Farmers Get United.

[Steve]

I know that I must sound like a broken record on this subject but will continue and clarify some of the points on how the farmers association should function, and by comparing it to co-ops and unions may be the easiest way.

The farmers association doesn’t discriminate against co-ops or united organizations and all primary producers are welcome to join even if they are active in co-ops, but can’t and will not be tolerated if they bring in problems that arise in others parts of the food chain. I am talking from experience and know that to many cooks will spoil the soup.

Co-ops worked reasonably well in small areas and served the local people needs before globalization took over. Co-operative organizations are setup to control the food chain from primary producer to in user, and to accomplish this idea on a large scale is impossible because the food chain is long,complex and also global.

Local co-ops are okay because that gives the associated farmer one more choice to sell products and as I said before there is room for farmers to go their own way and sell eggs, veggies and home made bread direct to the consumer, but that is not the choice of the majority.

ValueChainFX : you are correct by saying that you need good communications along the food chain and it is already there by way of competition.
Good managers along the food chain know it is imperative to provide satisfactory service, quality and the right product to the consumer in order to stay in business.
I think you said, it is hard to get a consistent quality product to process so this is also passed on to the next phase of the food chain.
Now by this example you can see that a co-operative food chain would have a problem to maintain that needed quality, because your inline partners can say, “ we did the best we could ” are you going to be satisfied with that solution?

So we can say if you want a sustainable business, produce, process, and deliver the product that the customer wants and competition will give us all a choice.

Now my reason to propose the farmers association is to even up the risk and the rapid increase in production cost. At the present time the primary producer is not able to pass some of this addition cost and risk onto the food chain.

The farmers association only deals with the primary selling price of products, which will be set at a fair value, as not to destroy the incentive for good management and maintain a sustainable business. At the same time it will be the responsibility of the producer to produce the product that can be sold.

The association has no monetary value therefore it can’t go broke and is based on trust.
Ianben had the right answer for this one “ if we can trust a piece of paper for our money, following mutual beneficial advice should be easy.

[Steve]

Ianben, thanks for pointing out the reasons why farm expert advisers should not be any part of the farmers association. Some additional reasons are: Most of them are Government employees or have their own practice, are not primary producers, and it would not be in their best interest to promote such an organization.

I think they do and should continue researching new ideas in farming practices, seeds and chemicals available, also good management.

On the marketing side, do research on world demand, product surplus and commodity prices. They can make their predictions as to the products to produce and the possible price to expect. The farmers will have to decide if to use it ( its like the dog scenario will he ever catch his tail ) or stay with a good crop rotation, but do try some new products.

[Steve]

Proposed farmer’s association guidelines for establishing primary producers grain prices are:

Five years of production per defined area with the extremes high or low not include.

Areas with constantly very high production only 80% value will be used.

Areas with extremely difficult problems to produce an average crop 30% value will be used.

By using all three values it should give us a reasonably good production average for each crop. (open discussions at the meetings on this topic )

We can’t incorporate loss of grain production into the average due to extreme weather conditions and crop insurance will have to take care of that problem. This association will not deal with weather related problems and should be discussed under risk management, although the right grain price will also help.

The cost of production:

Land value will not be used, but the average rent per acre in each area and the very highs and lows will not be used.

Average size good equipment and the right ratio to cultivated acres will be used to determine the cost of equipment. Fuel and labor costs will be added.

There are a lot of studies that can be used for the amount of fertilizer to be applied to produce a good crop and herbicides to control weeds. ( GMO products will be considered )

Cost of crop insurance will be added.

At the meetings there will be discussions to determine the net profit needed to replace equipment and maintain a sustainable farming business.

The grain prices will be established after considering all the above. ( and things I forgot.)

The individual producer will have to decide on their lifestyle and how much land it will take to operate a sustainable grain farming business. I know there will be problems in some areas and will have to be solved by good management decisions.

This is not a prefect solution for all farm problems, but by starting with a fair selling price for products to help the primary producer is going in the right direction.

Wrong or right but solving one problem at a time is the way I see it.

[ianben]

Steve. The banking thread above highlights the problem we are facing I feel.
The farmers unable to see high risk business,farming,will pay high charges on loans.
Prudent business for a bank after all who knows what the produce will be worth

Rock bottom. Planting without fert and chem for insurance.
Desparate.
No farmersanonomous.com

All because we can't fix a price!!!!!