Solutions for Success 2.0: Beyond cost cutting

We are a few years into the transition from unusually strong prices and profits to levels more consistent with the pre-boom years. Many producers have made a variety of changes to reduce costs and boost income to position their operations for the future.

For instance, USDA reports production expenditures last year were 9 percent below 2014’s peak and the lowest since 2012. This was due mainly to an average 5 percent reduction in land rent, the single largest expense, and an 11 percent reduction in equipment-related expenditures. Lower fertilizer prices also helped.

However, it’s not all about cost cutting. As part of our GrowingOn® 2016 series, we highlighted adjustments that can free up working capital. Steven Johnson, Farm and Agriculture Business Management Specialist from Iowa State University, also urged attendees to capitalize on seasonal price strength. Those who took the opportunity the markets offered in June and July are 50 cents or more better off than what the market is offering just ahead of harvest – and much better off than USDA’s September marketing year average price projections — $3.05 for corn, $9.05 for soybeans and $3.62 for wheat.

At this year’s free GrowingOn meetings, Johnson will offer his outlook for 2017. Several case studies will illustrate the opportunities producers have to improve their operation’s financial condition, including how Revenue Insurance can help protect balance sheets and support marketing plans.

Join us at a GrowingOn 2017 meeting. Online registration will be available at growingon.com/kansas by November 1, 2016. Contact your local office for more information.

Tap into our financial and insurance expertise as you position your operation for this cycle and create opportunities going forward.