Let Michigan’s Agricultural Diversity Work for You!
Adding some diversity to your operation can benefit your business in several ways. Combining livestock and crops can help to improve your soil and decrease purchased inputs. Multiple crop species rotated can lower harmful insect populations, reduce weed pressure, and minimize specific nutrient deficiencies. Having income from a variety of sources can prevent large losses if a particular type of product has a challenging year either on the production side or the marketing side.
66 Year History of Corn Prices
Long stretches of basically flat prices.
Average Corn Prices were approximately $2.60 from 1973 to 2005
Adding a new enterprise or product to your operation will likely take some learning and new management skills, but the upside is, you have plenty of options and available resources right here in Michigan. Michigan State University and their extension network is a great place to start, but many other sources exist. I have attended a wide variety of ag focused trade shows across our great state including: Agro-Expo (General Farm), Great Lakes Regional Dairy Conference(Dairy), Great Lakes Expo (Fruit, Vegetable, Farm Markets), Crop Summit(Cash Crops), Bean & Beet Day (Dry Beans & Sugar Beets), MI Potato Growers (Potatoes), Mid-Michigan Potato Symposium (Potatoes), Herbruck’s Organic Growers Mtg (Organic Feed Growers), DFA Member Meetings (Dairy), MI Greenhouse Growers Council Events (Greenhouse / Floriculture) plus numerous others in our region.
Let’s take a look at some data from the 2015 National Agricultural Statistics Service. Michigan is home to more than 50,000 farms producing more than 300 agricultural products making us near the top of diverse agricultural states. Here is a list of some areas where Michigan is ranked in the top 10 nationally:
Michigan was #1 in value of 14 floriculture crop segments & 2nd in value in 8 floriculture market segments.
Michigan Ranks #1 in: Cucumbers, Dry Black Beans, Dry Cranberry Beans, Dry Small Red Beans, Niagra Grapes, Tart Cherries, Squash & Asparagus.
Michigan Ranks #2 in: All Dry Beans, Dry Navy Beans & Celery
Michigan Ranks #3 in: Apples, Blueberries, Dry light red kidney beans, Farmers markets & Snap beans for processing.
Michigan Ranks #4 in: Alfalfa haylage and greenchop, Sweet cherries, Carrots, Concord Grapes, & Sugarbeets.
Michigan Ranks #5 in: Milk & Tomatoes for processing.
Michigan Ranks #6 in: Pumpkins.
Michigan Ranks #7 in: Bell peppers, Egg production, Maple Syrup & Potatoes
Michigan Ranks #8 in: Cabbage, Honey & Peaches
Michigan Ranks #9 in: Corn for Silage & Goats for milk.
Michigan Ranks #10 in: Oats & winter wheat.
There are many other agricultural products that have a significant presence and are supported by MSU and private research, trade associations, independent consultants, and numerous supporting entities along with neighbors, which are often willing to share some knowledge obtained in their own operations. A few obvious ones are beef cattle, hogs, broilers, turkeys, sheep, dairy heifers, hay, sweet corn, rye, hops, strawberries, raspberries, onions, and peas.
Most of us have heard financial planners say that diversifying your portfolio is a sound risk management strategy. Don’t invest all your savings in one stock or even one fund of similar stocks. Try a few mutual funds that individually hold several stocks or bonds from different categories. Have both stocks and bonds as well. If you are looking to minimize risk on your farm, look for ways to accomplish this diversification strategy.
Consider production or income sources that are not generally influenced by the same set of parameters. Perhaps it is as simple as marketing a portion of your existing production through a different “niche” channel. Getting closer or direct marketing to the consumer. If you or a key member of your team does not have a passion for a different enterprise, it will not likely thrive. Take a good look at your assets and your strengths including potential markets and look for a good fit that is interesting to you. It may not even be a traditional production ag enterprise. I have seen success in things like farm tours for kids, agri-tourism, restaurants, equipment sales, and hunting lodges. What is critical is that you evaluate your resources such as land, facilities, equipment, location, capital, personnel, and market opportunities and find a good match. It is also a good idea to consider how it will fit with your existing enterprises. Will my key resources be available when crunch time is here for my “new” enterprise?
Michigan food and agriculture contributes more than $101 billion to the state economy. Michigan agriculture employs 22% of the state’s workforce. Because of the lofty numbers, there is plenty of infrastructures, research, and support available from which we can draw.
Gather up your team and talk about interests and then take a good inventory of what your assets are, what potential markets are available and how something different may complement your operation and reduce risk. You may even find something to shave off a bit of stress.
ABOUT THE AUTHOR
Pete is the marketing manager for Michigan Valley Irrigation, having joined the company in 2016. He was raised on a dairy farm in western New York and graduated from Cornell University with a B.S. in agricultural economics. His entire working career of over 37 years has been involved in agriculture. A farmer helping farmers. When away from Michigan Valley he operates, Joyful Noise Farm, a small livestock and produce farm and spends time with his family.
