The Permafrost Is Melting

I saw on the news a report that said the permafrost is melting.  I don't know how many of you have seen it but is just what I would call permanent frost in the ground in the coldest areas.  It makes sense to me that would move around and change over time.  It got warm enough to make glaciers cover North America around 10,000 years ago, you know?

It did that again 100,000 years ago and both glacial soils hold up our house.  They do a great job of producing and holding up our crops, too!  The foundation sits on old cut bedrock but I have no idea what era that stone is from.   I do love these Wisconsin aged soils but they are quite erodible where I live.

Yet, this morning, my friend Eddie says it's minus 52 degrees in Chicken, Alaska.  Frozen Chicken, get it?  So who is telling the truth?

I assume both things are happening at the same time, so I wouldn't sweat it too much.  If we look closely at ourselves I do believe we have "bigger fish to fry."

It's the last day of the 11th month.  Where did that go?  Tomorrow is the first of December and Advent is upon us!

LuAnn is preparing the house for Advent.  We have no tree up yet and won't until Steve comes back and replaces the rotten timbers near the front door.  That part of the front room is where the tree is going to sit this year if we get it done in time.  If not, we will celebrate some other way!

All of her Chinese special artificial trees have bit the dust so I have been bargaining for a cut tree or a live tree.  Either one is a mess but we can plant a balled tree on the new farm.  I think that may happen though we have not shopped for one yet.

What do you think of this piece I just received?

If you live in the states, I would also encourage you to complete this survey for my friend, Mike Huckabee.  I already completed it so let me know if this link doesn't work for you, I can't tell from here.

I might add more later but need to get on to other tasks so I wish you all a blessed end to November!  The moon sure has been bright and pretty and all of the kids and inmates have been running wild this week!

Ed

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Hot Cider And Firewood

We must be approaching 10 cords of wood cut and split this fall.  That's the most wood I have processed in a long time.  It's good to be able to get out in the fields and cut wood.  It's even better to have the energy to be able to do it.

I do need a good firewood cutting buddy though, hopefully younger and more mechanical than I am.  My sons are so busy they don't have time to help dear old dad so I beg and borrow and steal just like my dad did.

I stuck my saw into one of those ash logs yesterday and the chain went instantly dull.  Sparks flew off like it was petrified.  They don't make cutting chain like they use to but the same thing happened 40 years ago!  Catching wood in the right state to cut is a wood cutter's task, there are days to plant days to not and days to cut and days and days to burn!

The electric bill should be low this month and the propane needle hasn't moved from all this firewood activity.  We have our energy useage down to a formidable challenge.  I know what it takes to heat and cool this 1880 house now affordably, all 330 square foot of her.

I tried a new hot cider recipe tonight.  It got thumb's up from the head cook.  I put allspice, cloves, brown sugar, a pinch of nutmeg and a whole sliced orange into the basket of the coffee maker.  I poured in 2 quarts of apple cider and let it brew.  You could tell by the smell it was going to be good but the taste was even better!

I picked up a ton of wood pellets for the Countryside stove on sale at TSC for Black Friday, less than $4 per bag.  Of course they were selling the low bidder so I don't know what I bought but I will soon find out.  It is a hardwood pellet made by American Wood Fibers out of Columbia, Maryland.  They claim the world's largest wood chipper and wood flour maker.  I never heard it called wood flour before, I think they mean sawdust.

We made the trip southeast last night for my sister's birthday.  It's been too long since we have been there but everyone is so busy in their own lives today.  Her principal came into her classroom yesterday to annouce she was 72!  Yes, he is still alive but you know about paybacks.  He kept asking if the class had sang to her yet and they were confused so they started chanting something about passing their math requirement!  I thought that was pretty funny and priceless.  I think some students won some brownie points!

It was good to see Lisa and Joshua and Fred.  My neice is a principal herself now so our family keeps advancing in the field of education!  It's good to be outstanding in your field!

Today is another great day to be out standing in my fields, so I better get to it.

Have a great day!

Ed

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Organic Matter

Darren and Brian Hefty discussed a great topic on Ag PhD this week, organic matter.  Farmers like to talk about organic matter because it does matter!

Each one percent of soil organic matter allows it to hold 4% more water.  That was critical in this year's drought.  This is what farmer's call "good land" or better land because it yields more.  Each one percent also holds 20-30 pounds of nitrogen so a 5% organic matter soil can provide 100-150 pounds of nitrogen to the crop produced on it.

Each percent also holds a few pounds of phosphorous and a little less sulfur, all valuable nutrients to produce a crop.  All those tons of plant material on top of the soil may turn into a tiny bit of humus, or soil organic matter over time.  It all depends what you do to it.

A main benefit of notilling is to slowly increase organic matter content of soil over time.  This is why I feel soil should never be tilled unless you just have to or don't know any better!

"•Nutrient Supply


Organic matter is a reservoir of nutrients that can be released to the soil. Each percent of organic matter in the soil releases 20 to 30 pounds of nitrogen, 4.5 to 6.6 pounds of P2O5, and 2 to 3 pounds of sulfur per year. The nutrient release occurs predominantly in the spring and summer, so summer crops benefit more from organic-matter mineralization than winter crops.

•Water-Holding Capacity

Organic matter behaves somewhat like a sponge, with the ability to absorb and hold up to 90 percent of its weight in water. A great advantage of the water-holding capacity of organic matter is that the matter will release most of the water that it absorbs to plants. In contrast, clay holds great quantities of water, but much of it is unavailable to plants.

•Soil Structure Aggregation

Organic matter causes soil to clump and form soil aggregates, which improves soil structure. With better soil structure, permeability (infiltration of water through the soil) improves, in turn improving the soil's ability to take up and hold water.

•Erosion Prevention

This property of organic matter is not widely known. Data used in the universal soil loss equation indicate that increasing soil organic matter from 1 to 3 percent can reduce erosion 20 to 33 percent because of increased water infiltration and stable soil aggregate formation caused by organic matter."

This is about as simple as I can show you, don't till!  I have to watch myself driving down the road and see some poor soul fall plowing.  I have uttered the ugly words, "damned tillers!"

Tilling releases that precious carbon in organic matter to the atmosphere.

Lord knows we don't need any more carbon in our air.

Whether or not  you're a row crop farmer, plant trees so we can breathe!

Ed

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Land Capability Classes

The subject of land capability classes came up in the comment section.  What are they?  Basically, soil scientists have divided all types of land into VIII or eight major classes, all based on slope but two.  Flat land can be very productive or be so wet has to be called swamp land.

This is how I taught them as recent as 10 years ago, though the system has been modified over the years.  This PDF file of the Ohio Land and Soils Conservation Judging Scorecard will show you what I am talking about.  Here is another simple scorecard that can help you evaluate your land.

The new farm has about every land class on it, from flat, fertile, well drained bottom soils to soil that is so hilly steep and erodible, a mountain goat would be needed to cross it.  That is where the deer hang out.  We farm classes I-IV which are basically broken by slope.  We can pasture class VI land and the rest is not too useable for a farmer except to look at it every so often.

Class V is flat, wet swamp ground and we do have some of that.  We could barely walk across it in this drought.  Class VII and VII is that mountain goat ground.

The class IV and VI type soils on this farm are signed up into CRP, the Conservation Reserve Program.  That is a good way to get a little payment on hard to farm ground so we plan to leave those soils in that program.  These soil have heavy grass, some Scotch Pines and wild cedars on it and we like the look of it.

The first thing I did was soil sample the tillable ground and sent it off with my crop history and planning sheets to Midwest Labs.  I will discuss the results with lab agronomist John Menghini and my network of soil fertility friends.  I suspect it needs every crop nutrient in a better balance like other soils I have sampled here.

The second thing is to repair the tile lines and build a road to the back of the farm.  The recreational land is not accessible unless you have a drought like we are currently in.  That will be expensive, the last road I put in was around $13 per lineal foot with excavation and stone.

I found 3 different tile breaks so far so repairing them will really help the drainage.  You wouldn't believe how much better our other fields work just by doing this and farming them to the best of my ability.

We are planning a pond and a basement for a log cabin in the future.  The land does not offer itself that well for a pond.  The cheapest way to build a pond is dam up a narrow point where the water flows from a large area.  This is more a smaller funnel running into a wide open creek area so the dam would have to be much wider.  That gets expensive.  I don't even know if we can do that yet but money fixes everything you know.  Some are just cost prohibitive.

It was all in corn last year so I plan to plant it to soybeans, plant wheat on the erodible ground and plant a cover crop on the bottom ground.  That is subject to change of course as winter comes and leaves.

I am sure it will need lime so I really want to get that done first.

Knowing your land capability is a very important concept to understand.

Ed

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Diner, Not Designer

When I made coffee this morning, the Eight O'Clock coffee was sitting there to use so I made coffee with it.  The last time we had it, LuAnn said that was diner coffee.  Coffee like you get in the many diners we have eaten at.  I said this is definitely diner coffee this morning and she said yes, it's diner not designer.  You should blog on that!

Are you a diner type person or designer?  I would bet I have some of both reading here but I would think there would be more of us diner types.  I do like to eat at the diner once in awhile, I even took my good friend Mr. Wilson and his wife there for lunch!  In fact I've taken many of my visitors to the little Lynchburg diner.

Designer is Starbuck's and Panera Bread type outfits to me.  I do like to stop there once in awhile, too, but I am too cheap to visit often!  My tastes were formulated on "barely getting by" and I never had anything very expensive until I got out on my own.  Victoria Station was a real treat in the 70's but the bowling alley near Mt. Orab was just as good and a more regular hangout for us.

My discussion group talked about our faith in tomorrow and the future.  I have met several struggling with faith in the last couple of weeks.  Our daily devotional included the following this morning and it summarizes it all for me.

"It's easy to lose faith when we are troubled.  As we are buffeted about by life, we may feel the faith we once had has slipped away.  We begin to feel anger towards God or life in general."

Simon Peter had his ups and downs with God.  On the night Peter would betray him, Jesus said "Simon, Simon, Satan has asked to sift you like wheat, but I have pleaded in prayer for you that your faith shall not completely fail.  So when you have repented and turn back to me again, strengthen the faith of your brothers."

Life is surely being sifted like wheat, the chaff blowing in the wind and the good kernals drop straight down.  After 62 years, I've had a lot of chaff sifted!  My family looks like pretty good kernals left.  That strengthens my faith and what I have done.  I can't give you faith, I can only share mine with you.

It's good to share my faith with you here, at the diner or at one of those designer places.  You pick the place.

Ed

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Land Bid

I started playing with the Land Bid calculator before bed last night.  I see I could have paid more than we did for the farm we bought last week.  That's good, I am within my safety zone.

It worked just like it did 25 years ago.  I remembered sitting down with farmers in the extension office and grinding out numbers from "what if?" questions.  I also remembered really discussing and analyzing the terms learned in my agricultural economics classes at Ohio State.  I remembered Professors Warren Lee, Himes and McCormick!

The eleven factors LANDBID ask for are:

1. Price of recent sales is a reasonable estimate of the fair market value of comparable quality farmland in the surrounding area. The model uses this value as the base for the future growth in land value, depending on the rate specified in factor 10 below.

2. Opportunity cost is the annual, after-tax rate of return you can receive on your equity in an alternate investment of comparable risk. A good benchmark for the minimum rate is the after-tax interest rate on a first mortgage loan plus a risk premium.

3. Planning horizon is the number of years into the future for which cash flow projections are desired. Typically, 10 to 30 years is used for long range forecasting. This value must be 30 years or less.

4. Net income is the anticipated annual net return per acre. It equals gross income less all fixed and variable expenses except land debt servicing expenses. The going cash rental rate minus property tax and other ownership costs is also a good estimate of net income.

5. Marginal tax rate is the rate at which the next dollar of net income will be taxed, including federal, state, and social security taxes. Consult IRS and Ohio income tax tables for current rates.

6. Growth in income is the average annual rate at which you expect net income to grow over the entire planning horizon.

7. Proportion paid down equals the down payment as a percent of the land purchase price.

8. Mortgage interest is the effective interest rate you will be paying the lender.  Include the effects of closing costs, appraisal fees, stock, etc… on the effective cost of funds.

9. Loan amortization period is the number of years that it will take to repay the loan.

Standard terms are between 15 to 30 years. If the loan amortization period exceeds the planning horizon, the outstanding balance of the loan is repaid when the land is sold. This value must be 30 years or less.

10. Land inflation is the average annual rate at which you expect the land value to increase.

11. Capital gains tax rate is the rate at which any gain in value will be taxed upon the sale of the land.

Take some time and think these over.  If there are any you would like to discuss, let me know.  We could debate the future all day but we have to come to some agreement and conclusion before bidding on land.

One thing not to forget is soil test the farm before bidding!  This is often hard to do but will give you a much better idea on the productivity of the farm and what you will need in expenses to meet your goals.

We will discuss soil test results again soon in a future blog.  What's these woods worth to a grain farmer?

Blessings,

Ed Winkle

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Making A Farm Cash Flow

Yesterday we talked about how do you decide what you can pay for a farm.  I see the old Land Bid spread sheet is still available from Ohio State.  This is the program I used to help clients decide what to bid on a farm.  I have not "played" with it yet so someone let me know how it works for you.

How do you make a farm cash flow for purchase?  It all starts with net profit per acre.  From the link we can see the Ohio State University budgets calculate a $400 per acre return to labor and mangement for corn in 2013.  We assume the buyer as the ability to make this happen through his own efforts or through custom operators and advisors.

If the farm has been in soybeans the last year, it is easy for me to transition to notill corn.  This is exactly what a lot of my neighbor's fields needs, a rotation to corn for 2013.  Many farms will already be in corn and be ripe to go to notill soybeans.  This reduces cash expense and could be profitable for 2013.  From the link we see that soybeans can make us another $50 per acre with less cash expense.

This is only one year.  A farm mortgage is typically a 30 year mortgage so what about the other 29 years?  Farmers do not expect that kind of net income every year and I remember plenty where half that profit was about all I could milk out of the soil and marketplace.  So pick a figure you are comfortable to build a repayment schedule for your purchase.  There will be good years and bad but the purchase must cash flow.

There are so many other variables from farm to farm and person to person, you really need to be able to analyze the variabilities.  This is where a consultant like me with 40 years of experience can help with your decision making.  I am not advertizing myself but stating a fact.  It's taken me a lifetime to be able to do what I am talking about and trust myself to share my knowledge and experience with others.  There are many people out there with my experience who can help you.

Take a look at your personality, net worth sheets, ability to manage money, your past history and your potential to get a better handle on your ability to pay off your purchase.  I know now I could have done this 40 years ago but it's taken me a lifetime to get to a place where I feel comfortable in buying and selling land.  I was not taught this and it did not happen overnight.

The picture shows a farm with some CRP and woodland.  It will not return much profit, if any.  This is where your taste, needs, and financial ability to enjoy non-farmland come in.  If you have a big family like ours, a farm with all tillable land is not as enjoyable as a more diverse piece of land but it doesn't cash flow, either.

What questions do you have?  What topics would you like to discuss?  This blog is here for you as much as it is for me.  I enjoy doing this stuff, I hope you do, too.

Ed

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What Is Your Motivation To Buy Land?

"ie what is your reasoning on a purchase or what details do you consider on a potential purchase?


I ask out of curosity. Have been contemplating another farm, unfortuantly, I as of yet have not figured out a way to make one pay. Need the land but snowballs chance in hell of actually renting land around here, only alternative is purchasing, which is more attractive and equally unfeasable at the moment. I just wonder what the rest of you consider in a land purchace, what motivates you?"

My response-"My reason was I had none. I owned very little in fact and one needs land to farm. Land has always been difficult to rent here so owning is about the only way to get in. Now making it pay as you said, is a whole different ballgame.


Wanting is one thing, necessity another but it must cash flow. You must figure out a way to cash flow it to finance it since most of us can't buy it outright.

The best thing we have going for us is high grain prices, fairly stable inputs this year and the lowest interest rates I've seen in my lifetime. That also is true for all of my competition so someway I must figure out an edge on them and make it work.

Another motivation is I trust my ability to produce income from land more than I do the bank, stocks, machinery or any other investment out there.

Producing a profit is what Ag Talk is all about to me, with some good friends on here, too."

Let's look at land from strictly a payback proposition for farmers.  How do you figure what it takes for land to cash flow?

This was one of my jobs as an Extension Agent in the 80's and 90's.  I was able to write a grant for a laptop computer that I took to the University where it was loaded with software, mostly written by Extension professionals.  One of those programs was one where you entered your data and came up with the maximum amount you could afford to bid on a piece of land, rental or ownership.  Of course, the output was only as good as the input and this could be done on legal pad.

Most programs only figure your payment.  They are basically a mortgage calculator.  The important part is how much income you can produce from a piece of land and how accurate is your forecast.

We will discuss this tomorrow.

Ed

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1977

For some reason today I got to thinking about some of the things I did 35 years ago.  We had the worst winters I've seen in my lifetime.   Matthew was Deirdre's size and I am now my dad's age when all of this happened.  I won the state tractor pulling championship(that's the tractor and me in the top left corner( and my eye was one year healed from surgery.  My, things do happen.

I was in my sixth year of teaching at Blanchester.  I had finally learned how to teach and maintain some kind of semblance of classroom control.  I had two really good students, Randy and Brett that made teaching fun.  They actually helped me be a better teacher by setting good examples and being strong role models.  No one messed with them.  My, things do happen.

We had built a profitable school farm of 80 acres with a good line of machinery.  I was really into mechanics and ham radio at the time.  We lived at Fayetteville where I go to church now and Matthew teaches.  I had a new Kenwood TS-520 and could talk to about anyplace in the world I wanted to.  The Radio Shack CoCo or color computer and the Model I and III were about to show up and take over that world.  My, things do happen.

It's funny how you remember this working outdoors.  I've had a lot of peaceful moments in the fields where I can think.  I cleaned out a pile of cedar posts I have been meaning to clear 3 years ago.  I get such great satisfaction from such little things.  My two good men showed up at 2:30 p.m. and I gained new life.  I sawed wood like I did 35 years ago.  I still have 20 logs to saw up but the pile isn't so big now.

I have been in a wood sawing frenzy since this good weather just keeps coming.  Tomorrow might be the end of it but still the forecast isn't that bad.  TSC has Carhartt winter coats on sale for 50 bucks for Black Friday morning and Poulan Wild Thing chain saws for $99.  I might pick up one of each.

A bug went through the family after First Communion and LuAnn spent the day on the couch.  She found out the communion family had it first.  Wouldn't you know she asked me how much sick leave she had used this year last night.  I guessed 14 hours, she said the answer is 11.  She almost doubled that today.

So what are you having for Thanksgiving dinner?  Turkey and all the trimmings?  That is all that has been on TV and how many hundreds of thousands of meals that have been given away.  That didn't happen 35 years ago.  We all stood on our own two feet, at least that we knew about.

Now HOPE Emergency feeds 400 people right down the road where we used to live.  I can't say the world is a better place 35 years later but it is what it is.

What do you out of the states readers do today?  I don't remember being in a foreign country on Thanksgiving to see what it is like somewhere else.  Maybe we were a few years ago when we cruised the Danube but I don't remember.

I do give thanks today for what we have and what has been sacrificied, just like I did in 1977.

Ed

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100 Today

"Today my dad turned 100. He was born a mile North of where I live on the family homestead. He is the oldest of 6 children. He has one surviving sister. He served in World War II. He was drafted into the army in 1942. After boot camp he was assigned to Battery C of the 692nd Field Artillery Battallion at Fort Sill OK. He landed in Normandy France in August of 1944. From there they moved inland and fired their first 105mm howitzers shells in combat at Borne Holland. His unit supported the 84th Infantry Division at the Battle of the Bulge. After the Bulge they crossed the Siegfried line into Germany.


After the war he returned to the family farm. In 1960 he married my mother. I am the youngest of his five children. I was born in 1967 a month before he turned 55. He has 11 grand children. The oldest is 25 and the youngest is 12.

In 1997 he had an asthma attack and quit breathing. I was a few miles North of where they lived when my wife called to tell me. I was able to get there in time to perform CPR on him and revive him. 15 years of life that he would have missed. I am glad I was there.

This weekend we hosted a family dinner and open house for him. We had over 135 people attend. It was a good weekend. All of my family was able to attend as well as several cousins. It was good to see everyone.

This afternoon we took him over to the house where he was born a 100 years ago and took his picture. After that we came back to my house and had a small birthday party for him with two of my sisters and their family. My second cousin from Edmond, OK made the birthday cake we had tonight. I don't know how many layers it was but it was rich.

My dad was a simple dirt farmer. He has lived his life with a strong faith in God, a willingness to help his fellow man, and a thirst for knowledge. He may be 100 years old but he still reads books and wants to learn."

Happy Birthday Mr. Sanders and thank you for your service!

Ed Winkle

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Two Good Men

I need two good men today.  Anyone available?  All my part time help is busy doing other jobs.  Maybe 2 men and a truck are available.

I just sent a garbage bag full of jackets and winter coats to Turning Point this morning.  LuAnn has a good worker who doesn't have enough (any?)coats so I fixed him up.  Tractor Supply has a sale on Carhartt's this week and I love new Carhartt's.  It's amazing what you accumulate over time.

Everytime we travel west or east to Pennsylvania we stop at Cabela's.  I usually end up buying a coat on sale.  The next thing you know, they won't all fit in our mudroom closet.  I just cleaned mine out and it is still pretty full.

I need to do that with shoes, too.  I have a bunch of good workboots I can't wear comfortably anymore and there is always someone around here who can use a pair.  10 years ago you couldn't give away this stuff and now it's in high demand.  There is the American economy for you in Ohio right there.

HOPE Emergency does a good job of distributing these goods to local, needy people.  We like helping them.  This is their busy week to try and get a Thanksgiving meal to all of their families.  I think the number is around 400 right now.  The local churches and other groups have been accepting donations for a month or so now.

Those barns housed a lumber store years ago that should have never been built out in the country.  It went belly up and a friend of mine bought it.  I forget the story how the sisters ended up with it but it must be on their website somewhere.

This was brought up on ag talk this week.  "Had a little farm got sold today 67 acres +or- only 52 tillable in 4 fields with a power line running through the biggest field is 17 acres and the smallest is 7 acres trees on 3 sides, a farm place in the middle of it that is sold to someone else no tile and light soils and rolling ground sold today for around $9700.00 an acre tillable and the farmer that bought will have to buy new equipment to farm it because his equipment is to big for it. The 2 guys that bid against each other I heard do not like each other. I wonder who one the fight?"

There are others who have been reporting actual fist fights over land rental and purchase.  That's not a good sign!  I told them to come to poor old Ohio where 84 acres sold for $3250 per acre last week and 440 acres of rough ground only brought $500,000.  Some people can't believe that but it's true.

I better get to work.  You have a good day.

Ed

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Blessings

First of all today I want to say a special prayer for Irv.  I found Irv last night.  He is fighting a tough struggle with pancreatic cancer.  The numbers are not in his favor but we know with God all things are possible.  I just don't know what God's Will is for Irv so I have to pray they come true.  We know all things turn out good in the end if you are on the right side.  There are a lot of friends hurting right now and we pray for their peace and their healing.

We got to witness our oldest grandchild receive her First Communion yesterday.  The church was packed to Standing Room Only as family and friends gathered for the celebration.  Hearing that little girl, now young lady say she came on her own free will just made our hearts sing.  You couldn't force her to do something she didn't want to if you tried.  She knows right from wrong.

We got to see almost all of our grandkids this weekend.  Baby Deirdre is the quietest little newborn you can imagine.  Liam tickled us though, he said "Now if it were just Deirdre and me, life would be so much simpler.  That Caoilin and Finn, they are always into trouble!"  He grows so many ways every time we see him.  I think he will be a better big brother than I was.

Baby Katherine will be baptized in two weeks.  That will be a very special day for all of us.  She is one of those babies who could compete with the famous Gerber babies for cute and adorable.  LuAnn has each grandchild's picture hung up the stairway to the top floor so we get to see them every morning and every night.  Every one of them fit that category to us.  We have a handsome set of grandchildren!

We have so enjoyed the weather this month!  It has been pretty much gorgeous in southwest Ohio.  I hope to keep replenishing my firewood supply as winter draws near.

Farmers who are still shelling corn are very lucky compared to last year.  This fall is more like 2010 which seemed to go on forever.  However, this gives the tiller guys too much time to tear up ground while the rest of us work on fencerows, lime and tile issues.  I imagine everything that is going to be planted this fall has been planted.

Some things to ponder this winter:
Soil Health and Civilization
Modern Day Challenges
Solvita Soil Health Test
Rick Haney's Work With Soil Health
Soybean Inoculation
Naturall Inoculant

This should be enough good work to keep the blessings flowing!

Have a great week,

Ed Winkle

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