Plain Dirt Financing Financial Information for Amish Farmers Autumn 2021
Thinking Outside of the Barn Ryan Shultz, Farm Credit loan officer
Over the past few years, it has become apparent that small farms will
need to innovate in order to keep up with the ever-changing market. Global trade and modernization have continued to put downward
pressure on commodity prices, inadvertently favoring larger producers that can take advantage of such economies of scale.
For example: A 2,500 cow dairy will have a much lower “break even” mailbox price than a 40 cow dairy; simply because their cost per cow to operate is lower. As commodity prices continue this trend of downward pressure, small and beginning farmers will need to get more innovative in their
marketing strategy. This is where thinking outside of the box (or barn) really comes into play. Here are three ways you can think outside of the barn to get ahead of the market:
1. Do market research to find your niche This is one of the most important considerations a farmer can make in
this day and age. And no, I don’t mean sophisticated research that only an economist can understand. I’m referring to the marketability of your commodity or crop. For a produce farmer, this may mean considering options such as: •
Selling produce at auction (If so, which auction? Factoring
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Solidifying a contract
• • • • •
transportation, prices at each auction, etc.)
Selling to a more niche market that may pay a premium for quality product
Selling at a farmers market Road-side stand
Transitioning to organic
Growing more or less field produce vs. greenhouse produce
All of the above are ways you can think outside the box and dig into
how you can differentiate yourself from other (similar) operations in your area. While these may be options you have already considered, it’s worthwhile to reevaluate these possibilities at least once a year. (Continued on next page)
Autumn 2021
