All indications as we head into 2014 show that farmers won't have the record high prices they've been experiencing in recent years.
David Lynn, senior vice-president of financial services for Farm Credit Mid-America says that will change how farmers plan for the coming years.
"Many producers have essentially not have a marketing plan," he says. "They've done very well absent a marketing plan. However, going forward, that won't be the case."
He tells Brownfield there are a few things farmers need to consider in the future.
"Number one, it's not just the cost or the prices of the commodity they're seeking to sell," he says. "But what their breakeven point is. Their cost of production and certainly yields are going to influence that."
Lynn says the change in commodity prices means farmers need to take a closer look at their operations.
"Set goals for their operation and take advantage of those management tools that might assist them," he says. "Those things that can help them improve and help them have a profitable year."
Coming off of several good years of production and strong prices he says many producers have a strong financial position. Lynn says he suggests not using all their cash on hand to pay down fixed rate loans and instead use it to maintain a strong liquid position.
Source: brownfieldagnews.com