Each year the profitability of the farm or ranch is challenged by conditions that negatively impact revenue and increase expenses.
Currently, we continue to experience drought conditions across the Northern Plains. Before that, it was in California and the Southern Plains. Also, depending on which side of the fence you stand on, some commodity prices are below the cost of production.
Using an analogy from rangeland management, producers who build resilience into their agricultural operation are positioned to lessen the risk that environment, climate, markets, and finances place on profitability.
Resilience is defined as the capacity to recover quickly from difficulties; toughness.
The term “resilience” fits well when assessing the current state of a ranching operation, as well as a guide for future management decisions. As we end the 2017 production year and plan for 2018, there are a number of obstacles likely to affect a ranch’s profitability.
The largest obstacle to test the resilience of an operation is the current condition of its land resource due to the lack of rainfall. Producers need to critically assess their current drought management plan. Make sure all trigger dates are in place and that the action plans connected to those dates are realistic and appropriate.
If you don’t have a drought management plan, get one! How? There are a number of local resources that will provide real life, up-to-date examples and templates of drought plans suited to your region. Your local extension office is a good place to start.
As you develop your drought management plan, remember to solicit input from family and financial stakeholders. Once a draft is completed provide a copy and explain the action plans to all involved. When climate conditions change, modify your plan accordingly. — Dave Ollila, South Dakota State University Extension sheep field specialist and Newell sheep and cattle producer
