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HAT TIPS

Posted 1/05/16 (Tue)

Hello,

Man, am I ever glad that we are through the holidays. Between Christmas, New Year’s, weddings, poker and pinochle games, cow sales, and ranching, I am worn out. It’s like one of those ads where your mind says yes, but your body says no. “NO MAS! NO MAS!”
One night we went to a wonderful supper at a friend’s house. It was with some people Shirley and I had served in the Legislature with. It has become an annual affair where we have a glass of fine wine (which I couldn’t tell from a bottle of poor wine), have an elegant supper, and talk of politics. Past, present, and future.
Part of the discussion was on the current commodity prices. Livestock prices have rebounded somewhat off their sudden drop the past few months, but still much below a year ago. Grain prices have people struggling to find a profitable scenario for the next year. Oil prices have tanked which is affecting the state and personal budgets for many in our area.
Part of our discussion was how we have a younger generation of farmers/ranchers who have enjoyed several years of relatively good prices. They haven’t had to sit in front of their banker with their hat in their hands and explain that they need financing to put in their crop, pay their rent, and make their land payment. And they can’t pay off their operating debt from last year. Trust me, it happens.
Which got us to a true story.
One of the guests at supper told when he worked for a livestock shipping association. And livestock prices were terrible.
One of their members shipped a load of sheep to South St. Paul. Which for years was a terminal destination for slaughter livestock.
Woe and behold. The proceeds from the sheep sale didn’t cover the shipping cost. After the shipping cost was deducted from the proceeds, the rancher owed the terminal more money.
To remedy the situation and to make their books balance, they sent the rancher a bill. He wrote them back that he didn’t have any money, but “I could send you another load of sheep!”
They didn’t reply.
And then there is the story of the farmer who planted wheat every year. Wheat prices plummeted. Drought prevailed. Hail storms abounded. Everything that could go wrong did go wrong.
His banker, along with his county agent urged him to diversify. Plant watermelons they said. Plant watermelons.
So he did. And he raised a wonderful crop. He set up a stand out by the highway and word got out about his wonderful, sweet melons. He sold out! And made a killing!
He went back in to his banker.
Here is the payment for my operating loan. For this year and last year. Here is the payment for my land. Here is the payment for my son’s college tuition.
“And,” he said, “The good news is I saved enough money to buy my wheat seed for next year!”
Later,
Dean