A series of risk management workshops in December and January will address ways to manage risk during a downturn in the farm economic climate. The Indiana Soybean Alliance and Indiana Corn Growers Association host the first workshop Monday, December 7 at the Beck Agricultural Center in West Lafayette along with economists from the Purdue Center for Commercial Agriculture. One of those 3, Dr. Michael Langemeier says it’s important to look at long term decisions through a wider lens than the just upcoming growing season.
“People who have been in farming quite a while know this, but maybe somebody that started fairly recently does not. Things will get better,” he told HAT, “so you have to figure out what do I need to do here in the next 1-5 years in order to survive this downturn. One of the key things is attending workshops like this where we talk about long run decisions and strategic risk so you can really start thinking more long term rather than just this next crop year.”
The workshop will cover trends in cash rents, land values and crop net returns, in addition to financial risk. But the main focus of the day will be strategic risk.
“That’s sometimes hard to get your hands on, but really what strategic risk is thinking long term,” Langemeier said. “Given where we’re at in the downturn are there some opportunities for farms to perhaps pick up leased ground? Maybe someone else is not in the position to rent the ground. Maybe it’s an option for you to pick up some more ground because sometimes when you have downturns like this it’s an opportunity to expand. Of course you’ve got to be very careful when you this because you’re going to increase financial risk by using your capital to lease additional ground or buy additional assets.”
Langemeier says there will be a particular emphasis on focusing cash rent decisions over the next 5 years.
The December 7 workshop from 11:30 a.m. to 3:30 p.m. is free and lunch is provided by Beck’s Hybrids. Pre-registration is required at www.indianasoybean.com/forum. Get there early for a policy discussion hosted by the soybean and corn organizations at 10 a.m. followed by a town hall meeting with Senator Joe Donnelly at 10:30 a.m.
Workshops in January will be in Shelbyville at Indiana Grand on the 11th, and at the Fort Wayne Farm Show on the 14th.
Joining Langemeier conducting the workshops by the Purdue Center for Commercial Agriculture are Dr. Jim Mintert and Dr. Mike Boehlje. The interactive session will provide resources, including a spreadsheet tool farmers can use to better manage their financial risk, particularly cash rent risk.
Workshop participants will also learn more about Farm Risk Resources, a new website made possible through the Indiana soybean checkoff. The website, www.farmriskresources.com, features case studies, videos and tools designed to take users through a progression of the fundamental types of risk, theories and strategies needed to successfully manage their operations.
Other presenting partners of the risk-management workshops include Indiana Soybean Alliance (checkoff), Indiana Corn Marketing Council, Indiana Farm Bureau, Indiana State Department of Agriculture, U.S. Department of Agriculture Farm Service Agency (FSA) of Indiana and Purdue Extension.