OFI 1010: Diversification As A Hedge And Using Equipment You Already Own To Create Off-Farm Income

SHOW NOTES:  Today we get to profile a very innovative and hard-working farmer.  At the same time, we get to tell a story that we have told before, and we get to show you a great model for creating a sustainable farm as well as creating off-farm income. Allen Deutz is the owner of a farm purchased by his great-grandfather in 1920 in southwestern Minnesota. In just one more year this will be a century farm.  Like so many generational farmers Allen was faced with creating a business model that would allow him to continue to farm the property and have it available for the next generation. Allen first tried the dairy business, as his father had operated this farm as dairy.  However, even as he was excelling in his performance as a dairy farmer, the economics of the dairy industry pushed him right out at his small scale.  So, Allen transitioned to raising some commodities - corn and soybeans, raising grass-fed beef, raising all-natural pork, and raising free-range meat chickens.  It is in this diversity that Allen has been able to create a system that is regenerative and hedges against low prices in any one area. Allen recently purchased a no-till drill for planting on his own property.  He realized two things.  First, when he was not planting that piece of equipment was just sitting there, not making any money.  Second, because of the wet spring, his region had been having many farmers who had not been able to plant and could use his help planting in cover crops for the rest of the season.  Thus, a form of off-farm income was born. ADVICE FROM ALLEN: PRIDE OF OWNERSHIP: Allen suggests that you do not borrow money to buy equipment just so you can own it.  Research whether or not it makes you money to own the equipment vs. hiring the work done or renting the equipment. EASY: Renting is easy, and if you do this for a season it can help you figure out whether or not purchasing the same equipment makes sense. PERSONAL HABIT:  Allen is very good about penciling out expenses and whether or not he is making money on any given aspect of his farm.  This has led him to another form of off-farm income in the off-season where he does this for other farmers.   CONTACT INFORMATION: Website: LINK Facebook: LINK Email: [email protected]