I was wrong about the bull run that made grain prices soar beginning in 2008. Will I get it right on the 2020s’ surge? More to the point, will you?
Of course there’s that old saying that we’ve all heard too many times. The worst decisions get made in the best of times, it says. Or, as it’s sometimes recast, most bad decisions get made in good times.
But that isn’t actually what I had on my mind when the long, drawn-out 1990s finally came to an end just over a decade ago. I didn’t think farmers would suddenly lose their senses and get massively overextended in a wave of unsustainable optimism.
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Instead, what I expected was that we’d see a huge increase in the amount of variation between our farms. Farms that had the ambition, the insights and the skills to make shrewd use of their higher returns and would set themselves up for future wins. Those that didn’t would do well, but growth would be slow.
And some of this did happen. But what happened a lot more often — and what I didn’t foresee — was that farms across the country would all transform their performance as business managers.
In hardly any time, we went from an industry where bankers were always complaining that farmers weren’t up to doing their business due diligence to an industry where farmers complain that their bankers can’t keep up.
I exaggerate, but not that much.
Of course, too, the fact that farming is a business that stores its profits in the price of land means that all boats did get floated by the rising market.
And, obviously, both those things are very true and very much in evidence today.
What’s different today, though, is there are so many more options available to farmers who are both so much more sophisticated and, by and large, so much better resourced.
In times gone by, business planning often seemed to swing between seeding fencerow to fencerow because prices were so poor you needed every bushel, or seeding fencerow to fencerow because prices were finally good and you couldn’t afford not to go after them.
The difference today is vision. It’s the thing that used to get laughed at at farm business workshops. (Remember the old joke — My vision is to keep farming until the money is gone).
Goals that were inconceivable a decade ago are now realistic. Not everything is achievable, of course. You can’t buy half the province, but if you want to expand, and that’s your goal, it’s actionable. So is growth by diversification, or getting into vertical integration, or forming new partnerships, or managing the farm so the family wins whether you drive the tractor or not.
The old cherry that said there is no point in thinking about your vision as a farm because every farm has the same vision — to survive, and grow when possible — is no longer valid.
It’s part of what I’m hearing from farmers responding to my request to let us know how Guide needs to evolve. They have decided where they’re going. They can articulate it, and they’re confident in it. From my vantage point, that looks like a very big deal indeed.
Are we getting it right? Let me know at [email protected].
