Page 6—Com Talk, Lancaster Farming, Saturday, February 10, 1996
To Benefit From Managing Risk
ANDY ANDREWS
Lancaster Farming Staff
CARLISLE (Cumberland
Co.) —Cash crop com growers
can no longer think of simply
growing their crops and selling
them. Those days are gone.
It’s time for the day of the
marketing plan.
As a grower, if you don’t
have a plan, as the market
becomes increasingly complex
and volatile, it can cost you lots
of money in lost profitability.
Not having a plan can even cost
you money, period, according
to one grain buyer during the
com growers segment of the
annual Pennsylvania Crops
Conference last week at the
Embers Inn.
Don Newhard, Newhard
Farms in Lehigh County, grows
a variety of crops on 1,400
acres of mostly rented ground,
including com, sorgum, wheat,
barley, sweet com, alfalfa, and
“plenty of houses.”
The “houses” part is a reali
ty that many growers have
learned to live with in that part
of the state, with increasing
development pressures.
“We have a saying,” said
Newhard, “that the last crop is
A panel at the Pennsylvania Crops Conference focused on managing risks
In com pricing. From left, Don Newhard, grower from Lehigh County; Bill
Robinson, president of Cramer Feeds; and Tom Murphy, Lycoming extension
agent, moderator. Photo by Andy Andrews
Efficiency is The Key To Profit!
We test your soil and make
recommendations as to needed
nutrients, based on:
• The capacity of your soil to produce
• The genetic production potential of
your crop,
• The type of livestock you are feeding.
• CSA Liquid Micro Nutrients * Organic Blends
Manufacturers of
Seven Lick Dutch Country Brand Fertiiizers
Symo-Life, Inc.
fO] L/| 3507 US 62
Millersburg, Ohio 44654
Com Growers Can Leam
blacktop, and believe me, the
paver is busy.”
In the old days, according to
the com grower, a grower simp
ly trucked the product to the
mill and back, empty. “We
paid the bills. We existed,” he
said. “We were not exactly
marketing in the fall at the
upper one-third of the price
range.”
As a result, a move has been
on in recent years to develop a
grain marketing club. The
Lehigh Valley Grain Marketing
Club started and has helped the
club get the best price for their
com through a variety of
options available to every
grower.
Newhard said that marketing
is necessary “365 days a year”
in order to get the best price for
crops. He told the producers
that is important to write a
marketing plan and “post it
where you can see it every
day.”
The plan does not have to
have many pages with complex
charts and graphs. All it has to
do is spell out the amount of
com grown, in storage, cash
flow, and costs.
“Write it all down,” he said,
X?
til
SYMO-LIFE
RTILITY PROGRAM
More To Offer
Produce More Nutrients Per Acre!
• Produces a more nutritious feed stuff
with a better nutrient balance for
your livestock.
♦ Realize a greater net return on
your investment
♦ Program can be Integrated with your
present dry or liquid fertilizer
• Improved quantity yield/acre along with
improved nutrient yleld/acre.
Telephone (216) 893-2732
Toll Free 1-600-544-7122 (In Ohio)
Toll Free 1-800-368-6692 (Outside Ohio)
Fax (216) 893-3317
“It doesn’t have to be that tech
nical. But we need to think
about it evety day.”
Over the years, Newhard has
learned to “find out what the
com market is going to do, and
do the opposite,” he said.
There are many tools avail
able to provide information on
how the market is doing. Infor
mation sources include the
DTN satellite system, the Wall
Street Journal, and newsletters
including the Russell Report
and Pro Farmer.
The Lehigh club meets every
three weeks at a local restaurant
to review options avilable to
growers and to talk about the
market.' Newhard briefly
described some of the “insur
ance” options growers can
place on the grain crops grown.
The group is now in the
middle of learning more about
the market tools available
through a series of videotapes.
The series, “Ag Marketing and
Entrepreneurship, ’ ’ includes
IS tapes, each three hours long,
that review current marketing
strategies and tools.
“Follow the plan, that’s the
important thing to do,” said
Newhard. “When you hit the
©(DIM mi MlW®
target, pull the trigger.”
Membership in the Lehigh
Valley club is $lOO per year.
A similar club, the Central
Susquehanna Valley Grain
Marketing Club, began in the
Lewisburg area as a multicoun
try effort. Hie club, like the
Lehigh Valley club, is modeled
after the highly successful grain
marketing clubs in Maryland,
with similar goals. Cost for
membership is $125 per year.
Bill Robinson, president of
Cramer Feeds in Cramer, pro
cesses 100 tons of feed per
week, including 20,000 bushels
of com per week for poultry
operations. He also has a family
farm, on which he works full
time.
Robinson reviewd what is
“old” and what is “new” in
terms of marketing.
Old concerns for growers
include the fears of price risk,
worries of storage com prices,
and about the weather. New in
marketing is the fact there is a
phenominal demand for pro
duct. “It’s a seller’s market,”
he said.
Cramer purchases more than
one million bushels of com per
year for poultry operations.
Robinson said that growers
should become more active in
grain marketing clubs and learn
to manage the risk of the
marketplace.
Of the current high prices of
com, ranging from $3.50-$3.70
a bushel, Robinson said, “I
think the farmers deserve
them.” This provides farmers
with the opportunity to ‘‘get
y-®\ WARNING, ALL SILO OWNERS
/fwARNiNcX Check your silo now for rotten staves. If you
(/ concSSetroh/ have been using your silo for 10 to 15 years
V corn nnmjl for either com silage or haylage, It Is time
to SHOTCRETE.
jR* ~jß
Coats the interior \ i ‘ t
Protects m storage | j
• Durable
# Increases useful life
4H|^^|
REPAIRS HOLES:
* Repairs even large holes
• Up to twice (he strength of the
original slave
• Rapid application
• Durable surface
EXTENDS USEFUL LIFE:
• Support for old foundations
• Special repairs can be made
quickly and economically
• Little or no forming needed
* Stronger than the original
Shotcrete la also good for repairing atone walla
When you think your silo Is beyond repair
THINK OP SHOTCRETE!
Lancaster Silo Co., Inc.
2008 Horsaahoa fld. • Lancaster, PA • (717) 299-3721
PENNSYLVANIA MASTER CORN GROWERS ASSOC., INC.
back on their feet and guarantee
some longevity in agriculture. ’ ’
For the grower, knowing
how to manage risk comes
down to “knowing what the
costs are and taking advantage
of the maiket,” which is diffi
cult. But there are many tools
available for the grower,
including insurance such as
puts and calls that reduce the
risks.
That type of insurance is
necessary for cash grain grow
ers and should be part of the
operating budget, according to
Robinson. If a producer decides
not to maiket, “that is still a
cost,” he said, which could
show up in lost profits.
Robinson reviewed some of
the options available and
explained how useful they can
be.
Staying in touch with the
mill and looking at various
reports available from the Chi
cago Board of Trade can help.
For more information on the
clubs, contact Tom Murphy at
the Lycoming County
Cooperative Extension, (717)
327-2350.
Before The site s interior After The surface is
with plaster damaged and slave reconditioned and a new thick
exposed
- ■
- **
Before A hole is worn After With the hole repaired
completely throufh the silo wall by Shot Crete and a new
surface applied the silo is
ready for years of use
'W,-* i,
Before The bottom part of After The ShotCrctt
the staves arc completely worn System repairs and replaces
away the missing structure
tough surface will protect
stored feed