Chapter 2: Getting Started

Chapter 2: Getting Started, Or Look Before You Leap

Chapter 1: Look Back

Professor of Biology in the Department of Horticulture and Forestry at Cook College, Rutgers University

How to Avoid Gambler’s Ruin
Bank = House
Farmer = Gambler

2 Ways for an American Farmer to Escape Gambler’s Ruin
Leave the game or stop farming
Diversify - improve marketing, lower costs

Farm Like the Amish - consider the farm labor of the entire family an asset that brings the household and community together

Your Farm is Worth More than Ever - Robert Rodale

Internal resources can lengthen the life of your farm and make you more money

Agriculture has been practiced for 10,000 years
For 9,900 years farmers functioned ENTIRELY on their internal resources

Internal Resources: Land, Sun, Air, Rainfall, Animals, People

Historically farms were self-sufficient systems of production

Land - Within the silt were large stores of minerals. Which are not readily available to plants. They become available little bit by little bit.

Air - Source of abundant carbon dioxide which plants rely upon. 78% of the air is nitrogen.
Like the minerals in the silt; the nitrogen in the air is locked up. Certain plants can capture the nitrogen out of the air (ex. Legumes - are a good habitat for root zone bacteria to collect nitrogen from the air and provide it to the plants

Sun - The sun is the primary source of energy for all of us. Historically the farm itself would collect this energy which would allow for the production of food that humans would then use for energy.

Rain - The moisture in the air also is a very important internal resource for without it nothing thrives.
Plants, Animals and People and their knowledge of how to work the land all were invaluable resources to the farm.

This is how things worked for the first 10,000+ years of agriculture.

100+ years ago things changed.

We moved from internal resources to external inputs like: Fertilizer, pesticides and fossil fuels

The reason for this change was due to the population growth. There was growing concern 200+ years ago that the existing farming system wouldn’t be able to feed everyone.

Jethro Tull - inventor of row cropping and thorough tillage and weeding warned that if people didn’t start farming like him, they would starve or start eating each other.
He went to law school at oxford university and was accepted to the bar, but never practiced law. He traveled Europe and observed agricultural practices and invented things instead.

German chemist - Justus von Leibig formulated the law of the minimum which states that the crop yield is limited by the level of the major nutrients that exist in the least amount. Led to the creation of the modern fertilizer industry

Farming - A Matter of Dollars and Sense
Article by Judy Yaeger

Simple Approach to Farm Economics:

Determine Annual Sales (gross)
Subtract What Was Sold

Used this difference to determine if they had enough money to live on (net)

If this net number was (high) = vacation
If the net was (low) = tighten belts
If it was negative = off farm jobs

Judy farmed 90 acres near Lawton Michigan with her husband John. 15 acres of vegetables, 40 acres in pasture and 50 ewes

Know Your Cash Flow in Advance