The Hancock-Henderson Quill, Inc.
Greetings to readers of The Quill,
With the weather warming up and some of the fields drying out ole Cornelius is gitt'n as nervous as a long-tailed cat ina' room fulla' rockin' chairs.
I sometimes think some farmers aught to wear blinders-of the type we use on horses while we work them.
Blinders serve the purpose of keepin' the horses attention in its intended work and generally do not interfere with the job at hand.
If a a person could fit a pair of those blinders on some farmers, they wouldn't get so nervous if they couldn't see and perceive their neighbor was somehow gettn' ahead of them.
Most farmers by now have gottn' their shock treatment on the price increases for their crop inputs.
Pre-pay producers bought their inputs early and have avoided some of the increases.
Those produces that are just obtaining prices this spring are expressing dismay, especially when they ask about prices for inputs for the fall of "08".
It appears those pricing inputs for the farmer were tempted by the gains he appears to be receiving by Chicago Board of Trade prices.
Never mind that many of the farmers "07" inventory was sold out at much lower prices. If you read newspapers or watch the news, one would assume that "farmers are eatin' in high clover".
With that thought in mind, the manufacturers of inputs for the most part couldn't stand it any longer-and are acting like a drunkard smelln' whiskey thru' the' jail-house door. (couldn't resist temptation)
Sneakier than a weasel ina' chicken house they have raised prices dramatically on many inputs including machinery.
Between the increased cost of inputs, machinery, and land rent, it looks as tho they are pointing us back to the times of recent past where it's the chicken neck or nothing (back to hard times).
I read a couple articles recently that weighed heavier on me than a tail fulla' cockleburs (bothered me greatly).
Interestingly enough both articles showed up in my mailbox on the same day. One article appeared in the Wall Street Journal and the other in the April issue of Prairie Farmer.
The Wall Street Journal article reported on Monsanto's profits. CEO Hugh Grant described them as "a sustained windfall"
Mr. Grant was reported as stating that Monsanto's products would not be affected by corn/soybean acreage shifts and that "market-share gains, price increases and international expansion, would counter any short term fluctuations."
He also bragged that the company's products are traded out a lot later in the game than many other variable costs on the farm.
To me, this man's attitude has all the qualities of a dog except loyalty.
"Monsanto raised its full-year projection three times in as many months, reflecting gains in the herbicide business and strong early sales from its larger seed business" according to the article in Wall Street Journal.
The company brags of its latest quarter sales in seeds and genomics of $2.55 billion, an increase of 39%. Sales of agricultural-productivity products "shot up 58% to $1.23 billion amid higher sales of Roundup and other Glyphosate-based herbicides globally".
No one is against a company making money especially if you desire to do business with them in the long term. The fly in the ointment comes after the article in the April issue of the Prairie Farmer has been read.
Here I smell a skunk (suspicious situation). It appears to me that Monsanto's CEO Hugh Grant, does not think farmers might read the Wall Street Journal or that Monsanto's Vice President Jim Zimmer, who was quoted in the Prairie Farmer article, feels any inconsistency of the article he contributed to.
In the Prairie Farmer article Mr. Zimmer feared that if Monsanto didn't raise the price of Roundup, growers might not have any to spray over the top of their technology-intense crops. Mr. Zimmer is quoted as stating, "We didn't want to be in a position that if a farmer had a Roundup ready crop and wanted Roundup, that we couldn't supply that. So that's the fundamental reasoning that we've had to take some price increases". He is quoted as stating, "Prices had gotten so low that Monsanto weren't able to generate the kind of margins to justify building new capacity" to meet demand.
Now you gotta' wrassle them thoughts deep in your guts. It would appear executives within a company, should have a serious talk with one another to compare notes.
A large company saying they are raising prices for the farmers own good, in spite of the billions made, reminds of me of a story in my youth.
On a cold winter day I had chored in blow zero weather. Livestock waters were frozen and had to be broken free. In the effort, my hands were frozen with terrible pain. Every livestock farmer can relate to that.
However, upon entering the house I made the mistake of complaining of frozen fingers to my older brother. He quickly replied he could fix my mind off the frozen fingers if I willed for his help. "But of course," I stated, "apply your technique as soon as possible so I could forget my pain."
Immediately, he lifted up his big size 11 work shoe and stomped my right food-smashing all the toes. His effort indeed took my mind off my painful fingers, however to this day I'm not sure the "squeeze was worth the juice".
Thank you Agri-Business, but I'm not sure the "squeeze is worth the juice" in your remedy to assure my supply of your products by raising prices inappropriately.
And, I'm a little more than concerned about how those added profits might enable a company to smother out, or at least buy its competition thereby enabling the company to benefit me even more with another "foot smashing".
And I don't suppose it ever occurred to Agri-Business, that while its increase in prices might help the company with their supply problems, it does terrible things to the producers budget.
It also affects other products the producers might have need to purchase, including quality of life, and economic survivability.
I suppose the farmer-producer should thank you for absorbing more of his net income, so as to prevent supply problems in many other areas.
And, there is a "bone to pick" on another matter. The average producer has been very loyal to Monsanto. Product loyalty is proven by over 90% of his soybeans and an increasing percentage of his corn is given to your product.
The producer has increased, in Monsanto's latest quarter, by 39% his purchase of seed and traits, and genetic-technology platforms.
Corn sales in the latest quarter have jumped 47% and soybean sales rose 22%.
The farmer-producer has argued and defended Monsanto legislatively, publicly, and against the greens, in an aggressive fashion.
And, Monsanto's answer to the farmers-producers unwavering loyalty is to the kick him in the teeth by raising prices to supposedly solve the company's supply problem.
You do not appear to share many of the good qualities, any longer, of the companies you have bought out and taken over.
One would have to think some individuals "spend too much time talkin' from the' teeth out" or has been said, it appears you speak with a forked tongue (double tongued).
At least to those farmer-producers that can both read and reason. The web the spider has weaved, is now catching the fly.
Now that Monsanto is on their way to solving the supply problem through price increases, it could prove the sincerity of their loyalty to the American farmer-producer by a proportionate decrease in the tech fee-royalty fee. In reality, those who totally support you through seed and chemical purchases, would benefit the most.
In the meantime, unbridled greed combined with government-given monopoly, allows agri-business companies the appearance of pushing the perimeters.
One must remember that what the government gives, the government can take away.
Maybe it is time for us to press legislators to reexamine the anti-trust laws to address the situation our economy finds itself in.
See you later,