmar Graham and Dale Graham.

Experienced Advisers. The Grahams also served as advisers. "They have a lot of knowledge," Pitts says. "They farmed a lot of years."

At the end of 2008, another farmer in the area, Jerry Scott, decided to retire. He, like the Grahams, wanted to leave the land in the hands of a certain kind of operator—"someone conscientious, responsible with money, easy to get along with," he says. The new operator should have the financial resources to handle the expansion, Scott figured. He should be young and from the local area.

Pitts was chosen to farm the family’s 1,000 acres, which upped his total to 2,890 acres.

"When I learned Joe was coming back to farm with Mike, I thought, well, we’re looking for young people in agriculture," Scott says. "Finally, I thought if Mike had what it took to please the Grahams, who were outstanding farmers, he surely would please my landlord."

When Mike asked us if he should take on Jerry’s land, Dale says, we advised him to go for it.

"Mike was hesitant [about expanding again so quickly]" Scott says. "The Grahams and his Farm Business Farm Management (FBFM) Association field man and I ganged up on him. We convinced him that, with our help, he could do it."

Gearing Up. To gear up for the increased acreage, Pitts bought a 24-row corn planter, keeping his 16-row machine for soybeans. He added one tractor to pull the larger planter and his grain cart.

Like Melvin and the Grahams, Scott helps Pitts during planting and harvest. Pitts calls the four men his support team. "It’s kind of a daily routine for me to ask their opinions about soil conditions and other things before we start to work," Pitts says. "There isn’t much they haven’t seen or dealt with."

Expanding from 400 acres in 2006 to 2,890 acres in 2009 was stressful, Pitts admits. Besides dealing with high input costs and farming more acres than he’d ever imagined, the spring of 2009 was the wettest in memory. He wasn’t able to start planting corn until late April, and then he was rained out until May 10. He finished planting corn May 23, which was good for 2009—thanks to his support team, he says.

The incredibly wet spring was followed by an equally soggy fall. Elevators were jammed with wet corn, forcing combines to sit idle, and harvest ran late. The pressure was immense. Pitts remembers thinking: "Can I get everything done in timely fashion? I’ve got to get this crop harvested because my landlords are relying on me."

Aside from 2009’s weather delays, "the mental part of expanding acres was the toughest—the amount of money you have to handle, borrow and operate with," Pitts says.

Taking Growth in Stride. Pitts never let the pressure show, Delmar says. "He took everything in stride," he says. "And—another thing we like about Mike—no matter how busy he was, his family never took second place to the farm."

Pitts is quick to credit other members of his support team with helping him grow. The team includes his wife, who keeps books, operates equipment, brings meals to the field and shares in management decisions; Joe and his wife, Trista; daughter Meghan and her husband, Ed Center; daughter Hanna, who started college this past fall; Pitts’ parents, Melvin and Mary; the Grahams; and Scott.

Pitts’ support team also includes his equipment dealer; his seed, chemical and fertilizer dealers; his banker; and his FBFM field rep. He has several farmer friends he met through Purdue University’s Top Farmer Crop Workshop with whom he brainstorms as well.

Communication with his support team, his suppliers and his landlords is a key part of Pitts’ management style.

Looking Ahead. The future? It puts thoughts in a man’s head when daughter-in-law Trista brings grandson Lucas to ride in the combine, putting four generations in the field.

Although one farm management specialist suggested Pitts try to reach 5,000 acres as fast as possible, "I’m not ready to expand anymore," he says. "I want to get this leveled out first. Maybe I don’t even need to expand anymore."

If Pitts chooses to grow some more, Delmar is certain he’ll have the chance. "I believe Mike can have a lot more ground, if he wants it," he says. "A lot of older farmers, like Dale and me, are going to have to retire in the next few years."

One thing is certain: "Five years ago," Pitts says, "if someone had told me we would be farming almost 3,000 acres, I wouldn’t have believed him." 

Talking to landlords

Communication is especially important with crop-share leases, Mike Pitts says. He has mostly crop-share arrangements, thanks to landlords who understand the risks of farming and are willing to share them.

One reason landlords grounded in agriculture appreciate crop-share rental arrangements is they ensure farmland won’t be mined or abused. "That’s something we like about Mike," says landlord Delmar Graham. "He takes care of farms just the way we did. He keeps the fertility levels up, maintains tile outlets and standpipes and keeps trees out of fence rows—that sort of thing."

In the fall, Pitts moves among all his landlords as he starts harvesting, so no one has to wait until last. It’s an opportunity that results from having all his land in one general area.

Like most farmers, Pitts is comfortable with crop production but strives to improve his marketing. Of 2010, he says, "I had a pretty good average. I didn’t price as much early but sold some at harvest and held some in storage."

Pitts knows how fortunate he is to be living his dream. "You have to have the right opportunities, or [the chance to farm] won’t happen," he says. The Grahams and landlord Jerry Scott agree that Pitts set the stage for opportunity without realizing it, by his personality and performance at the elevator, farming with his dad and hauling grain.

Now preparing to plant his fifth crop, Pitts sums up, "We have plenty of debt, and some days are better than others. But I have no regrets. I think I was getting a little bored working in the grain industry and ready for a change.

"Now I’m working with my son—an opportunity many people never have. We’re producing something someone needs—that’s very satisfying. And, in farming, unlike many other jobs, after you finish planting or harvesting, you know that task is complete.

"And," Pitts adds, flashing one of his frequent smiles, "hopefully, you make a little bit of money."

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