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Farm Finance: 6 Ways to Make Every Field Profitable

Posted by Scott Anderson on May 21, 2015 8:07:00 AM

farm finance farming tips


"Not all dirt is created equal." (Click to Tweet)

Unfortunately, you can’t produce whatever you want and expect to make money. You have to let the field tell you what it can produce.

Fields even a few miles apart will produce different amounts of rain; soil can change dramatically 100 feet away.

Yes, some fields are sagging your profits. But don’t worry: you can make any field profitable if you handle it right.


Here are six farm finance tips to maximize your profits and ensure that every field is profitable:

1) Determine which crops the ground is good for.

Recently, I posted an article about how to build a grain marketing plan. In it, I talked about how looking at your inventory, in every field, is key for knowing when to sell your grain.

Cash Cow Farmer is really good for this. It determines production costs on a per-field basis, and our software will help you decide which crops are profitable at the current commodity price.

Not all fields can grow 180-bushel corn. And a 120-bushel likely won’t cover your production costs. It sounds obvious, but it’s a bad idea to produce corn on a low-productivity, high-production costs field, especially at the current market.

One more thing to think about: is cropping the best route to go with the field? If it has good water, it can be pastured or put in a government conservation program for wildlife.


2) What logistics help or hurt the ground?

It’s not always about productive or unproductive fields: sometimes it’s how you operate.

How far do you drive your machinery from your primary operation? How far do you haul grain to get to the buyer?

If you’ve got a long haul, a high volume crop like corn may not the best. Maybe soybeans or wheat would work better---something lower volume.

As for the field, is it square? Odd-shaped with lots of wet spots? Fields with hills or wet spots may be better for pasturing or a wetland conservation program than cropping.


3) Cover Crop Rotation

Cover crops can make unproductive ground productive.

They do that based on their assistance with soil moisture and weed pressure.

Cover crops can actually decrease your production costs based on how they work with the soil. This is one of those situations where spending a little more will save you a lot more.


farm finance farming tips


4) CSP or Equip Farm Programs

For uncooperative fields, you’ll probably want whatever income you can get from government programs. You’re trying to cover costs, so why not lean on programs made to help you?

CSP and Equip are two standard government cropping programs. I highly suggest looking into them and maximizing revenue for your fields.


5) Insure to protect losses

Insurance isn’t a very common farm finance tip, but here’s why we mention it.

Insured, you protect your losses. You also make sure your APH (proven yield) is above the cost of production. If your proven yield times the current commodity price is lower than the cost of production, you should consider growing a different crop.

The main thing is to make sure your revenue guarantee on your insurance program will cover your production costs.

If it will, you’re guaranteed not to lose money.


6) When in doubt, rent it out

The landlord almost always makes more than the tenant.

Focus on what makes money; if a field doesn’t make you money, rent it out. If the field fits better into someone else’s operation, see if they would be interesting in renting. Even if it’s only certain pieces of the ground.

Everybody has their rock star fields. Stick with those---and rent the rest.



Before you sell all your equipment and vow never to look down at the dirt ever again, try each of the farm finance tips above.

Sometimes a field is better suited for pasturing than cropping. Sometimes a cover crop will take back what the weeds have stolen. And even if a piece of ground seems hopeless for you, you can rent it out.

Every field can be profitable. NO field is profitable in exactly the same way. (Click to Tweet)


Profitability is our area of expertise. Try out a free 30-day trial of Cash Cow Farmer today to project production costs, manage your present and future inventory, and more!


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