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[00:00:08] Mike Howell: The Dirt with me, Mike Howell, an eKonomics podcast where I present the down and dirty agronomic science to help grow crops and bottom lines. Inspired by eKonomics.com, farming’s go-to informational resource, I’m here to break down the latest crop nutrition research, news and issues, helping farmers make better business decisions through actionable insights. Let’s dig in.
Well, hello again, everyone. Welcome back to The Dirt. We’re back with Ryan Christensen again this week. We were on location last week and we’re gonna kinda continue that conversation this week. Ryan, welcome back. And if you will, just remind everybody a little bit about who you are and where you’re located, what you do here.
[00:00:55] Ryan Christensen: Yeah, I’m a fifth generation farmer. My farm name is BKR Farms. I farm with my dad and brother, Bart and Kyle. And we’re located in Grace, Idaho, which is a small little farming community on the southeast corner of the state, just north of the Utah, Idaho border. And we’ve been growing potatoes since the mid seventies, but we’ve been growing small grains since the late 1800s.
[00:01:16] Mike Howell: Ryan, I’ve been to Idaho a few times. Once before, but I really got to drive around a little bit this time and really like what I see, really beautiful scenery. And driving in, I was kinda wondering where in the world do they grow all the potatoes? I came over that last mountain and it opened up into this beautiful valley and I’m like, “Wow, I can’t believe you get to see this every morning.” We did have a snow a day or two ago and there’s still snow covering everything, and it’s just beautiful here.
[00:01:39] Ryan Christensen: Thank you. That’s the beautiful part is coming into the valley over the Fish Creek Pass that you came across last night.
[00:01:45] Mike Howell: So Ryan, since we had you cornered here today, I thought we would go ahead and do another episode. We’ve had a great visit and talked about some things that you’re doing here on the farm. And one thing that you pointed out was you don’t pay a lot of attention to yield anymore, you’re more concerned about return on investment.
So I thought we would spend a few minutes today talking about the differences in between yield and return on investment. A lot of people think that farming is all about just making that high yield, doing everything we can to get those yields up. I often hear a lot of terms floating around about yield, things like the high yield or average yield, or even optimum yield. Uh, can you talk a little bit about the importance of yield and give our listeners that may not be as familiar with farming an idea what we mean about some of these terms like high, average, and optimum yields?
[00:02:28] Ryan Christensen: Yeah, grateful for the opportunity to talk about that. It’s one of my favorite things is to optimize your return on investment.
So obviously we gotta have yield. You’ve gotta put a crop in the ground, you gotta take care of it, and you’ve gotta get it to produce the maximum amount you can on the other end.
However, with the rising cost of inputs, and everything’s been going up for years, you’ve got to maximize your profit more than your yield because there’s ways that you can go out and put a huge amount of fertilizer or chemicals on your crop to protect it to get the highest yield possible.
However, by the time you put a pencil to how much nitrogen or how much phosphorus or how much chemicals that’s gonna take, yes, you’ve maximized your yield, but you’ve also burned through your pocketbook. And it doesn’t matter, the bank doesn’t care what your yield number is, they care what money you’re bringing in from that and what money is going out.
And so I don’t necessarily farm for yield anymore because I farm for a return on investment. I look at every field and figure out, okay, this field is just not that good. It can do okay, but putting 100 pounds of nitrogen is not gonna make it any better if I put 50 pounds of nitrogen. But the field up the road, it might do, if I put 150 pounds on, it might do well enough to make up for that extra 100 pounds of nitrogen.
So I’ve really shifted our focus, my brother and I, Kyle, on our farm, of maximizing the return on investment.
In our last episode, we talked about conservation tillage and we talked about some of our practices. The first couple years, there was a minor drop in yield on certain fields. Some fields we didn’t see it, but other fields we did. And when you’re sitting in the combine and you’re seeing that yield monitor telling you how many bushels or how many pounds, it’s easy to get frustrated because it’s a little less.
But then when you put a pencil to it, “Well, I only had to go across that one time in my tractor to plant it. I didn’t have to go across three times. So that saved me five gallons of fuel. I didn’t have to go buy a bunch of digger points or metal that wear out as you’re tilling. And so by the time you put into that, it’s okay that I was five or six bushels less because I wasn’t putting in 10 bushels worth of inputs just to cover fuel and metal costs.”
And so being able to look at the farming landscape in that sense really puts you at ease and knowing that you’re farming for a profit.
Ultimately, that’s what it’s about. Farming is a business. And if it’s ran like a business, you’re going to look at it and do what you can maximize your return on your investment rather than just cranking out the most.
If you look at McDonald’s or any of the burger places, they’re the same way. They price their burgers at what they can do to send the most burgers out the door, but still get a profit. If they wanted to sell the most burgers, every burger would be 50 cents and they would be fine.
[00:05:27] Mike Howell: I would eat a lot more if they were 50 cents, but I probably don’t need to eat anymore.
Ryan, I do a lot more work out east than I do here in the western part of the United States. I’m not as familiar out here. But through the corn belt and in the eastern states, every state it seems has a high yield contest for corn or soybeans or other crops.
And even some of the national organizations have high yield contests. And some guys go out and win those contests every year and they make phenomenal corn yields or soybean yields. And yeah, I see a benefit to that in some things, but one of my issues with some of those is nobody ever talks about how much money it costs to make that bigger yield and are they actually making a profit doing that?
So what you’re saying is that you could double your yields, but actually be losing money doing it.
[00:06:09] Ryan Christensen: Absolutely. I mean, we’ve seen those. Not the state of Idaho, not that I’m aware of has any of those. But being part of the National Wheat Commission and different things, yeah, we get those in the mail all the time.
And to me, it’s kind of like, well, yeah, it’s a fun contest, but to do that on a grand scale would make a farmer go broke really, really quick.
[00:06:29] Mike Howell: So Ryan, we’ve kind of mentioned this return on investment a little bit. Talk a little bit more about what return on investment is and what it means.
We know that it’s a really important number, but why is that more important than the actual yield?
[00:06:41] Ryan Christensen: Well, like I said in the beginning, the return on investment’s more important because it’s what keeps your business going forward. It’s what gives you a profit.
So return on investment is, for every dollar I’m going to invest into my farm or into your company, or even to yourself as an individual, what am I going to get out of it in return?
An example I would give is if I have stripe rust, that’s very common in the Midwest, but sometimes we get it here in our wheat and I’ll go out and scout it.
And then I’ll call my local chemical rep and say, “Okay, how much will it cost me to treat this for stripe rust?” And he’ll say, “Well, the chemical’s about $10 an acre and you’re going to have to fly it on with a crop duster that’s about $10 an acre, so that’s $20.”
And so then I say, “Okay, price of wheat this year is only $4. Am I really going to get a five bushel bump, which on dry land, that’s 10%? On irrigated, that’s more like three or four percent?”
And then we can look at the numbers that we scout and be like, “Hmm, I’m not really sure I’ll get a five bushel bump, so let’s not do it.”
Now, the very next year, we could have stripe rust and grain might be worth $9 and be like, “Well, I can get a two bushel bump, so let’s go ahead and spray for stripe rust and take care of that pest so that we can get the two bushel bump.” And so that’s how I look at it on all my crops.
That’s just a real simple one to look at is, am I going to get, the dollar spent, is it going to give me the yield that I need to cover not only the cost of the chemical, but enough to merit that cost?
[00:08:16] Mike Howell: Ryan, you talked about the conservation tillage and how that’s helping improve your ROI. You talked about the savings of going across the field and investing in the steel that’s just gonna wear out.
Are there other things that you’re doing here on the farm that you think, some practices, that are increasing your ROI?
[00:08:31] Ryan Christensen: Changing up the way I fertilize. So when I fertilize, how I fertilize, what I fertilize with.
I use different fertilizers. I use more of like a polymer coated urea on my potatoes and I do it upfront so that it’s more of a slow release throughout the season. It’s more expensive. You’re looking, in our valley, 20 to 30% more, but I easily make that back on potatoes.
And when I’ve done that on our small grains in this area, it doesn’t pencil out. It doesn’t give us that 20 to 30% bump. So I use a cheaper source on certain grains and different timings. That’s another way I look at return on investment.
With the water savings, the water’s not free. I’m either paying a power bill to pull it up out of the ground or I’m paying a power bill to pull it out of the canal, the irrigation canals.
And so by reducing that, some systems are 20 to 30% reduction in power savings because of being able to save and conserve water. And so those are probably the two biggest that we’ve seen.
[00:09:30] Mike Howell: Ryan, some of these ROI calculations are pretty simple.
You know how much the input’s gonna cost, you know pretty much what your yield advantage is gonna be, and you can figure that number pretty easy. Sometimes it gets a lot harder.
If you’re looking at multiple inputs at the same time, one plus one may equal three or one plus one may equal zero. How do you figure your ROI in some of these more complicated systems, and how do you account for things like quality of life and time savings and being able to spend more time with the family and things like that?
[00:09:58] Ryan Christensen: To answer the first question of the complexities of the different inputs, I use computer software that links in with my different GPS systems, gathering data.
I believe that if you can’t measure it, you can’t fix it. And so the different softwares that I use and bring all the information in from like John Deere Ops Center, or Climate Fieldview, or different things like that, and then it’s able to layer it and give me like a zone economics so I can see what my return on investment is based on all of my inputs instead of just one. So using technology, using softwares out there is very important to take the complexity out of that.
The second thing, the value of time with spending with family, spending time with family is very, very important to me. And without the sacrifice of my wife and children, I wouldn’t be able to do what I do on the farm. And so I want to spend as much time with them as I can, but obviously farming is very time heavy for a majority of the year.
And so we invest in a lot of things that some may on the outside look like, “Well, that’s kind of useless or wasteful.” For example, all of my irrigation systems I can control on my phone. It was very expensive to put those systems on. But prior to that, I’d get up at 5:30 and I’d have to get in my truck and spend an hour making a drive around. And if anything was wrong, I’d stop and fix it. And if everything was going, by then it’s like, it’s too late to really go home and have breakfast or anything, so I’ll just stay out to work. Same thing at night. Before coming home, finish work at 6:00 and do that same hour drive.
Now, I can run to Pocatello, to a grocery store with my family, or I can go to a movie and be notified as we’re leaving the movie that something is stopped or something is broke down. Same thing with my tractors. I can send guys out to do work and I can be monitoring them instead of having to drive out and wonder how close they are to finishing.
And so those are things that, yes, it’s expensive and it doesn’t directly affect my ROI to the bank account, but it affects my ROI to my family, which is very important to me.
[00:11:53] Mike Howell: Ryan, you talked about ROI and yield, and how you’re not shooting so much for the highest yield, but you’re looking for the highest ROI. I know a lot of farmers still have to have that high yield and they want to go to the coffee shop and brag about it. How do you deal with your neighbors when you go to the coffee shop or the local cafe and everybody’s bragging about their yields and they may be a little higher yielding than you are?
[00:12:13] Ryan Christensen: Well, in the previous episode, I talked about the hindrance of conservative tillage and getting over that beauty contest mentality. Same thing has to apply to ROI. I just smile and it doesn’t bother me in the least, because my neighbors aren’t paying my bills and I’m not paying theirs. So if that’s what they’re focused on, then that’s theirs, but then I just focus on what I can control and what I can do. And for me personally, it’s between me and my family and I just don’t let it bother me.
[00:12:39] Mike Howell: Ryan, we’ve talked a lot about yield and ROI. Is there anything else we need to talk about before we end this subject and move on to something else?
[00:12:46] Ryan Christensen: I just think it’s important to change that mentality. Everything is changing so rapidly, if not by the day, in the world and world economies. So if we’re not willing to change with it, if we’re only going after yield, those type of farms may not be around if they’re not willing to adapt and to focus on different things other than just high yield.
[00:13:05] Mike Howell: Well, Ryan, once again, we appreciate you taking time out of your day to be with us. Listeners, thank you for tuning in, and if you’ll hang around for just a couple of moments, we’ll be right back with segment two. Farming isn’t farming without questions, and now, there’s a place to go for answers. At eKonomics, an entire team of agronomists is waiting and ready to help for free. No question is too big or too small. Visit Nutrien-eKonomics, with a K, dot com and submit your question with the Ask an Agronomist feature.
[00:13:38] Mike Howell: Well, listeners, welcome back for segment two. As you know, this year, segment two has been devoted to an Ask an Agronomist question. We’re kind of changing that up for this final episode of the year. If you’ve been listening for very long, you know each year we end our season at Thanksgiving and we’ve always done a special Thanksgiving episode.
To kind of continue that tradition, I thought it would be great, since we have Ryan here with us today, to get his perspective on Thanksgiving as a farmer. So Ryan, if you don’t mind, let’s talk a little bit about Thanksgiving. And if you will, just tell us a little bit what Thanksgiving means to you as a farmer.
[00:14:09] Ryan Christensen: Thanksgiving is one of the most important holidays of the year for me outside of Christmas and Easter, because it gives me a chance to really think about what I’ve been blessed with throughout the year. I truly believe that the things that I’m able to accomplish wasn’t because of me, it was because of the giants who came before me, ancestors who left Denmark and other parts of Europe to come here to this valley and break it out of sagebrush. But then also the sacrifices that are made within the walls of my own home that we’re sitting in. You know, the sacrifices that my wife makes, Andrea makes, on a daily basis to kind of be a single mom for several months of the year as I’m planting or I’m harvesting. But then so very grateful for my kids too and their understanding of the different times of the year, and the opportunity that my kids have to come and work with me. Potato harvest especially, my sixteen year old daughter is driving a tractor right alongside me, and that just makes me so grateful. And when we’re done in the field, we still have to go unload those trucks at the storages, and then I get to go and see my other two kids who’ve been standing there in the dust, and the heat, and the cold, and the rain, and still have a smile on their face as they’ve been cleaning the potatoes, pulling the rotten ones out, or the rocks. That’s something that I’m grateful for.
And most thankful for my God and Heavenly Father who’s blessed us with this opportunity to farm and to take stewardship of his creations that he’s given us.
[00:15:29] Mike Howell: You know, Ryan, Thanksgiving is one of my favorite holidays as well. Growing up, I didn’t live really close to my grandparents, and we didn’t get to go see them all that often. But Thanksgiving, everything shut down, and we were going to the grandparents’ house for Thanksgiving, and got a lot of fond memories there. If you don’t mind, take just a few minutes and talk about what Thanksgiving’s like here at the Christensen home. Are there any special traditions, any special foods, any fond memories?
[00:15:52] Ryan Christensen: So growing up, it was a great memory to go visit my grandparents that lived in Utah. That’s where my mom was from. And Christmas was always spent here on the farm, but Thanksgiving was spent visiting my grandparents in Utah, and that was always really special to see those other cousins. And then as we got older, it became just here, you know, as grandparents age and pass away. But then as my wife and I started our family, we kind of split Thanksgiving, one time here in Idaho and one time in Utah, and I’ve always loved it. I’ve loved the stress free time of Thanksgiving, of just being able to do some cooking and then show up and eat is always a great experience.
In recent years, we’ve had the opportunity to travel over Thanksgiving. Because of keeping our kids out of school, you can maximize the days you’re gone if you take some of the school days that they’re out on Thanksgiving. We’ve had Thanksgiving in other parts of the world, and it’s been just as special because we get to show our kids what blessings they have of being where they’ve been able to grow up and to be with and to see. And then even when we get back, we still have our traditional Thanksgiving dinner. Sometimes it’s before and sometimes it’s after, but it always includes the turkey and never without Idaho grown mashed potatoes and gravy.
[00:17:03] Mike Howell: Ryan, that kind of leads me to my next question. How many ways will potatoes be prepared and be on the table Thanksgiving Day?
[00:17:10] Ryan Christensen: Usually Thanksgiving is just once, and that’s just the mashed potatoes. But it’s because the rest of the year, we have them in all sorts of ways. There’s so many ways you can have a potato that I couldn’t even begin to count the ways we’ve ate potatoes in our house.
[00:17:24] Mike Howell: Yep. Well, we eat potatoes pretty regular at my house as well. But growing up, I would not sit down at the table if my mom didn’t have potatoes in some form or some fashion. I’m still that way today.
Ryan, is there anything else you wanna leave our listeners with about Thanksgiving before we wrap this episode up?
[00:17:38] Ryan Christensen: I’m just grateful for your listeners, that these opportunities to listen to podcasts shows us that there’s people out there who are willing to learn about farming and agriculture and how we are trying to just feed the world. And so I’m grateful for your listeners and the opportunity to be on this podcast.
[00:17:54] Mike Howell: Well, Ryan, we really appreciate it. Listeners, as you know, this is our last episode for the season. We’ll be back the first Tuesday in March. Ryan said it, that he was grateful for the listeners. I’m grateful for the listeners as well. We’ve got a lot of people behind the scenes that help put this podcast on every week. We couldn’t do this without everybody behind the scenes. I can’t do this on my own. I really appreciate everybody doing that.
I really appreciate y’all tuning in every week, and this is gonna wrap it up for this year. As we’re signing off, I wanna wish everyone a happy Thanksgiving. Have a merry Christmas, a happy New Year. Be back with us the first Tuesday in March as we come back with some more exciting episodes for you. Until next time, this has been Mike Howell with The Dirt.
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