I’m among survivors -- dairy producers in Dakotas and several other states who turned out for the Central Plains Dairy Expo in Sioux Falls. They’ve gotten through more than a year of record low prices and are still in business.
But they’ve apparently go a ways to go yet.
Gary Sipiioski, business development manager for Vita Plus, former bank president and member of the Federal Reserve ag advisory committee, says recovery is still on the horizon. Maybe it will finally take hold later this year or maybe not until 2011.
His advice to dairy producers who want to continue to be among the survivors seem applicable to everyone who farms and ranches. Here’s some points I took away:
- Manage margins. Know your costs and take a profit -- even a small one -- when you can.
- Cut costs that don’t affect production.
- Invest in things that increase production.
- Manage risk. That mean’s having a real marketing plan, not just a “I’ll-keep-the-road-plowed-so-the-milk-truck-can-get-in plan." Work with somebody who can help you market milk, Sipiroski says, even if it just with your co-op. This is what lenders expect.”
- Lock in interest rates. Spiroski and others fear interest rates will rise sometime – and sooner rather than later.
- Stay positive. Be good to yourself and your family. Meet with other producers who are upbeat and positive. Get good information to help you make decisions and above all, “keep talking to your banker,” says Sipiorski, a former a banker.