A Tough Spring

Posted in Farming on Tuesday, May 05, 2015

A Tough Spring

It has been a difficult spring: falling yields, falling prices, and failing equipment.  Warm and dry in February, we started seeing then just how badly November’s cold and lack of snow had treated the winter wheat, our primary crop.  The price of that crop has been sliding for a long time, and the May 2015 price is $2.00 per bushel less, 25% less than a year ago.  More winter wheat was re-seeded in my area this spring than I have seen for a decade or so and there is a lot of winter wheat that wasn’t re-seeded (like my own) that should have been.

Deciding to stick with a damaged winter wheat crop or to re-plant to spring wheat is a difficult decision.  In February when we were first assessing the damage, we tried to guess how much the winter wheat would recover.   Given the right conditions, it may be OK.  Given the right conditions, the remaining surviving plants may compensate for the thinned out plant populations – or maybe not.   I have heard of farmers who have made 3 trips through their winter wheat fields, re-seeding more acres each time as the stands continued to deteriorate from February to May.

Beyond the economics of the yield decline from a weather thinned winter wheat crop, the longer term agronomics are a serious concern as well.  Weeds are natural opportunists, and any soil surface left vacant by the death of a wheat plant is a great opportunity for weeds to grow and make a lot of seed.  This reduces harvest quality and provides plenty of competition for crops for years to come.

A winter kill year like this happens about once a decade, and it is always a scramble for the seed industry to come up with enough spring wheat seed of the right kind to match the winter killed crop.   Seed is somewhat perishable, losing its ability to germinate over time, so seed dealers cannot simply sit on a large inventory, hoping next year is the year when the winter crop will be damaged enough to make farmers buy a bunch of spring wheat seed.  High quality spring wheat seed can get to be hard to find in years like this, but the industry generally manages pretty well to find enough seed to meet the unexpected demand.

Unexpected demand could be great for the price of wheat right now, but that isn’t likely to happen.  In addition, the world appears to have plenty of wheat for the moment, and foreign buyers are able to get the wheat they want without having to offer the 25% higher price they were offering one year ago.  On top of that, the U.S. dollar has increased in value in relation to other world currencies.  It now takes more Yen or Yuan or Baht to buy U.S. wheat than it did a year ago, and the business is going elsewhere.   Long story short: the price outlook for this year’s expectedly meager crop is not good.

And then there is my equipment.  I am trying to keep focus on the, “My,” of ‘my equipment,’ as in mine -and not the banks.  Call it my positive spin on 2015 spring work.  The secret to owning all your farm equipment debt free is summarized in these three factors: used, old, and cheap.  The downside is that those three factors also correlate with leaking, broken and obsolete, and this spring, a lot of things that never leak, leaked.  A lot of things that rarely break, broke, and there were even a few dramatic instances of metal fatigue in non-replaceable parts. 

When household items get broken, you mostly end up with trash.  When farming implements get broken, you mostly end up with scrap iron and broken hydraulic hoses.  It has been a tough spring.  Without looking at the ugly winter wheat fields, or the sagging commodity markets, I can tell by the size of my scrap iron pile. 

But we have survived.  The work got done.  The crops are growing.  I even have all the broken pieces picked up.  Now, if it would only rain.  You could quickly make yourself crazy by worrying about the weather, but short of praying, there is not much any of us can do.  Instead, we will drag the broken pieces into the shop, fire up the welder, call the parts people, check the ads for bargains to replace what can’t be repaired, and repair everything else for next fall’s field work – all the while, keeping an eye on the commodities market and world crop conditions for changes in the markets.