Being Competitive in the Ag Sector - From the Ground Up

“It’s taking four to five times as many dollars for me to do business as I did thirty years ago when I started, and anyway what that means is you better have a little bit bigger basket when you’re doing business.”

Jason Wendler farms and ranches in the Brazos Valley.

“Not that I’m any bigger than I was thirty years ago, I’m just talking about for one animal unit, one acre unit is what I’m speaking of, but the complexity is having to handle more money to operate the same on acre the same cow.”

Robert Jensen runs a stocker/feeder calf operation.

“We have to use futures markets and forward pricing and forward contracts all the time just to try and build in some stability, and a lot of people don’t do that, are nervous about doing it, don’t understand it, and it’s hard on the people that don’t use it, and it’s hard on us that do use it because even there there’s a lot of volatility in those prices. Stability would help us.”

It takes capital to play the futures game.

“Today as we’re speaking we’re looking at above six dollar a bushel corn. We’ll when I hedged up at five dollars, and will I make money? If I can make a crop I will make money with my five dollar corn, but I have to ante my margin calls up between now and harvest.”

And to remain competitive producers must understand and be able to afford technology.

“A cow does not understand technology, but you have to in order to stay in business with her. A corn plant doesn’t understand technology. It can pay you dividends back with its technology.”

Today’s agricultural producers have to wear a variety of hats to insure their operations will remain viable in today’s environment. I’m Ashley Batey, looking at Brazos Valley agriculture, From The Ground Up.

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