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HomeMy WebLinkAboutThe Wingham Advance-Times, 1985-03-20, Page 55Focus of sheep production changing By Sharon Dietz Sheep breeders have traditionally focused their attention on production more than economics because they spent so much time trying to keep the "sitters" alive, according to Don Pullen of the Clinton OMAF office. Sheep producers figure if they can keep production up the finances will take care of themselves. But the decline in sheep production due to predators and internal parasites, the two "profit robbers" as Pullen phrases it, has caused agriculture representatives to become more involved in the financial management of sheep production. • When farmers think of financial manage- ment they think of bills and the need for money to pay them, says Ri len..lhis require- ment reinforces the need for record keeping. The heart of sound financial management is information which allows you to analyse current and past performance to plan for the .future, states Pullen. Records provide the basis for effective decision making. Cash records are okay for Revenue Canada purposes but this type of record does not take into account receipts, balance payable and inventory. Farm records are one the last chores a farmer gets done, says Pullen. Usually farmers tackle their bookkeeping late at night when they're finished with other jobs around the farm and they are tired, But farm records provide financial and physical information which, if kept properly, are irreplaceable. Physical information includes barn record sheets and ewe record cards while financial information includes the balance sheet, a list of what you own and owe to others at any given time. A balance sheet can be used to support a loan request as it is the most commonly requested document by lenders; to show farm business progress and as a snap- shot of farm solvency. A balance sheet has its limitations, however. When land values turned around banks were no longer looking at the balance sheet but at the cash flow to see if farmers were capable of servicing the debt. Input costs are rip dramatically witli' no .. increase in commodity prices and credit is no longer based on fixed assets but rather the cash flow projection. In 1975 it was possible to get a Farm Credit Corporation loan for fixed assets at about 8 per cent interest. FCC loans were 161/4 per cent at the height of the recent interest rate crisis and currently FCC lends at 129/4 per cent for five years amortized over 20 years. Farm improvement loans were seven per cent in 1975 and now they are over 13 per cent. It's difficult to get long term credit and the chances of in ,mediate credit are iffy. Some danger signs to look for, wams Pullen, include using more credit for feed bills and supplies. Suppliers and feed companies charge two per cent interest per month which is 30 per cert a year and that kills. Another danger sign is borrowing more each year to plant crops or buy replacement livestock. Good financial management has its featur- es. One is proof - physical records to support your request for loans and cash flow claims. Budgets will show how much debt you can service and records allow regular monitoring of your financial situation and permit a marketing strategy. Such a strategy incudes calculating returns on resource units and cost control resulting in unique ideas for controlling costs or decisions to repair, rather than buy new. Berm reroutes water to underground tile ...• • from page 10 berm ponds the water rerouting it to an underground tile, preventing the water from running across the land creating a gully right aaoss the 'farm The berm `also prevents top soil from being swept into the drainage system where it has to be removed. The basin is big enough to store water from 60-70 aces. . Two smaller structures are required down stream about 1,000 feet apart. Control of spring runoff in this manner would effectively stop the erosion of gullies along the Huron shoreline if farmers inland were employing soil erosion practices. Such erosion control would also effectively reduce the Dost to the township for cleaning municipal drains and to the taxpayers who pay to dredge Goderidh harbour. The Flom Edition, Week of March ,20, 1985 - 23 GRANGER'S T.V. Goderich Your Locol 524-8925 c= commodore Oealer For HARDWARE & SOFTWARE For Sale Cattle oilers s- Round Bale Feeders po Mineral Feeders Feed Carts Stable Partitions it Farm Fence Gates Contact: JOE KUNTZ R.R. 5, MILDMAY 367®2203 SIMPSON CONSTRUCTION R. R. # 3 WINGHAM [WHITECHURCHJ 357-3780 SPACEFRAME -tel -straight Sldewall -concrete piers FARM -2" x 8" roof purlins -2" x 6" wall girts -28 ga. galvanized roof steel BUILDING =3I0 ga. galvanized wall steel ds -2 - 12' wide sliding doors 40' wide x 72' long -cannonball door trail and hardware -all necessary trims 616,851 12 ft. high Discount 674 Completely Erected Price lbtal ANY SIZE OR PACKAGE AVAILABLE -MATERIALONLY- PIERS & FRAMES ERECTED -HEW WITH ERECTION 1985 FORD F150 WORKMATE � PACKAGE INCLUDES: *'AMMETER & OIL PRESSURE GAUGES * 6100 G.V.W. it P235x15 ALL -SEASON RADIAL TIRES �1r N.D. BATTERY * 4 -SPEED MANUAL TRANSMISSION.. * H.D..SHOCKS * H:D. FRONT SPRINGS SAVE 67200 ON THIS WORKMATE PACKAGE DON SCHNURR MOTORS WALKERTON 881-1506