Now with SBL for 17 years,
Irwin previously worked for a time for local farm equipment dealer
Central Illinois Ag.
Drawing from all that experience, Irwin can identify one of the
biggest changes in the farming industry: the use of technology. In
2003, while working at CIA, the electronic yield monitor installed
in combines was the big innovation. Though it would be considered
clunky compared to today’s technology, the yield monitor was a big
deal in 2003. It gave producers on the fly insight as to how well a
particular field was doing. If the farmer had his information all
written down, he could identify what field he was in, what variety
of corn he had planted and could figure out what parts of the field
were yielding better than others.
Fast forward 10 years, with the push of a button, all that stuff in
his head is now visible on the computer while riding in the combine
cab, and the data being collected is sent to software that will
allow the producer to analyze the field outcomes in the comfort of
his home office.
Irwin said that record keeping is much more finite today thanks to
technology, and farmers are studying and learning how to profit from
all the new technology available to them. It isn’t a simple task to
learn it all and put it all to good use, but those who are doing so
are seeing the benefits.
Technology has also relieved a lot of the physical work of farming
and improved farming efficiency. Irwin talked about the
self-steering technology and said there are many advantages to this
technology. For example, during planting season, Irwin noted that we
seldom see crooked rows in the field. It is because that guidance
system within the tractor is much more precise behind the wheel than
human hands and eyes. Back in the day, the operator would set his
sights on a mark at the far end of the field and drive to it. A
distraction in the cab could cause him to veer off mark for a period
of time. Also, the goal of keeping the field straight put a strain
on the operator physically with the challenges of keeping mental and
visual focus, to man handling the steering wheel on rough ground,
the job was much more tiring than one would expect. Today’s
self-steer technology relieves a lot of that pressure and strain and
makes it possible for operators to do their job better.
Irwin added this technology is also an advantage for the
multi-generational farms where son, dad and grandad may all be
behind the wheel. For the son just getting started out, it makes the
task easier and he does a better job. For grandad, it makes the task
easier and he does a better job as well. And for dad, perhaps the
best part is it helps relieve the worry about the younger and older
components in the family.
And, when granddad reaches the point that he needs to stay home, he
can still be in the loop in real-time. Irwin said that today it is
not unthinkable that grandad can be at home in the easy chair
watching the field progress through data being collected and
transmitted to a laptop, note pad, or even a phone.
In the office, the producer can look at all the data collected and
understand what varieties did the best on what fields, where the
weak spots are in a field, and how weather conditions may have
impacted a field with wind or water damage from storms throughout
Drone technology is also popular on the farm. Irwin noted that on
one of the SBL farms, he paid a visit to the tenant after a storm.
The crop looked okay from the side of the field, but they needed to
know what had happened deeper in. With a drone they had flown a
camera over the field and there was substantial damage inside the
From a lender perspective, Irwin said that the one thing that
remains the same is that the banker wants to see that balance sheet
and he wants it to show promise. The tools the producer has at hand
to examine his yields and productivity don’t necessarily add to the
balance sheet directly, but indirectly, when the farm is more
efficient it does show on the balance sheet with better returns.
The 2010 Farm Outlook magazine looked at the past farm season. In
2009, farmers had encountered water and a lot of it. Rains had
hindered harvest tremendously and many were still trying to bring in
crops when winter arrived in Logan County. Ironically, in 2019
farmers encountered water and a lot of it at the beginning of the
season and hindered planting, it had the same impact in many areas.
The 2019 harvest was spread
out, some areas were harvested almost on time, while in other areas
harvest had to be delayed because planting had been delayed and
crops were not mature at their normal time of year.
Both the 2009 and the 2019 scenarios impacted yields and also
impacted the cost of harvest.
In 2010, Irwin said that the best the producer could hope for was
that there would be some good years to counter balance the bad one.
In 2020 Irwin looked back on those 10 years and said that there had
been plenty of ups and downs including wet and also drought, but
there had been a big boon for the producer in the early years
following 2009. With the poor yields of 2009, grain prices soared.
There is a cycle within
farming between grain prices and costs of inputs (seed fertilizer,
chemical, etc.) The value of inputs go up when grain goes up, but it
is after the fact. It takes a while for everything to balance out,
and in that time, farming becomes quite profitable. There is also a
flip side to that coin, when the grain prices drop and the input
costs are still high, the farm profitability shrinks substantially.
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However, farmers did reap the
benefit of that cycle in the seasons immediately following 2009 and
many were able to recover from that bad harvest.
As a lender, Irwin said that there are basically three farm loans;
land, equipment, and operating.
Reviewing what he has seen recently, Irwin said there is farm ground
out there for sale, and the price ranges are wide. He noted farm
sales he has attended where the ground went for $8,100 to $8,400 per
acre. At another sale, he saw the ground bring $12,100 per acre.
He said the primary difference was that the lower cost land was what
the farmer would consider “rough.” It was good soil, but perhaps it
had fewer straight edges, had large drainage ditches or other rough
terrain that would make it harder to farm and more time consuming
for the tractor and combine.
The higher priced land was more attractive. The field was flat,
lines straight and there were no barriers to farm around. Irwin said
all were good soil with the ability to yield well. The difference in
desirability came from the differences in the terrain. Irwin said
that middle of the road farms, neither rough nor pristine, are going
for around $10,000 an acre. He added that it appears to him at least
that the middle of the road farm ground is what is more readily
available in Logan County. The pristine acres are not as plentiful
as they once were.
Equipment costs have soared over the last decade. In 2010 a good
combine, perhaps not the Cadillac, but more than capable of doing
the job would go for $200,000 to $250,000 new. Today, double that.
Even though the price has doubled, Irwin said most equipment notes
are written for four to five years, not a whole lot different than
purchasing a family vehicle.
Operating loans are much more complicated because a producer in the
fall is more often than not in the combine harvesting while talking
to vendors about next years’ input purchases. Early buying gets
better pricing on fertilizer, chemical and even seed. But that means
that next year’s input are being bought this year, and eventually
all that needs to be sorted out on the balance sheet and in the
Playing much to the favor of producer right now is the fact that
interest rates are at all-time lows. Irwin said that the prime
dropped a half point the first of March, something that is unheard
of. He added that the drop in interest rates is connected to the
coronavirus. This is a knee-jerk reaction to what is going on around
the world, that the everyday person would not imagine could have an
impact on farming, but it does. The challenge for the producer
though, is to know how to use this to their benefit without also
over reacting. Keeping in mind that eventually this virus will
subside, and probably some new issue will arise to replace it.
Farmers need to be practical. Take advantage of what is before them,
but look ahead to what comes in the years ahead. Over extending now
because interest rates are low may come back to bite them later.
Irwin says that farmers have to be sharp, they have to be good
record keepers and they have to be able to keep a lot of balls in
the air at the same time. Not a job for the weak of mind or heart.
Now 17 years into his position with SBL, Irwin says he is happy to
be a big part of the farming industry. He enjoys what he does and he
enjoys helping local farms survive and thrive in today’s challenging
economies. He appreciates SBL’s 117 year commitment to Logan County
and he very much appreciates the farm industry in Logan County. He
looks forward to working with his customers and helping them to
realize their full potential on the farm year in and year out.
There have been a lot of changes in the farming industry in the last
10 years and there will undoubtedly be a lot in the next 10 years.
LDN looks forward to seeing what happens in 2030 and perhaps looking
back once again at what the 2020 decade brought to our farming