South East , Manitoba , Canada | I get accused of being too negative about profitability in the Ag business. But I think I am just using real numbers. There are many ways to present the accounting of any business. You can make it show a profit or loss by moving things from one cost center to another (selling corn to yourself for cost of production... not market value). It never seems that the real numbers are used.
Once you are involved in the business it is really hard to get yourself out of the business. Any of the food production businesses take a huge investment to get started... not something that you can just jump in and out of. Heck aside from the money you have to have skill... real talent to manage all the animals / machinery / business things that need to be taken care of to have a good operation.
The world population increasing and future food shortages seem unreal... I think there is no shortage of food... just a shortage of people who are willing to pay the real cost of production
There are a lot of good producers that have left the beef, dairy , pork ... and in general farming... because there is no profit to be had.
I know how to produce beef and enjoy doing that ... but I can't afford to pay to have somebody eat what I grow.The current high prices for beef are in my book just getting to the cost of production... Cow / calf operators have been under paid for so long the rest of the industry thought that was the normal. There is still a need for the cow herd in Canada and the USA to shrink to allow a fair price to be paid to the primary producer.
Will the current spike in gas prices come out of the cow/ calf / dairy / pork or any other Ag producers pocket??? Lets hope not! |
Dairy Industry
