Thecost of growingcropscouldoutpace revenue formany farmers in 2022,making itmoredifficult tobreakeven—despite risingcommodity prices and increased demand domestically and globally. AnAmericanFarmBureauFederationMarket Intel report concludes that farmproduction costs are likely to increase 6% in 2022, which fol- lows a 12% increase in 2021. This continues a trend stretching back several years. Since 2013, farmers have seenalmost all productionexpenses increase. For exam- ple, livestock andpoultry expenses have gone up 46%, andmarketing, storage and transportation costs have increased 59%. Farmers are seeinganumber of productioncost increases including: • Rising fertilizer, seed and chemical prices, which nowmake up to 17.5%of on-farmexpenditures. •Rising fuel andenergyprices, exacerbatedbyuncertaintydue to the Russia-Ukraine conflict. • Increasedcosts of labor, bothon-farmand for agribusinesses serv- ing farms. • COVID-19 disruption of labormarkets and production. “The rising prices for fuel, fertilizer and other supplies create an un- welcome counterforce to higher commodity prices,” AFBF President Zippy Duvall said in a statement. “Higher prices for crops are getting a lot of attentionright nowandof coursehelp farmersbalance thebooks, butwhenexpensesare rising just asquicklyor evenoutpacing revenue, the financial gains evaporate. Right now, there are serious concerns about whether farmers will be able to access the supplies they need to put a crop in the ground.” AFBF said it is working to ensure the administration and Congress understand the severity and potential implications of increased pro- duction costs and the limited availability of some supplies. The organization is launching a series ofMarket Intel articles exam- ining rising farmproduction expenses. The Market Intel report analyzing fertilizer prices was published in December. The report said data from the U.S. Department of Agriculture indi- cated that fertilizerwouldaccount for the largest cost increase in2002. Here are some other hightlights of theMarket Intel report: • Theglobal outlook for commodityproductioncontinues to increase, accordingtotheMarchWorldAgriculturalSupplyandDemandEstimates. •Russia’s recentmilitaryaction inUkrainesignificantly increased the uncertaintyof agricultural supplyanddemandconditions inthe region andwell beyond. •TheCOVID-19pandemicalsodisruptedlabormarketsandinterrupted theproductionof goods, including crop inputs,whichhas led toproduc- tionlaggingbehinddemand, andtheprice increases that typically follow. • Since 2013, farmers have seen nearly all production expenses in- crease. Most notably, livestock and poultry farm-origin expenses have increased 46% and marketing, storage and transportation expenses have increased 59%. •One potentially interesting note is a potential shift away fromrent- ing ground, as rents decreased from2021 to 2022 by 6%, and farmers transitioned to owning real estate, as shownby an 11% increase in real estate interest expenses from2021 to 2022. “The ever-evolving farm business budget continues to be on the minds of all farmers and ranchers this growing season,” concluded AFBF economist ShelbyMyers, who authored theMarket Intel report. “In timesof increasedvolatility, farmers andranchers continue to try to findways tomake sure they can pay for all their necessary crop inputs, evenas the price of those inputs continues to rise.” While crop revenues may be up this year, production expenses are rising just as quickly and couldpotentially outpace revenues. “This is leavingmany farmers to question their ability to just break even this year, despite high crop and livestock prices,” Myers wrote. “While increased investment andcapacitymayhelp in the long run, in thenear term, farmers are concernedaboutmaking sure theyhave the inputs they need to put a crop in the ground, especially at a timewhen the pressure to do so is rising. “The question is, will they be able to afford to do so, or will it be too expensive to farm?” FutureMarket Intel articleswill explore the rising cost of production expenses including for seed, pesticides, energy,machinery, land, labor, credit andwater. Report: Growing costs could exceed revenue
REAL ESTATE
REAL ESTATE
I have been representing the Sacramento Valley area for over 46 years. Would like to help sell your property or help you buy, let me knowwhat you need. 31.1+/- acres, located between Madison & Winters, row crop, district & new well water, with orchard and homesite potential. $850,000
10± ACRES – West Side 2,311± sf 3 bed/3 bath home with large shop 11± ACRES – Cabernet vineyard on wire, planted in 2001. Contracted 13± ACRES – Primitivo Zinfandel with contract. 3 parcels. West Side Lodi 15± ACRES – Move-in Ready 3/2 home in Tracy 17± ACRES – 1,200± sf home, 10± ac of Ruby Cabernet & 5± open acres 20± ACRES – Two parcels total over 20± acres. Merlot & Zinfandel vineyards 20± ACRES – Incredible location for a winery. Mokelumne River AVA 20± ACRES – Syrah vineyard located just east of Highway 99 20± ACRES – Spacious 2(4) bedroom/2 bath home with Petite Sirah vineyard 24± ACRES – Over 1,500± ft of Mokelumne River frontage. Great soils for planting 28± ACRES – Apple orchard located near Hwy 99. 30 HP pump 29± ACRES – 2 homes/3 parcels, large barn-soil should be great for an orchard 40± ACRES – Zinfandel vineyard with large 3,850± sq. ft. shop 42± ACRES – Income-producing riverfront vineyard. 4 parcels near Highway 99 51± ACRES – 4/2 turn-key home w/shop, agwells, and income-producing almond orchard 58± ACRES – Income producing Bing cherries and Pinot Grigio grapes 72± ACRES – 3 parcels of vineyards with 5 different grape varieties near Lodi 77± ACRES – 2 parcels. Cherries, walnuts & olives near Hwy 99 & St. Rte. 88 79± ACRES – Located in the Borden Ranch AVA. Plant an orchard or vineyard 89± ACRES – Bare land slated for residential development. Hwy 99 frontage 100± ACRES – Winery & vineyard w/tasting rm, tank storage, boat dock & more 166± ACRES – Multi-varietal vineyard with Consumnes River frontage 207± ACRES – 12th leaf Chandler walnut orchard in Stanislaus county 408± ACRES – 3 parcels. Large reservoir. Fenced for cattle. Shop. Valley Springs 881± ACRES – Irrigated pasture in Dixon, located in the North DeltaWater Agency. 17.02 AC Chandler Walnuts, planted 2007, 2 water sources, Hanford.................................$595,700 18.01 AC Chandler Walnuts, planted 2012, 2 water sources, Hanford.................................$630,000 24.71 AC Commercial, Rental Income and Hwy 198 frontage, Hanford ........................... $4,200,000 26.07 AC Heavy Industrial, Highway 198 & 13th Ave, Hanford, CA .................................. $1,475,000 30.11 AC Kern Delta, dairy facility, Union Ave frontage, Kern Co.......... SOLD .................. $1,204,400 60 AC Walnuts, Laguna Irrigation District & well water, Laton.......... IN ESCROW ............ $2,130,000 78 AC Row Crop, Empire ID & Kings Service Area, Stratford.......... SOLD .......................... $13,000/AC 80 AC Mature Almonds, Last Chance & wells, Hanford.......... SOLD ................................. $24,500/AC 88.55 AC Chandler Walnuts, planted 2013, 2 water sources, 4 APNs, Hanford................. $3,634,900 99.13 AC Walnut Estate, wells, custom home, Hanford.......... IN ESCROW ...................... $5,200,000 136 AC Alfalfa, I-5 & Hwy 58, Semitropic WSD & 1 well, 7 APNs, Buttonwillow............... $4,000,000 140 AC Pistachios, Lost Hills WD & 1 well, Lost Hills.......... SOLD ..................................... $37,000/AC 156 AC Thompson Seedless, Arvin EdisonWSD, shop & well.......... SOLD ......................... $3,600,000 204.36 AC Almonds &Walnuts, 2 water sources, Hanford .............................................. $6,600,000 320 AC Hunting Club - CUP, Semitropic Water District, 1 well, Buttonwillow .................... $5,000/AC 516.77 AC Dairy and Farmland, 80 shares of Bliss Water stock & wells.......................... $11,959,250 980.14 AC Mature Pistachios, MaderaWD, all or part, $21,000/ac......... SOLD .............. $20,582,940 1428.77 AC Almonds, Pistachios & Open, WWD &Wells, Three Rocks ........................... $22,500,000 CHECK OUR WEBSITE FOR DETAILS AGRICULTURAL REAL ESTATE PROFESSIONALS HOEKSTRA & ASSOCIATES, INC. @hoekstra.associates @hoekstra_associates Sean Barajas • 559-805-0179 • Russ Waymire • 559-977-6000 www.hoekstra.land Dan Hoekstra • 805-839-8292 CalBRE 02023290 Wanted: Land in Kings County with Lemoore Canal Stock or Peoples Ditch Stock Wanted: Pistachios or almonds with groundwater & surface water (80-640 acs)
Farm & Ranch Realty jeff@farmranchrealty.us 530-908-4689 Lic: #00554252
SERVICES AVAILABLE
OLIVEIRA ADVISORY SERVICES LLC Tony Oliveira economist and financial strategist with more than 30 years of general and fiduciary board services on private and public board of directors in- cluding agribusiness, government, insti- tutional such as (CalPERS) Sacramen- to, Tamina Homes London and more than 30 other private and public boards .Consulting and advisory services for strategic planning, refinance, workouts, and or growth or downsizing plans. REALTOR Broker – Economist - Fidu- ciary. Complete bio information availa- ble at oliveiraadvisory.com. Contact To- ny: Cell 559469-5119 Email tonytoliveir a@msn.com WOODLAND RANCHETTE & PRIME FARMLAND for sale. This charming 3 bd, 2 ba house is situated in the heart of Yolo county’s ag land with 31.5± acres of Class 1 soils capable of growing any of the crops grown in Yolo county, in- cluding orchards. The cozy one-story home with solar roof panels, remodeled bathrooms, pool & spa, and bountiful land has the potential for the finest and most serene of country living. Come bring your ranch dream to life! For more info, contact Natural Resources Group, Inc. at 916-372-5595 or mredmond@ natural-resources-group.com
FINANCING
PRIVATE/HARD MONEY LENDER Agri Capital, Inc. provides direct private fi- nance secured by agricultural properties in California. Call Scott Maxwell at 559- 825-6650 to learn more about our lend- ing solutions! CA DRE Lic. #01852219n
LOOKING TO RENT RICE GROUND Share crop or willing to pay cash rent up front. We use 100% of our own equipment to farm and do not rely on outside custom farming companies to do the work for us insuring that the quality of work being done is to our standard. Last 5 year crop average 95+ dry sacks an acre (documentation avail- able during negotiations). List of refer- ences or current landlords upon re- quest. We have been farming rice for over 45 years. (530) 682-1665 IMPERIAL VALLEY LANDOWNER seeks farm tenant for 985 net acres (12 parcels) prime farmland around Holtville. For information, submit qualifi- cations to cbarclay@oocrb.com or phone 619-255-1536
MISCELLANEOUS
Caterpillar Case IH Grainger Industrial Supply O’Relly Auto Products MEMBER BENEFITS
John Deere Dungarees Propane Discount Amerigas PAINT Discount Kelly Moore & Dunn Edwards Paint
VALLEY TRUST REALTY Ton y Oliveira Broker BRE 02071049 24476 Fairfax Ave. Lemoore CA 93245 More than forty years in Agribusiness experi- ence. Representing sellers of ag prop- erties and buyers seeking ag invest- ments. Specializing in marketability of agriculture properties, estate sales both real and personal property, and 1031 Exchanges. Contact Tony: Email: tony @ v a l l e y t r u s t r e a l t y . c o m . C e l l 559-469-5119
ESTATE WINERY WITH BUSINESS, VINEYARD & HOME, 24.82± AC in El Dorado County. Outstanding opportuni- ty to enjoy a home, vineyard, & profita- ble turnkey wine business with tasting room located in the Sierra Foothills. Furnished home with beautiful views and ample space to hold large events. For more info, contact Natural Resour- ces Group, Inc. at (916) 372-5595 or mr edmond@natural-resources-group.com.
800-698-FARM • 916-561-5500 cfbf@cfbf.com
March 23, 2022 Ag Alert 27
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