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The Cost Of Farming

Kealey Bultena
/
SDPB

As the winter weather socks South Dakota, farmers are harvesting their remaining crops from the fields. Across the country, more than 40 members of the United States Congress are conferencing on the latest versions of the federal farm bill. It’s a critical piece of legislation for farmers – and west river ranchers, who were devastated by a blizzard one month ago. But the business of producing food hinges on much more than the farm bill.

It’s like watching one of those claw machines you can use to grasp for stuffed animals at an arcade. But this operation at the Bones Farm in rural Parker is massive with real industrial machines. Plant particles are chopped into small pieces for cattle field. 

Walt Bones is South Dakota’s former Secretary of Agriculture; he farms in the southeastern corner of the state. He describes how he and family members have livestock enterprises. They also grow corn, soybeans and some wheat.

Bones says it takes between $700 and $800 to plant an acre of corn.

"The average sized farm here in South Dakota is about 1,400 acres, so just multiply that out," Bones says. "Take 700,800 dollars times 1400, and that’s a tremendous amount of money."

Bones says that translates to a tremendous amount of risk. The massive federal food and nutrition legislation known simply as the Farm Bill contains a federal crop insurance program., but he balks at the notion that farmers frequently profit from crop insurance. He’s done more of the math.  

"In the previous 10 years, of every dollar that we spent on crop insurance, we’d gotten back about 12 cents," Bones says. 

Bones says 2012 is the exception, because South Dakota’s drought-stricken fields pulled in more crop insurance payments . He says taxpayers do support some of the burden of a nationwide crop insurance program,  but Bones and fellow farmer Paul Schubeck both say crop insurance programs are vital to maintaining a stable domestic food supply.

"Can I justify subsidies to farmers? Probably not," Schubeck says. "Can I justify things like crop insurance? You bet, because I don’t think we want to be held hostage for food."

Fewer farmers now grow crops on bigger farms in South Dakota than in the rest of the state’s history. That means they have to command expanding fields with constantly-changing technologies. Schubeck says farmers manage all aspects of operations.

Credit Kealey Bultena / SDPB
/
SDPB
Bales sit before a grinder chops the refuse for cattle feed at Walt Bones' family farm near Parker.

"People have this misconception that farmers are 'less than,' that they’re dumber than the average bear," Schubeck says. "The truth of it is, most of the farmers I know have college degrees or vocational degrees or advanced degrees."

Schubeck stands feet away from a tall combine. He farms more than 1,000 acres between Centerville and Beresford, and his son is taking a greater role in the family business. But the veteran farmer says it’s rare that someone starts in the business without help from already-established farmers.  Schubeck says today’s farming requires managing millions of dollars.

"It might be valued that much today because land values are so high, but I’ve been in this business long enough to know that land values can fall in half in a year, and they might, because the commodity prices have gone down," Schubeck says. "And we’re kind of at that edge where things are going to change as the economy goes in rural America."

"Land, in the area where I live which is the east-central South Dakota, a farm was sold Saturday for $10,000 an acre," the executive director of the South Dakota Farm Bureau, Wayne Smith, says.

Smith has been farming since the late 1960s. He says, like most things, it costs more to do business, but commodity prices don't always coincide with expenses. 

"If you take the high-$3 corn and try to cash flow it, in many instances, you’ll need more bushels than you can grow per acre to make everything cash flow," Smith says.

Harvest is an additional cost. Combines can cost a quarter of a million dollars, and big machines are essential for planting the right number of seeds in the right places in the right conditions. Smith says non-farmers who spot spiffy equipment as they pass fields shouldn’t assume farmers are pulling in huge profits.

"In my operation, I get by with used equipment," Smith says. "I don’t buy the brand new, but we try to keep the equipment shined up and waxed, so it looks like it’s got shiny sides to it."

Smith says South Dakota farmers have to fight a lot of misconceptions, and many farmers have loans on machinery and pay rent to landowners.

Back near Parker, farmer and agriculture advocate Walt Bones muses about the history of the soil he works today. His great-grandfather homesteaded here in 1879.

"Physical work? Instead of going out with a pitchfork and pulling a trailer out with the horses and pitching the hay off, physically, now we jump in the tractor and hit the hydraulic button, so we get a lot of exercise in our wrists and our arms and our hands, maybe, running hydraulic levers," Bones says. "So in that respect, the physical work is probably easier."

But Bones says managing farming operations requires intense mental ability that small farmers never had to handle. He says it used to be that the farmers who worked the hardest were the most successful. Now, Bones says, grit isn’t enough; farmers who succeed have access to capital and must possess real-world business sense. 

Kealey Bultena grew up in South Dakota, where her grandparents took advantage of the state’s agriculture at nap time, tricking her into car rides to “go see cows.” Rarely did she stay awake long enough to see the livestock, but now she writes stories about the animals – and the legislature and education and much more. Kealey worked in television for four years while attending the University of South Dakota. She started interning with South Dakota Public Broadcasting in September 2010 and accepted a position with television in 2011. Now Kealey is the radio news producer stationed in Sioux Falls. As a multi-media journalist, Kealey prides herself on the diversity of the stories she tells and the impact her work has on people across the state. Kealey is always searching for new ideas. Let her know of a great story! Find her on Facebook and twitter (@KealeySDPB).