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The Rural Voice, 1980-02, Page 30Spreader patterns studied Mike Miller, Associate Agricultural Representative, Huron County This past spring we checked two fertilizer spreaders for evenness of spread. A representative from the spreader company helped us set a number of tests at different rates. We collected the fertilizer in a set of pans set at eight foot intervals across the spread pattern. The results - you can probably guess. There was a wide variation in the spread pattern. For example, when we tried to apply 400 pounds per ac -e, we applied 580 pounds to some areas of the field and 190 pounds to other areas. This variation was by weight. The analysis variation would probably have been greater. I discussed our results with a manager of a fertilizer plant. He said he wasn't surprised. Fertilizer spreaders have been doing this for years and we still get good crops. He said phosphorus and potash tend to give a more uneven pattern than nitrogen. This unevenness of phosphorus and potash tends to balance out over the years. He also said our present spreaders are a lot better than the ones we used to have. Fertilizer spread patterns will change if you change the rate being applied, ground speed or analysis of the fertilizer. Some fertilizer mixes tend to separate more than other mixes. Bulk fertilizer spreaders are here to stay so we have to live with the errors in their spread pattern. If you have to apply a large amount of fertilizer bulk spread, then you will get a more even spread by spreading at half rate and covering the field twice. Also. if you are using the same spreader year after year, there are a number of ways of cancelling out poor spread patterns. If possible, never drive in the same tracks. In fact, you will get the most uniform spread by spreading at right angles to the last application. If you can't spread at right angles, then start at the opposite side of the field or drive at an angle. Mailbox of the month qqt (Located in Colborne twp. Huron County) Pay your spouse? It looks as though the officials have heard the word - that farmers and small business operators should be able to pay their spouses wage for work, done for the business. The most recent proposed budget had that provision. We'll have to wait until after the next election to see if - this concept surfaces again. Otherwise, it is necessary to form a corporation or spousal partnership to achieve this end. An Income Tax Bulletin indicates that a spousal partnership exists whenever both spouses have made a contribution of capital and -or labor and management. If you form a spousal partnership, it is wise to keep a file to answer questions such as what were the original and continuing contributions of capital by each spouse? What is the registered ownership of assets? Who can write cheques on the farm bank account? How much labor does each spouse contribute to the farm business? Don Pullen Ag. Rep. Huron County And now the bad news The annual Agricultural Outlook Confer- ence held at Ottawa forecasts a rather gloomy picture for 1980. Net farm income in Ontario may be 40 per cent lower than 1979 and 12 per cent lower for all of Canada. Grains should remain steady to stronger in price. Beef is predicted to be 10 to 15 per cent higher while hoe, prices will average lower than 1979. The big news is that costs will be sharply higher with petroleum based products leading the way. Overall, interest rates will be slightly higher but the average prime rate will likely decrease in 1980. Forward selling is big business BY DONALD SHAUGHNESSY, CA Farmers can sell their crops before they're grown. It's called commodity hedging or tor - ward selling. Before the seeds are even in the ground, the crop : can be sold to a speculator who is willing to gamble that the price he pays is below the price for which he can sell it. The advantages are obvious. If a tarmer has a pretty good ideaof what it will cost him to grow his crop he can usually sell it in advance at a known profit, and be sure that he is going to earn that profit. He is protected if prices fall. But if prices rise, it is the speculator, not the farmer, who makes big money. Farmers who forward sold their corn crop at S2.45 a bushel this year made a fair profit. But the United Co-operatives of Ontario, which agreed to pay in advance, won on the gamble when prices rose to 53.15. Naturally, a lot of farmers who sold in PO. 28 THE RURAL VOICE/FEBRUARY 1980 Air advance were bitter about not sharing in the big gain. That's all part of the gamble, however, and if a farmer wants to protect himself against big losses, he also has to sacrifice the opportunity for big gains. Forward selling can bring a degree of stability to agriculture that has otherwise been missing. The farmer has been the victim, and sometimes the beneficiary, of market fluctuations. By hedging, he can com- pletely eliminate many of the unknowns. Once the farmer sells a contract, however, he must be prepared to ante up cash to the brokerage company, when the price of the commodity rises above the contract price. It is money he gets back but which he must nevertheless borrow from the bank, and most Canadian banks have been reluctant to lend the margin money. Things are changing, however, and more banks are willing to lend margin money, since it is a sure thing. Suppose, now, that there is a crop failure that the farmer can only deliver three- quarters of the crop that he promised. Well, he would lose a pile of money but he would have lost it anyway. To guard against this eventuality, though, banks usually require that only half a crop is forward sold, and it is probably a good idea. A forward contract on half the crop reduces the risk of a sudden plummet in prices, and enhances the farm profit if there is an unexpected price rise.