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The 1980s versus now

Mark Andrew Junkin for Progressive Dairy Published on 11 September 2019

Recently I worked with a family in Wisconsin who had a cost of production of $19 per hundredweight (cwt), and they were getting paid a lot less than that.

They were losing money. We sat down with their dairy nutritionist and veterinarian for a brainstorming session, and the family was able to identify seven easy-to-execute changes that would lead to $500,000 in improved efficiencies. For instance, the farm calculated that they were losing $450-plus a bull calf, but if they were to sell the animal at only 5 days old, they’d net an average of $100 a calf. However, the patriarch dismissed each suggestion for change over the three weeks following. Why? He didn’t want to admit that there was anywhere within his operation where a nickel could be squeezed. His pride was prioritized over restructuring the farm and having a farm to be proud of within five years.

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When you get up to feed cattle every day of your life, it’s impossible to imagine that barn being empty, let alone someone else owning your farm. That’s just as silly as saying there won’t be a sun rising tomorrow morning. When being a farmer is everything you are, not being a farmer is like telling your dog he is suddenly going to be a kangaroo. It seems impossible.

However, just because you were successful five years ago, doesn’t mean you’ll be successful five years from now.

In the ’70s, my Uncle Gerald was known far and wide as one of the best farmers in the county. He had five men working for him, and they say he did the work of five men himself. He was a go-go kind of person who got up at 5 a.m. and worked until 10 p.m. everyday without ever stopping for lunch. They say that if you could keep up with Gerald for half a day, you were a man.

As the ’80s approached and the infamous farm crisis took solid root, my Uncle Gerald continued to farm as if it was 1976. In the early ’80s, Gerald thought a lot of himself and was starting to make decisions based on pride. On his death bed, my Grandpa, Gerald’s dad, warned him about his high debt load, but Gerald always had a good comeback. Whenever anyone questioned his decisions, he’d just quote his favorite cartoon: “Don’t worry, I’m smarter than the average bear.” Gerald was a genius, but his overconfidence made him make some very foolish decisions. Gerald had been through tough times before, and the early ’80s farm economy didn’t faze him. Gerald was convinced that the cattle prices would rise, and the interest rates would level out. Gerald didn’t see the need to change what he was doing. He just thought the world around him would change. And it did – the economic conditions did eventually improve – but not in time to save Gerald’s farm or Gerald.

Now if we were to compare the ’80s farm crisis to our situation today, there are certainly some big differences. But there is one thing that we often don’t think about or even realize. Back in the ’80s, most farms were sole proprietor operations. If a farmer got bad news from the bank, he could go plough for a week and not talk to anyone – just plough and think through his problems. Then he could drive into town, see several people and make several decisions, turning things around in an afternoon. (This didn’t happen with Gerald, but many farmers did that and that is probably why your farm exists today.) But what do we have now? We have two, three, four or more shareholders in a farming corporation. And this, more often than not, produces a situation where there is not just one decision-maker, but two, three, four or more, and everyone is fighting for control of the final word. On most farms today, miscommunication and egos affect the farm’s bottom line more than the markets and weather all together. Partners these days struggle to make basic production decisions together, let alone make complex strategic decisions together.

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Decision-making on the modern family farm is 10 times harder than it was in the ’80s. As a result, most farms haven’t dropped their cost of production by 5% in the last three years due to family dysfunction, let alone the 25% or so that is required to survive at today’s low prices.

My first memory of my Uncle Gerald was in 1983 when I got a sunstroke at age 8 at his auction. I remember Gerald scrambling to sell everything that moved that day in order to cover bank payments. It was a hot, dry day – a perfect haying day. Gerald should have been haying himself, but instead he was selling his baler. My mother spoke sourly of her brother, saying, “He did too little, too late.”

Gerald didn’t feel threatened until it was too late. Then he wasn’t holding enough cards in his hand to be able to play the game.

How soon is your family going to react, and will you have enough cards in your hand to make the adjustments you need to survive? When are you going to get serious about having that conversation with your family? Not just complain about the situation or shift blame for problems, but seriously sit down and problem-solve together as a family?

We talk about risk in farming, but I think very few understand what that means. Gerald didn’t just lose the farm. He lost his wife (divorce) and contact with his kids. His brothers and the whole community disowned him. But that is not the worst of it. Gerald had worked crazy hours without proper nutrition, and shortly after his auction, he was diagnosed with severe diabetes. After he lost his farm in ’84, he all but disappeared. We heard he was splitting firewood for the tourists, but we lost touch with him. We did not know his health was so bad that he couldn’t work anymore, and he eventually became homeless. In 1996, after the spring thaw, the police found a body, and only the dental records could prove it was my Uncle Gerald. But the hard, hard truth is he didn’t die of the elements; he died because his pride killed him.

Why am I telling you this story? It’s not out of disrespect for my Uncle Gerald; he is why I do what I do today. It’s because something good has got to come out of this tragic event. It’s out of respect to your family and to challenge you to really take the current agricultural winter we are in seriously.

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I can’t go back in time to shake my Uncle Gerald, but I hope to be able to shake you, inspire you and motivate you to stop sitting on your hands and to start discussing with your families realistic solutions on how to drive your cost of production below the lowest you foresee milk prices going. Don’t make decisions based on pride; make decisions that will give you a farm to be proud of in a decade. Take these milk prices seriously! Make decisions while you have cards left in your hand, not after it’s too late.  end mark

Junkin is the author of the groundbreaking book Tough Times Never Last, Tough Farm Families Do and has free communication resources for dairy families at Agriculture Strategy.

Mark Andrew Junkin
  • Mark Andrew Junkin

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