I understand the issue far better than you ever will...because I was FORCED to understand it. After spending years in the business world as sales management executive, I just yesterday finished a "Year End Cash Flow" statement for a moderately large farming operation (not sugar beets).
Many of the farm price support payments do go to very large cooperatives, absentee land owners, etc....fine...get rid of them! No problem there, whatsoever.
However, if you are interested in the actual life of the every day farmer; who, unlike other businesses, has minimal control over the prices paid for product, absolutely no ability to pass along increased input costs to the buyer; all while watching the "value-added" purchasers of his product raking in the millions...do get back to me.
We are talking about a rather low-debt, multi-million dollar operation, paying a couple of $20,000 per year salaries to two owners working 80 hrs/week (would YOU do that?). After figuring all input costs, and using a price for our grain that is completely manipulated by a system that should have been scrapped once everyone had phones, let alone the internet (the Board of Trade); we had a whopping 2% net profit! Whoo-hoo!
That is with the guaranteed government payments included.
If you still think that the price supports are not a gimme for the big campaign producers; if you still cannot understand that in a box of Corn Chex, you are paying for about $.20 worth of corn and $3.00 worth of everything else...do get back to me. If you get rid of the farm subsidies, then let us sell to anyone we want, at any time, anywhere...with no restrictions. WE cannot do that.
Since you are so knowledgeable, please do tell which "crops" Americans are supposed to focus on...we'll get right on it. I'll wait right here; as we need to make more money.
Not knowing more detail than what you've provided I'd say that, under these circumstances, your company should absolutely exit the industry and allow the larger and more efficient operators to fill the void. The fact is, agriculture today is dominated by large co-op's with tremendous efficiencies. We've had to do this to remain competitive. Unfortunately, the welfare you defend is used by these co-op's to undercut small and medium sized producers and, eventually, drive them out of business or buy their operations.
the every day farmer; who, unlike other businesses, has minimal control over the prices paid for product, absolutely no ability to pass along increased input costs to the buyer
Please, the plight of the poor farmer is hardly going to earn any sympathy when the average family farm has a household income 17% higher than the national average and a cost of living that is 10%-40% lower than urban areas. Farms fail at only one-sixth the rate of non-farm businesses, and only 4.5 percent of farms have enough debt to be considered vulnerable to bankruptcy.
I guess it's easier to blame others though, isn't it?
..all while watching the "value-added" purchasers of his product raking in the millions...do get back to me.
So, you're in the food business. So am I. Maybe you can show me which of these value added food manufacturers makes extraordinary profits and exactly what those margins are. I ask because it's well known that the American food industry is highly competitive and generates lower, yet consistent, margins when compared to other industries. When comparing net revenue as a percentage of sales for all industries, food manufacturers rank well below the national average. Food retailing and distribution are even lower. So, who's making all those obscene profits?
please do tell which "crops" Americans are supposed to focus on...
If the government would just get out of the way and stop interfering, the markets would sort this question out in very short order.