July, 2016

  • The 25 Year Trend in Crop Input Costs

    Farm Doc Daily released a report today on how crop input costs have not dropped much in the last couple of years. The report presented a chart showing the total costs for high-productivity farms in Central Illinois from 1990 to 2015 for Seed, Pesticide, Fertilizer and Cash Rents. As you can guess, the lowest cost year for the crop inputs (seed, fertilizer and pesticide) was 1990 at slightly less than $100. It took until 2005 for these costs to exceed $150 per acre.


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    Ongoing Need for Farm Financing is Pressuring Farmers

    The Federal Reserve Bank of Kansas City released their second quarter Agricultural Finance Databook  and as expected, the need for operating loans for farmers over a continued period of time is weighing on farmers.  Here is my analysis regarding the charts and information provided in the databook. Chart 1 shows the percentage change in Number […]


  • How to Pay Your Children

    The Tax Court released a case earlier this week (Embroidery Express LLC TC Memo 2016-136) that provides very good advice on how to pay your children (or how not to pay them).  As we have previously indicated, one of the best deductions for farmers is to pay their children under age 18 (for sole proprietors […]


  • 2016 Global Fraud Study Results

    The 2016 Report to the Nations has been published by the Association of Certified Fraud Examiners and can be accessed in full here: 2016 Global Fraud Study. Here are some highlights directly from the report I thought may be of interest to the followers of this blog: The median loss for all cases in our […]


  • Why Farming Is Great

    Last week, my wife and I attended the annual Farm Financial Standards Council meeting in beautiful Ranchester, Wyoming (just north of Sheridan).  The meeting was hosted by the Padlock Ranch and they did a great job of providing a meeting site and dinner and lunch.  I even got to rope a calf (it was a […]


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    Managerial Accounting Performance Standards

    One of sessions after lunch dealt with managerial accounting for a large agricultural operation (almonds, cattle, potatoes, etc.). One item that was brought up is that any accounting system for any farming operation no matter the size should meet certain performance standards as follows: Timeliness – perfect financial information in an untimely manner does not […]


  • The Farm Financial Standards Council Annual Meeting

    The annual Farm Financial Standards Council meeting is being held this week in beautiful Ranchester Wyoming at the Padlock Ranch. The ranch contains about 420,000 acres and has three main sections located primarily in Southeastern Montana with part of it in Northeastern Wyoming just north of Sheridan. Wednesday afteroon the council had their committee meetings […]


  • Do You Know Your Breakeven Point?

    AgStar Financial Services recently posted an article asking Where’s Your Break-Even?  We work with a large number of farmers with a wide range of farm sizes and it is still surprising to me how many farmers would not be able to answer this question or other questions regarding their finances.  It is still not that […]


  • Wheat Growers to get 61 Cents From 2015 PLC

    Art Barnaby of Kansas State University released his latest information on the MYA prices for the major crops for the 2015/16 marketing year.  The corn and soybeans marketing year ends August 31, however, wheat (and other cereal grains) ends May 31. For the 2015 harvested wheat crop, the final MYA price is determined for the […]


  • Will CCC Loans Limit My Farm Loss

    The tax laws require excess farm losses to be limited if the farmer receives an applicable subsidy or has a loan from the Commodity Credit Corporation (CCC).  Applicable subsidies were direct, counter-cyclical and ACRE payments under the old 2008 Farm Bill.  These payments were repealed by the 2014 Farm Bill, however, loans from the CCC […]


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