Acres & Assets | Part 2: Farming in the 2000s: Technological Advances and Changing Demands

In the previous article I chronicled the 1960’s through to Y2K with insights into what was happening in production agriculture in the grain belt during that time and thoughts into what made a good farmer through the ups and downs.  Now we are ready to jump into the 2000’s and the momentous changes in farming and for farmers.

Three monumental events came together in the early years of the new century to propel corn and soybean production, grain prices, and the value of farmland to new higher levels.  The two events that boosted grain markets higher were the expansion of ethanol usage and the almost insatiable appetite of China for soybeans.  The twin demand game changers created the need for more bushels of both and a competition for additional acres of each crop.  This jumped grain prices and farm incomes higher for a number of years coming to a peak in 2013.

The other event that has changed production ag started in the 1990’s and has accelerated ever since.  The introduction of more and more technology of all kinds into how farming is being done has changed much for farmers.  This technology includes biotech developments in seeds that greatly enhance productivity of the crop.  Technology has grown in gathering and analyzing data on the farm.  Equipment is becoming more complex and larger.  Automation and guidance systems are quickly gaining widespread use.  Almost every week there is a new technological application for production agriculture being introduced.

Farmers became students of the various new technologies and were fast adopters of the ones that made them more efficient and more profitable whether the technology was in the seed, from a satellite, part of their equipment, or in their offices.  Good farmers in the neighborhood might not have always been the first adopters of the latest and greatest, but would make changes when it made economic and operational sense.

During this period I transitioned out of farming and into professional farm management.  I worked for non-operating landowners to handle the leasing of the farm to a tenant, grain sales, payment of bills, managing care of the farm, and about anything else the owner need with respect to their farm asset.  The work provided me with experience into the transition of family farms to the next generation and the various ways that it can go well or not so well.  

Over the past few years farmers have been faced with additional changes coming in agriculture beyond the usual challenges of weather, markets, and profitability.  A new factor to understand and respond to is the awareness of sustainability and what it means for producing crops.  This arena includes how to handle the potential of carbon credit markets and how it may impact the way a farmer farms.  The importance of soil health is gaining importance with many different means of improving the quality of this foundational resource.   The use of cover crops and the changing of production practices are being explored by farmers and landowners.  Cover crops are not a new thing as I experimented with several types in the 1980’s and 90’s. 

Management of a farming operation is growing vastly more complex than even a few years ago.  Today’s farmers are working with different leasing arrangements such as flexible cash rents with non-operating landowners who are gradually getting less familiar with production agriculture.  Farmers are faced with financing increasing costs of production and higher priced equipment.  And finding qualified labor to operate the sophisticated equipment of today is becoming a challenge.  

Today’s farmer is wearing more hats than ever being a CEO, tech administrator, negotiator, social media user, sustainability adopter, and overall coordinator of a multi-faceted big business.  Good farmers in the neighborhood still have above average strong crop yields, keep their farmstead neat, maintain the landowner’s farms as their own, are timely in their operations, and are financially stable.  But now farmers have to be proficient at much more in order to be successful no matter if they farm hundreds of acres or thousands.

For the non-operating landowner, having a good tenant makes the owner money whatever the type of leasing arrangement.  Having a strong farm operator who fairly shares the profit generated by the farm each year and maintains and improves the farm over the years is a critical management piece for the owner.  Owning a farm is a long-term investment and the relationship with a good tenant is one of the keys to owning a successful farm now and for the future.

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About the Author

Randy Dickhut has a fifty-year career in agriculture, combining production and professional farm management experience that has given him unique insight into owning and operating a farm. Starting in the 1970s, Randy actively farmed for thirty years in western Illinois, expanding the family operation to over 1,600 acres with twenty landowners before leaving in 2002. During his tenure, Randy embraced innovative practices like no-till and cover crops while maintaining communication with landowners and writing a quarterly newsletter. In 2002, he joined Farmers National Company for a twenty-year career, managing farms for non-operating landowners, obtaining the Accredited Farm Manager designation, and eventually serving as the Senior Vice President of Real Estate Operations, overseeing significant land sales nationwide. Throughout his career, Randy has worked closely with landowners, investors, and farmers, gaining firsthand knowledge of regional production and operational differences. He is also a prolific writer, contributing hundreds of articles to various agricultural publications and programs.