Rotational Grazing Trial

I have been conducting an extremely small and unscientific rotational grazing experiment with some of our cattle starting last summer and continuing this spring. I posted a couple pictures on my "Farmblr" Tumblr page.

The semi-grassy paddock in the immediate foreground of the pictures is about 0.60 acre. Last year I threw up a single strand of electric fence that cuts the piece almost perfectly in half. Most of the time it even keeps the cows on the correct side!

The cattle had access to the right half for two days and the left for three days. I wanted two days on each side for comparison purposes, but I didn't have time to rearrange fencing Sunday morning so I waited until Monday morning. (I did say unscientific, right?)

The most noticeable thing from the pictures is the coloration change. After grazing, the grass lightens and almost yellows a bit as the cattle have bitten off the leafy green tops.

What surprised me most between the two pictures is that after a couple days of rest the right half was much greener than I expected it to be. Maybe the overcast weather affected the lighting some, but I expected both halves to look very similar at that point and that it would take a week or more to start to see regrowth.

Harder to see in the pictures, but noticeable in person, was the height difference in the top picture between grazed and ungrazed sides. Also, in the bottom picture there was small height difference--left side being just shorter than the right side. An extra day of grazing on the left, time for a little regrowth for the right side, weather... lots of variables.

There are many changes or improvements to make this paddock rotation more productive in the future. As is, it's not large enough to be a significant feed source, but after a lot of time spent reading up on the topic it is encouraging to see even tiny results with my own eyes.

The cattle enjoy being on the grass instead of the dirt lot, but without having hundreds of acres of pasture to constantly rotate through we will always have some dirt.

We are trying to add a few more acres of pasture space here on the farm, but I've had some misadventures trying to get seed to take and I need to get fence built before I let cows out there. We also have some pretty young calves right now and their curiosity combined with my lack of fence building experience makes me nervous.

Takeaways For The Future

Based on what I've read about controlled grazing or management intensive grazing (MIG), a harvest and rest rotation can produce incredible forage yields and much more feed than traditional continuous grazing or hay making alone.

In a perfect world, I would love to secure land and develop pasture to expand my knowledge and use of MIG. It's my personal opinion that a well executed grazing program could even justify paying a cash rent equivalent of what a row crop farmer pays to raise corn and soybeans here in northwest Iowa.

That doesn't mean we should cease cash crop production, but it could be an additional profit center and diversification to a farm operation.

It's my dream to someday sell beef born, raised, and butchered right here in Pocahontas County, Iowa. With an extremely productive grazing program, a person might even be able to offer that beef without a super inflated price tag that you sometimes see from local or niche marketed products.

But for now, we'll take small steps, do more trial and error with hopes of decreasing our feed costs and giving our cattle some comfortable space to be cows... or bulls!

A Fair Tax Take

My Fair Tax Read and Response

Representative Kevin Yoder, wrote a post on Medium supporting the Fair Tax. You can read it here: Why Now Is the Time to Try the Fair Tax

My questions to Rep. Yoder should be attached at the bottom of his original post, but can also be found here: Okay… But What is It?

Cut To The Chase

I'm not necessarily opposed to the idea of a consumption tax. But I am extremely skeptical that a consumption tax can achieve all of the positives as billed without any of the negatives of the current system(s).

It seems that the biggest argument in favor of a "fair tax" is the barring the doors to the IRS. SPOILER ALERT: Regardless of what your tax system looks like, there will still be at least one government agency in charge of enforcing the collection of tax revenue.

Ok Then Smarty, What's YOUR Idea?

Instead of just sitting at my keyboard and hating everyone else's ideas, I want to subject myself to the ridicule of a mouthy, smart aleck blogger. So here are four areas of the tax code that should be stricken permanently for tax years beginning 2015 and beyond. I had personal experience with each of these tax provisions as a professional tax preparer earlier in my career.

The first two items are temporary differences that would, over the long term, result in zero net change to taxable income. The second two items are permanent differences that reduce taxable income that only certain types of business are allowed to utilize.

• Section 168(k): Bonus depreciation.
  
• Section 179: Election to expense certain depreciable business assets.
  
• Section 199: Income attributable to domestic production activities. Often called the Domestic Manufacturing Deduction (DMD) or Domestic Production Activities Deduction (DPAD)
  
• Section 992: Requirements of a domestic international sales corporation. Dealing with IC-DISC entities and the tax rate reduction for domestic entities with international export sales.

Will some businesses pay a higher tax liability year over year? Yes, likely.

Will it matter to them in the long term? Nope.

Can you hear the lobbyist screams? Oh, but what about THE JOBS? THE JOOOOOOOOOBS?

I'm agnostic to the notion that these tax provisions ever "created" jobs in the first place. No one knows or can know how many jobs were "created" by bonus depreciation.

If you're a business owner saying that you'll be forced to lay off workers from your export company if your ordinary income can't be shifted into preferential dividend tax rates, I say to you, "look you can't be serious, man, you CANNOT be SERIOUS!"

Four steps to making the existing tax code and business tax return preparation less complex without decreasing Federal tax revenues.

He Said He Understood Farm Life

“My wife’s dad used to farm, so I know exactly what you mean.”

His words echoed in my ears while snapshots flashed before my eyes.

I’m in a dusty grain bin “helping” Grandpa. He leans on a push broom watching the sweep auger and I play with a grain scoop that’s taller than me. The bushels fall one by one from the auger into a straight truck. Grandma’s Grand Marquis pulls into the yard. She rolls down the window and hands us cans of ice cold Pepsi and fresh-from-the-oven chocolate chip cookies.

The auctioneer drops the gavel and I lead my first 4-H steer out of the ring. I remove his halter for the last time and two men chase him up the loading chute. Through the side of the trailer, I see his black and white speckled face and the notch on his nose formed by the rope halter. A lump grows in my throat and I sit alone in my dad’s pick up truck with tears streaming down my face.

It’s years before I would ever drive a car, but my hands grip the steering wheel of John Deere 4640. Dad is describing how to gauge the distance between the front tire and the already tilled ground on my right. I’m supposed to visualize where the tire is heading, without staring directly at the tractor tire. I have no idea what he is talking about as evidenced by the crooked black path drawn in the corn stalks behind me.

A cow purposefully licks her brand new baby. He fights to stand, stimulated by her strong rough tongue. His back legs lift his butt up in the air and then he falls over. One leg at a time he finally finds balance. The cow noses and licks encouragement into his backside as the bull calf finds milk for the first time. His tail wags and his whole body shivers with warmth.

The tractor crawls forward, the chain tightens, and the Kenworth hauling a loaded grain trailer finally finds some traction. The two engine train climbs out of the muddy field until changing angles allow slack in the chain. With a loud pop, the heavy log chain curls through the air like a Garter snake discharged by a riding lawn mower.

I walk into the barn and notice a trail in the dirt. It starts in the corner pen, goes under a gate, around the squeeze chute, and out the barn door. Not every baby calf lives long enough to earn an ear tag. And the shallow furrow signals the end of a fourteen year-old cow’s career. Even though she’s slow and tired, it will be tough to watch her walk onto the trailer.

There are warm spring rains, sticky summer nights, and crisp harvest mornings. Dark brown mud splattered on quarter panels and lawns painted white with gravel road dust. There are grocery sacks of sweet corn and ice cream buckets of green beans.

There are fog days, dog days, and skunks that just won’t flee. We have driveways called lanes, sideways rains, and a great white combine we hope to never see.

There are times you want to liquidate and minimum wage sounds like a raise, followed by days you wouldn’t leave home for ten million dollars.

The man’s words echoed again, "my wife’s dad used to farm, so I know exactly what you mean.”

Pardon me for not believing him.

Farm Bill Complexity: Complete fARCe or Cluster PLuC

I've spent the better part of a day studying and trying to understand the latest Farm Bill. Learning the differences between PLC and ARC. There are two sides to my thinking as I dig into this convoluted monstrosity:

1. If I can crack the code and figure out the nuances of these programs, I can gain a huge advantage over competing cash renters. In turn, I could parlay that opportunity into significant profits. I can really benefit from this.
   
2. Why does such a simple and honest goal require such a complicated package? Who could possibly participate in this and sleep soundly in the confidence of their enrollment decision?

The first farm bill was intended to provide certainty for a nation's food supply and a safety net for it's most vulnerable producers. At least that's the idea we'd all like to believe.

Corn harvest in Iowa - October 2014

More, More, MOAR!

Every farmer wants more.

More bushels, more acres, more pounds, more gain per day.

More deductions, more pre-payments, more Section 179, more 0% financing.

More trait stacks, more disease resistance, more drought tolerance, more chemicals crop protection.

More storage, more $B $G $F $W, more precision, more data.

But does any of it guarantee more profit, more bottom line?

The advertisements want to help you get more of what THEY are measuring, but does that make YOUR business better?

What if the program for more bushels per acre meant less profit per acre?

What if the requirements for more pounds per calf meant less profit per cow?

Know what you're measuring and why.

Increasing An Average

Grain farmers: Do you put more focus on tweaking/optimizing highest yielding fields or improving your lowest? Why? #AgChat
— Kristopher Hauswirth (@kfhauswirth) December 1, 2014

Ways To Increase An Average

• Push the highest outlier even farther out, into the long tail.
• Pull the lowest outlier in, towards the fat part of the curve.
• Nudge most or all of the instances a little step higher.

Which option provides the greatest benefit?

What does each option cost?

Do you even have enough information to know?

Because math is fun!

It’s Okay, I Need The Deduction

It's that time of year again.

No, not Thanksgiving. Not Christmas shopping.

If you're a business owner, especially a farmer, you're staring into the face of one full month of "Year-End Tax Deduction" season, specifically my inanimate arch nemesis: Section 179.

Many well meaning sales people and tax advisors will suggest making purchases this December to take advantage of Section 179, calling it wise tax planning. It certainly can be useful under the right circumstances. But remember that even in a best case scenario, accelerated depreciation is only a tax deferral tool. It is never a tax avoidance mechanism.

Bring Me What You Have

“What do you have,” he asked?

“Not enough,” they answered. “Nothing compared to what it will require.”

“No, listen carefully,” he said calmly. “I’m not asking if you have enough. Just bring me what you have. Set it down right here,” pointing to the ground by his feet.

“Bring me what you have; lay it down," he repeated.

“Now here, take what I give you. This will be enough,” he assured them.

[Read four accounts of the whole story here, here, here, and here]

Arbiter of Violence

Ray Rice, Adrian Peterson, and Anthony Schlegel.

You are probably familiar with the first two names and recall some recent news headlines. Mr. Schlegel, if you haven't already seen or heard, is an Ohio State University strength and conditioning coach now best known for his body slam technique.

As I watch the photo and video of Schlegel tackling the unruly spectator circle through the social media cycle, I can't get this question out of my mind:

Who gets to decide when violence is accepted and when it is abhorred?

What facts can help us determine when something is awesome versus when it is awful?

Are there aspects of the offender or victim in the incident that are relevant, like skin color or gender?

Does the apparent ability of a grown man to take a punch, so to speak, negate the offensiveness of the violent act?

Do not misconstrue. I'm not defending Rice or Peterson. Furthermore, I think the guy running on the field got exactly what was coming to him. I think he deserved every pound of force in that body slam and every blade of field turf in his face.

It feels like one of these three situations is okay and the other two are not, but it bothers me that I cannot explain why that is.

Insurance Quote

I met with a life insurance salesman a few weeks back. During the course of the meeting he matter-of-factly defended a certain mutual fund as a no brainer, easy money investment and said, "that fund did 18% last year, now where you gonna put your money that can beat that?"