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Roseau, MN | To start out I am a young farmer (30yrs), I have no family involved other than me. I have been farming on my own for about 6 years and have been able to make a full time living doing it. Slowly I have built a pretty decent ballance sheet. I believe I am a hard worker and smart with my money, but here is what is going on. My operating loan is through the fsa office, so I have to pay it back in full in order to recieve a loan for next year. The other stipulation for an operating loan is that I must show a positive cash flow for the operating year. I could show a small positive cash flow this year on an average aph. I also contracted a portion of my crop before this last nice run up in prices, bummer for me. If I forward contract most of my aph for next year I can easily show a positive cash flow to get an 2011 loan. Here's my dilema.... due to an excessivly large amount of rain in the month of june I have about 25% or 500 of my acres that got almost completely wiped out. This was new land to me for this year and I new it wasn't as productive as my other ground. But who would have known that the weather was going to play havoc with the crop that much. Rent and crop rotations dictated that on an average year money would be made on the ground. I rented the ground and then in June, days after planting, recieved over 16 inches of rain there. My crops around the home place are average or above average, but they will not cover the losses for the rain damaged crops. I will not know how close I will be to paying my debts off this year untill the beans are all harvested. So... if I am short do I sell equipment and free up assets to cover my debts in order to get a 2011 operating loan? Thus, I will have to rebuy some of that equipment next season when needed. Or try to refinance through the fsa office? I am at the point in my career that a couple of average years could sure help me out and help me earn a cash cusion, but I'm not getting that lucky on my crop as a whole. Oh, and some of the ground I will get an insurance payment, but the rest with be offset by enterprise units so not much of a payment will exist. I am assuming in everyones careers this kind of a year shows up, how do you deal with it and go on?? Sometimes I wonder why in the world I try to make this work.... So much hard work and risk to have a bad month take it away. P.S. In order to sleep at night I have told myself I can't dwell on it untill the rest of the beans are harvested and I know what I am for sure dealing with. | |
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Young Farmer Dillema.... looking for advice?
