As the 2018 season ends, growers, agronomists, and financial advisors start to analyze this year’s results in order to prepare budgets and plans for next season. Determining how much product will be needed next year is a crucial determination for farm operations, especially if you’re intending to use prepayments to cut costs and create tax savings before December 31.
By all industry indicators –weather conditions, compressed margins due to higher input costs, and low commodity prices – it’s more important than ever to step up the level of precision in your farming.
“There is literally no room for error in today’s commodity market,” says Alan Grafton, principal with K·Coe Isom’s AgKnowledge team. “In the last year, many farmers have had the opportunity to market profitably, but some did not pull the trigger because they were uncertain about their true cost of production. We know that if we create a plan and a budget with an exact cost of production analysis, growers stand a better chance to market effectively, control costs, and weather this downturn in the commodity cycle.”
With the increased focus on the cost-side of a farming operation, honing in on areas to keep costs down becomes critical for commodity fields. Accurate forecasts and budgets, and the use of field planning tools for precise data, will help with determinations.
“Farmers will have to use every tool available to them in the next few years,” adds Grafton.
For more, read the full published article in PrecisionAg.
K·Coe Isom helps commodity producers connect sound financial decisions with field management. Contact our AgKnowledge experts for more information.