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Mitigating volatility through 2023 farm budgets
An ag economist says farmers need to sensitize their budgets to make a profit in 2023.
“Volatility can be mitigated. It just takes work.”
Matt Erickson, Economic and Policy Advisor with Farm Credit Services of America tells Brownfield farmers should preserve their working capital and understand their cost and revenue structure.
“If we have volatility, prices are going to go up and prices are going to go down on black swan events that seem to happen every other day. But, by being better experts of your margin or break even, that allows you to act. As I always say, a pencil has an eraser, and it is ok to change numbers if you haven’t locked in some of those prices.”
He recommends farmers think about their farm holistically and narrow down budgets to cost per acre so they know what they have to work with when it is time to act.
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