3 minute read
Message from the ICA Treasurer
Are we just ‘getting by’?
Sharpening your pencil may be the key component to staying in business for another year.
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BY CODY HENDRIX ICA Treasurer
If anything can be said for the weather this fall, it’s been lack of consistency. It started hot and dry and then turned very cold with snow right at the annual convention. It feels like that’s the same story for the world we live in. The lack of consistency in obtaining supplies needed for our business, or the price of those supplies has been hard to keep a handle on. The markets have been tough too, with more volatile reactions to what would normally be considered small triggers.
The cost of doing business has increased tenfold with the price of fuel more than double a year ago, the cost of interest feeling almost that much higher as well. The price of hay and fertilizer have followed almost as strong, and labor probably would if you could find somebody to show up to work every day. Unfortunately, the price of calves hasn’t increased by the same amount, although I would hope that all producers are selling their cattle for more now than they did a year ago.
When looking at the ranches throughout Idaho the main consistency that I see, is that our people in the industry are still the same. We still have the same great ranchers that we always have. There are pockets around the state where some land ownership has changed but by and large we are still working with the same sales teams for our supplies, the same buyers for our calves, and the same people are still producing beef. And the reason we are still the ones producing beef is because we have been good managers of our business over time.
I had a conversation last week that started with the comment “it feels like we have the perfect storm in the ranching industry right now. We have a drought, inputs are higher, feed is expensive, we have less cows on the ranch, and our calves are not bringing enough to make the ends meet.” I’ve thought about this, and especially in relation to the people that are managing the ranches we live on. We have been through tough years before. And we have all done what it takes to get through.
The difference is that most of those times were because of low calf prices, not high calf prices. It would be easy to sit back and look at a calf check that is bigger than last year and think “this is going to be a good year”. But that complacency is what can make a ranch go broke. This is the time to really ‘sharpen the pencil’ and prepare for the upcoming year. We don’t have control over how much snow we will get, but we do have control over how much time we spend to plan and prepare for the upcoming year. We can double check budgets and do inventory of what’s left from last year. Some of us might have to tighten the belt a little and wait a while for our next vacation. But it’s worth it to stay in business another year.
None of us can control how much snow we will get this winter, or what happens in our supply chains. But we can control what happens on the ranch. I set a challenge to each of us to start looking at our budgets for the upcoming year and determine what we need to keep our operation running smooth.
