Chaotic Times

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Partners & Friends,

With all of the world events swirling around us, we just wanted to share some of the thoughts and challenges we are facing. The commodity market is more volatile than ever in history. I have never seen soybean price swings of $1.30 in a day and corn limit up two days in a row. We are currently 60% sold for the 2022 crop and 20% sold for the 2023 crop. The energy situation is a huge unknown. Will the free world be strong enough to quit buying oil and commodities from Russia? How high will oil go? This country can be energy self-sufficient, but it will take some reallocations of products and transportation issues. Do we need to be "green" by a certain date, or can we let market forces adjust the supply and demand? The farm is currently contracted for 75% of the fuel we expect to use this year. Fertilizer prices are almost 3 times higher than a year ago. We have not been able to successfully contract our side dress NH3 needed for this spring. It seems to be a supply issue, but the price is making us wonder about the profitability ratio between corn and soybeans. We were fortunate to contract the dry fertilizer needs for last fall early enough to avoid the last chunk of the price jump, but now, for this fall, we are looking at prices that make applications look too expensive. Financing in this world of tumultuous markets moves and record-breaking inflation has led us to look for some methods to help lock in as much inventory and inputs as possible. Supply issues and manufacturing problems in chemical production have caused changes in our products used for crop protection. We luckily made our last major equipment upgrades before availability issues arose in 2022. The wait time for new equipment is now around 12 months on most large tractors, planters, sprayers, and harvest equipment.


So much to manage around here—that's why we love our jobs!


We are busy delivering grain—over 70,000 bushels in March. The completion of the planter rebuild is within sight. Last minute office tasks and some building remodeling are occupying the work days. There are still winter meetings to attend and financing details to deal with.


World events are overshadowing the decisions we are making about crop insurance and farm program choices (ARC or PLC); the primary election candidates seem so trite. We pray for our fellow farmers in Ukraine daily. Whether or not they are able to plant this spring will make a huge difference in global grain supplies. They account for 30% of both wheat and corn exports worldwide.


Families are doing well—trying to get some time off before things get busy. Weather is nice in Florida. Schoolwork is consuming a lot of bandwidth. Goat showing season starts soon.


Current cash prices (pay attention—these are near record highs!):

Corn—7.34

Soybeans—16.97

Here is a plea from a Ukrainian farmer, please have a read.


Keep in touch,

Steve