“We are $3000 in the hole already and I don’t want to make it $3020”

A quote from my lovely husband regarding our homesteading expenses to date.  He was speaking of the potential expense in getting a panel of some kind to secure the main gate to our barn, as the barn is set up for horses and the horse gate leaves room for coyotes to easily slink through.

This was his solution. Redneck engineering ftw!

The gate is an abandoned leftover from the old landscaping.  It’s secured, we rammed it like a 30lb coyote might if hungry and it held up.  Cost=$0.

A closer view. It’ll do.

 

The stuff outside is the old straw that was in the barn.  We tossed it out and it’s been breaking down over the last few months.  That pile was 3x as high when we mucked out originally.

As to where the 3k figure came from, that is for another day, whenever I can get the free time for those boring posts about homestead cost accounting.  Running numbers is way more time consuming than tossing up a few pictures, even with captions and commentary.

Sustainable Economics– When farmers fail math

I don’t know how often I will do this, but I’d like to start an occasional series on the nitty gritty economics of sustainable production.  I think a good start is noting some of the problematic aspects of current models of sustainable farming.  Today is looking at a bit of math fail from a sustainable farmer.

This farmer complains about “suits” at banks not advancing financing while admitting they don’t have the cashflow to cover a conventional loan’s terms and that they rely on customers for “loans” which are really gifts or agreements for deep discounts.

There’s some more in the linked article, but the valid points (that farming, being cyclical, needs to have that cyclical nature considered in financing models and lending small sums is sometimes loss leading even in fairly small regional/local banks even if the loan is repaid on schedule) are a bit lost due to the whining and refusal to be professional on the part of some farmers when this issue comes up.

Lending with repayment on a quarterly or trimester schedule is not exactly way out there in terms of business lending, but works pretty well with the cyclical nature of farming and is not quite as overwhelming to the farmer as semiannual repayments would be.  And local banks could band together and create a farm loan pool for all farms in a given region to slash their servicing costs.

But you’ll note neither of these things is in the article, despite it being an article about small farm financing difficulties.  This is altogether too typical when the topics of small farming, sustainability and economics are discussed in the media.  The article also doesn’t discuss the craziness that is borrowing from your customer base.  Here’s a hint– if you have to borrow from your “customer base”, you aren’t charging enough in actual prices to cover your expenses at a minimum, much less enough to cover your expenses and then draw a salary to live upon.

Having said that, it is not beyond the pale to have investors who started out as customers, or to work out some kind of communal-ownership arrangement.  But the article isn’t really dealing with unorthodox, inventive, or alternative business structuring.  It’s trying to argue that sustainable farmers shouldn’t have to worry about crazy things like profits and returns on investments.  But they should, like, be able to get loans on any terms that suit them and customers should both buy their products and give them money, just because.

If you support the “sustainable” in “sustainable agriculture”, it’s important to demand that farmers treat their enterprises as real businesses with real business obligations.  Professionalism matters.  Sloppiness kills, not just animals, but economies too.  We can’t get away from the industrially centered agricultural economic model so long as customers support sloppiness and laziness about the financing details from small, sustainable producers.  It is quite simply not sustainable, lasting, or real.  And more than farming techniques, the economics need to be there for sustainable agriculture to be a feasible alternative to industrial agriculture.  And that means dealing with the hard math and working to turn a profit and cashflow enough to justify financing support.

The Seductive and Misleading Economic Allure of Vegetable Gardening and Small Farming

As someone deeply interested in sustainable farming and gardening, but who also would like a little common sense about the profit motive to be part of the discourse, I used to be baffled by the expectations many small-scale sustainable farmers had about their potential earnings per acre.  Loads of blogs are full of people “farming” as little as 1/4 acre and thinking they can eventually generate a median income off what is no more than a large backyard.

And one of the big reasons they think this way is vegetable farming.  Vegetable farming is seductive because even with a small garden just for family one can garner an immediate savings and often a bit of extra income selling any excess.  Vegetables scale very well.  Additionally, one can leave a vegetable farm for a few days for a trip or break and those scallions won’t get eaten by coyotes (probably).  There are also a number of ways to sustainably, organically grow vegetables with relatively modest labor input.  All these things get people thinking that, say, the right kind of square foot gardening can turn half an acre into enough production that they can live on the income because one can receive dozens of dollars per pound of production and seed is often pretty cheap.

This kind of math fail is absolutely not a part of most sustainable farming conferences or other sustainable networking opportunities.  It is one of the many ways in which genuinely local-regional foodsheds are prevented from being developed because people end up working themselves out on acreage too small to scale up to production levels that would return a median or bigger annual income.  Or they experiment with livestock farming, failing to get the same benefits as if it were vegetables and don’t really understand why it’s not saving money, but losing money.  Farming is hard enough without the pixie dust thinking that people with big vegetable gardens and a produce savings scatter around to earnest folks hoping in a small way to grow a little of their own food.