Spring 2020 Logan County
Farm Outlook Magazine


Local banker Dave Irwin observes a decade of change
By Nila Smith

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[March 21, 2020]  To be In the spring of 2010, Lincoln Daily News published its first Spring Farm Outlook Magazine. In that first edition, LDN included an interview with David Irwin, Vice-president and Farm Manager for the State Bank of Lincoln.

Now a decade later, LDN went back to talk with Irwin about what has changed and what has stayed the same in the agricultural industry.

Irwin has been involved with farming his entire life, growing up on the farm and working alongside family members to raise crops, he has insight from being a farmer perspective as well as being a lender. As a farm manager for SBL, he also has one-on-one contact with farm tenants and is involved in the decision making process for the SBL acreage.

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 the season.

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 field.

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 operating loan.

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 community.


Read all the articles in our new
2020 Spring Farm Outlook Magazine

Introduction Farm Outlook spring 2020 4
Local banker Dave Irwin observes a decade of change 7
Farming is one of the highest tech industries in the world! 13
Trump Bucks, Trade Deals and what may be ahead 18
Illinois specialty crops in the 2019 season 21
WOMEN IN AG:  An interview with Skye Kretzinger 28
WOMEN IN AG:  Passion leads this young trio at Central Illinois Ag 32
WOMEN IN AG:  Women in farming 37
Johns and Susan Adams from Atlanta selected as 2020 Master Farmers 40
NWS:  No repeat oif last year's disastrous weather in the 2020 long-range forecast 43
Logan County 2019 soybean estimate gets a 'no report' 45
2019 corn and soybean yields 48


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