October 11, 2016
Lincoln, Neb. — Researchers from the University of Nebraska–Lincoln have been awarded a one-year, $443,561 grant from the National Institute of Food and Agriculture focused on improving long-term profitability and producer risk management decisions by developing farm financial analysis while also contributing to the National Farm Financial Benchmarking Database.
“Access to benchmarking data is vital to farmers and ranchers who are working to control costs and improve profitability. This is especially important in the current economic environment,” said Cory Walters, assistant professor in the Department of Agricultural Economics and the principal investigator on the project. “Identifying financial position is a requirement to make an informed management decision, very likely leading to improved profitability and greater chance of farm success.”
Walters, along with Simanti Banerjee and Brad Lubben, assistant professors in the Department of Agricultural Economics at UNL, will partner with farm business management programs from five states, including Nebraska, to expand collaborative partnerships with producer associations to improve the farm management knowledge skills of producers and to increase data sharing for the national database. Farm business management programs participating are:
- Nebraska Farm Business, Inc.
- North Dakota Farm Business Management Education Program
- South Dakota Center for Farm/Ranch Management at the Mitchell Technical Institute
- Utah Center for Farm Business Management at Snow College
- Fox Valley Farm Management Association in Wisconsin.
Operations can benefit from benchmarking data because they can identify opportunities to save money, increase return on investment and identify enterprises making and losing money. However, participating in a farm financial analysis requires a significant effort by the producer to provide necessary documentation needed to produce a quality financial analysis.
According to Tina Barrett, Nebraska Farm Business, Inc., this hard work pays off by giving producers information to make sound management decisions from a place of knowledge, not just experience.
“Producers face unique situations so it is important that operations know their own financial situation, not working off of averages,” Barrett said.
The participating farm business management programs currently work with over 1,600 farms and are committed to expanding their organizations. The collaborating partners will work to increase the number of farms, specifically small- and medium- sized farms to contribute their data.
“Farm financial analysis provides the building blocks to help farms and ranches compete with more efficient operations,” said Walters.
Nebraska Farm Business, Inc. will work to increase awareness of its programming in Nebraska by working with lenders and educators from Nebraska Extension to promote the benefits of participation in a financial management program. Beginning producers new to the program receive a discounted analysis.
University researchers will develop a research program focusing on improving producer profitability and risk management decision-making by relating farm-specific risk, risk management tools, risk preference and farm financial standing.
This project is a continuation of a partnership between the five farm business management associations and UNL.
To learn more about this project or how to participate in a farm business management program, contact Walters at 402-472-0366 or (email@example.com)Contact:
Department of Agricultural Economics