Latest / The Vance Crowe Podcast / Ag Tribes Report: Zack Smith; Food Price Controls, Farmer Suicides, and farmland priced in BTC @zebulousprime
Transcript
- Vance Crowe (02:59.738) Welcome to the Ag Tribes Report. I'm your host, Vance Crowe. Each week I bring a co -host to represent the perspective of one of the many ag tribes that collectively make up U .S. agriculture. This week I am joined by the one and only Zach Smith, the stockcropper farmer who combines raising livestock on cropland, a blending of large -scale modern ag with pasture -raising animals. Zach Smith, welcome to the Ag Tribes Report. Zack (03:27.657) Vance Crowe, it's privilege to be here. Thanks for having me on. Vance Crowe (03:31.577) So today we are going to be covering the news that includes the USDA crop report. We're gonna answer the question, will Kamala Harris cap food prices and are farmer suicides on the rise? Then we'll get to hear Zach's Peter Thiel paradox where we find out what is something he believes that almost nobody knows agrees with him on. And we will also hear about who his worthy adversary is. So let's jump into the headlines. Straight away from agriculture .com, they were reporting that the USDA increases 2024 corn production and demand and lowers ending stocks. The average trade expectations for corn and soybean yields respectively was 183 .1 bushels per acre and 53 .2 bushels per acre. This seems pretty high, but Zach, what in the hell does this report even mean and why does it have everybody in ag worked up? Zack (04:29.365) Well, it's a big deal. It's some of the biggest numbers that we've printed for projected yields, especially on soybeans. I know I think that was the record high. so our demand, especially for soybeans and exports, is really in the crapper. And so it's set the stage for rough times on the farm when it comes to commodity prices. I looked here this afternoon. My local elevator in Scarborough, Iowa, was paying $3 .60 a bushel for corn. and a nine three today for new crop beans. And that's not good because the crop that we've got growing in the field right now, you know, here across the corn belt is the most expensive crop in history that farmers put in. you know, farmers, you know, we were coming off the price plateaus the last three or four years, you know, kind of fueled by drought and, you know, war in Ukraine that kind of helped keep things up. And this year it finally rained. And so we've got a ton of crop coming to market and demand not going to keep up with it. And so we're looking at probably some pretty heavy losses for people that weren't able to forward market ahead. And that's why conversations I'm having with buddies and friends locally and around the country is a lot of concern for what's ahead for financial future here. Vance Crowe (05:51.832) When I started the Ag Tribes report, I took a look around and said, hey, there's a lot of people out there talking about prices of commodities. And I know that's business. So you gotta talk about it to some degree. But week in and week out, this has been the big story. Is it a slow moving storm? Is this just telling everybody what they already knew and confirming it? Is anything potential change? Are we gonna be talking about this for the next eight, nine, 10 weeks, maybe longer? Zack (06:18.869) Yeah, I think so. mean, I, you know, so one thing that makes it hard to swallow, especially in my neck of the woods, the Northwestern Corn Belt, Northwestern Iowa, Southern Minnesota, Eastern South Dakota, and North Dakota little bit. You know, we've had a terrible year. It's been, you know, we had 20 to 25, 30 inches of rain between planting and 4th of July. So we've kind of been concerned from a production standpoint for a long time. But everywhere else that I've been, I've traveled out to Illinois, I've been to Nebraska, driving across Iowa. For the most part, the crop looks fantastic. And I think most people knew that. But they got caught with their pants down because we kind of thought we were always promised of this June rally that we get, May to June rally. That's the best time to sell. And we never really got it. And so people. Still had old crop corn leftover that they had marketed and now new crop that's uncommitted. And there's a lot of people that are, you know, it's going to be an uncomfortable conversation when they go in to see their lender and you look at the falling price, the, you know, the falling value of commodities they had in their cash flows and as well as, you know, especially machinery values. I mean, I've really noticed in the last couple of weeks, stuff has been really starting to fall off and that impacts everything going into 2025. Vance Crowe (07:33.119) Yeah, I remember maybe a summer or two ago when I was talking with a grain bin company and they were saying, we are building more grain bins than we ever have before. There's more storage in the United States than there's ever been. And back then it didn't cross my mind that by having more storage, you could potentially have guys holding back. They're not having to put it in an elevator and rent that space from a grain elevator. So they put it in there and say, well, I'm going to wait till prices go up, not expecting that prices could continue to go down, down, down, and then have what are in some places record yields. Zack (08:08.373) Yeah, 100%. Actually, there are some people, because they've got enough storage now, that they're talking about actually holding over their old crop and not liquidating here at the bottom. in our neck of the woods, we're going to have grain quality issues with how uneven our fields are from the wet spring and summer we've had. so some folks are talking about maybe just hauling the crappy quality stuff in and keeping the good quality corn over from last year to try to manage things that way. Vance Crowe (08:34.91) Well, and before we move on, there's something to note, and that is that we've got not just the bumper crops that we're seeing, but even the soybean record was just recently broken for how many bushels per acre. What do know about the soybean record being broken? Zack (08:50.517) yeah, I've known this guy. think he broke it last year too at, I think he was a little over, maybe it was 206 and he, guy from, I think he's from Georgia's names, Alex, something or another. and I think he broke two 18 this last week, which is absolutely phenomenal. you know, you know, the reality is, is that it's going to be a long time before we have to worry about 218 bushel, beans or 626 bushel corn being the norm. you know, those things are interesting and it's amazing. Like those guys are geniuses and they're, you know, it's awesome what they achieve, but it's a, it was interesting in that article. He, even he was talking with a super high production, you know, levels of, of what he's growing. He was worried about his own break even because he's spending, you know, I think he had like four fungicide trips, you know, so that could be a hundred dollars an acre right there just in fungicide that he put in. So they put in a lot to get, to get to that and, You know, there obviously not, you know, it was a two and a half acre block that I think that yield came off of. So wasn't like he had that across 10 ,000 acres or something. So, but still a hell of an achievement tip of the hat. Vance Crowe (09:56.496) Yeah, and I have a... You gotta give it to them. They also have a little bit of a benefit in Georgia. One of the Monsanto scientists I was good friends with back in the day told me in Georgia, they got so much sand in their ground, which allows them to just water the absolute bejesus out of that soy, which allows it to grow without getting flooded out. All right, enough about big booming amounts of crops. We should turn now to the Washington Post, which said Kamala Harris is going to propose a ban on price gouging for food and groceries. Apparently her campaign released a memo saying on Friday they are going to put out a proposal ban on price gouging at grocery stores and overall on the food industries. Now we don't know anything about this and I always try and get to the original source material but apparently the Harris campaign they're not posting this on their website they must have only sent this out to major media but they're all talking about it. What do you think happens to farmers, Zach, if the government starts interfering and putting caps on how much a grocery store can charge for food? Zack (11:02.005) To me, this is kind of a nothing burger, personally. The farmer's share of the grocery bill is, I think, 15 cents on the dollar. And it's going down, I think, some of the data that I looked at preparing for this. So when I look at this story, to me, this is probably just the fact there's no details or any real policy in the background. I think they need to do something to show that they're being proactive about inflation and food. The food bill is something you can't go without. You can't cut food. So going to the grocery store, you're a captive audience there. To me, if they were really serious about doing this, and it's just not food, right? Ever since COVID, it was kind of this excuse in the background for corporations to just raise prices. So the food industry, it's just not that problem. Everyone got greedy and corporate profits were through the roof. My opinion on this, and I've had it for a long time, is that if we're really interested in controlling the corporate greed, we have so little competition, even in the major grocers that are across the country now, the consolidation that's happened with them is really disturbing. And there's just a couple major players left in the food industry that are making a lot of this stuff at the top levels. so for me, Unless we're going to bust up something like Citizens United where corporations are people and they can buy politicians to keep this stuff intact, there's not much that I'm going to be able to do about it. And I'm not growing stuff that goes to a grocery store. I'm growing corn for ethanol primarily and soybeans for oil and hog feed with soybean meal. That's where my stuff is going. Eventually some of those byproducts end up in food, but this is... Not a big deal to me, anyway. Vance Crowe (12:52.311) To me, even just getting involved in the Ag Tribes report has opened my eyes. One thing is I can go to the grocery store now and see the very clear run up on the price of things like eggs. But it was last week when I was talking with Dwayne Faber to realize that the government actually does have a hand in what the price of dairy products are through the way that they make the producer of the cheese or milk back to... dairy farmer. They influence how much money has to go back there in a whole convoluted price. There's certainly a lot of regulation that goes into the price of our food. And if you think about things like meat and meat processing, the incredibly onerous regulations make it so you can't have new entrants to the market and you only have these big conglomerates. unless you get rid of that, I don't... The price is what the price is because there's very little competition. Zack (13:50.249) Yeah, we have to break this stuff up. It's anything else is just nonsense in my opinion. I, so a shameless plug that I would put out if you're interested in this, I would suggest people go watch the film that we were in with our story with stockcropper fooding too, which talks specifically a lot about the consolidation and a lot of the issues and the amount of control the food industry has over. over all the stuff that we've just got done talking about. And it is streaming free now if you have a subscription of Hulu or Disney Plus. So I'd throw that shameless plug in there. Vance Crowe (14:26.41) Well, think it's something has to be done. And I think, you know, the biggest thing is that people go to the grocery store and if they don't understand economics, then it's very easy to blame the people that they think, you must be making huge profits because your price of eggs per dozen was 250 last week and now it's 325 or 350. And, you know, you're not paying that much more. So it clearly you, Robert Baron grocery stores are doing, you know, wrong here. when the reality it's the value of the US dollar continues to march downward and what you can buy with it gets less. Zack (15:01.109) Right. The other thing I would say to this is that I have the stockcropper, but I'm producing a very small amount of animals off this experimental setup that I have. if you are somebody that, if you care about this as a consumer, I would suggest people just deal with people as directly as possible. If you're concerned about the... the greed in the food. There's a lot of people that would love to sell meat directly or their produce. so reach out and work directly with other human beings or get in the business of growing stuff yourself, which that's one of the things that we're interested at promoting with what we're developing with Stockcropper. Vance Crowe (15:46.909) Yeah, and when we get to the end, we're gonna talk about the big field day that you have going on. And I think it's an exciting thing for people to get together, because this is a way to create that kind of food sovereignty you talk about. But all right, to continue moving on, we're gonna go to the third and final news story of the day. This has been a huge discussion on X. It came up this morning. I'm sure it's going on in other circles. I didn't see even before it. But are farmer suicides on the rise due to depressed prices and increased costs? I know this morning I woke up And I saw that Angie Setzer, the goddess of grain, quote tweeted the, a, Ag Turbo Brazil, who's a contractor or he does consulting about Ag stuff. And he says, kinda in shock this morning with updates from my brother, in Northwest Minnesota, unless I'm misreading things here, there have been six suicides in Northwest Minnesota and Eastern North Dakota in the last two weeks. This includes people from 22 years old to 60 years old. So Zach, what are you hearing? Are firmer suicides going on in your circles and is it larger than just the average population? Zack (16:57.301) So recently, like in my local circle, we haven't had much for suicides. But I think with what I talked about earlier, with the pressure that's going to be coming down on folks that we haven't had really in about three or four years, at least in our locality, that I'm kind of my tribe of what I'm speaking of, it hasn't been much of an issue. I really am concerned. Personally, I actually have some friends that I'm worried about that are in pretty deep and under a lot of pressure. As far as the rate of suicides being higher in farm communities or not, I don't know what that actual data is. But I do know that the risk in our communities will be going up with the economic conditions that we're likely in for the next couple of years with supply and demand and the way things are shaping up and just how the It's a brutal business and you know unless there's going to be some huge bailout there's going to be pain and more consolidation. Vance Crowe (18:01.337) Yeah, so I'm glad you brought up the numbers. This has been something that I've thought about for quite a few years. I remember when I was at Monsanto, there were a lot of groups popping up saying, hey, we got to do more for the health of farmers, their mental health, and this is a big problem. And I went to look at the numbers and I know it's a controversial thing to say. Any suicide, any time somebody takes their life, it's a bad deal. But the talk that it is so much higher in ag is not obvious to me. I think that's something that keeps getting repeated. I went to look up the statistics and it is a little bit more difficult. I can say the statistics are very clear for groups of people like veterinarians. These people are leading really isolated lives. I think they're having to see a lot of death. And so maybe by extension that's going on with the veterinarians. But one thing I wanted to bring up with this conversation about firmer suicides is one thing research does show pretty clearly is that people that hear more about suicide and hear about things like suicide hotlines, it can have the opposite effect. It can actually prompt people to have more suicidal ideation. can sometimes say, I didn't realize that other people took this option. maybe this is an option for me. And this is something you can do a public health study where you run interventions in a few counties and then you'd find some counties that look just like it and you don't run those interventions. It turns out in the places where you run interventions, particularly for teens and you tell them, hey, this is a suicide hotline, it has a tendency to bring some of those numbers up. So I don't know, what do you do in a situation where the more you try and help, it may be leading to more problems? Zack (19:49.173) Yeah, I guess I'll hear that. I guess the thing I would say to it is, the thing I'm focusing on, I don't really care what the data says, one way or the other, I'm going to focus on reaching out to people and making an effort to be kind and probably more sensitive than what I've been in the past because you never know what people are going through in this business. When you're dealing with a lot of things outside of your control, specifically like in our neck of the woods, the weather has just been unrelenting this summer. And I actually sit kind of on the fringe of that area. It's much worse north and west of me. You know, the pressure of that and you've got low commodity prices on top of it. And, know, say if you've been in the livestock business last, especially hogs the last couple of years, that's been brutal. you know, you, you put on top of that family pressures and keeping up with the Joneses and your brother works in the city. You know, they've got a lake house and six cars and everything nice and you're trying to keep up. Like it's a lot that weighs on folks. So I think, you know, regardless of, you know, some of the stuff you said, I just, I would just encourage people to be good to each other in these tough times and egg Twitter, especially can be a shitty place. And, you know, I think, reaching out, having phone conversations. I try to make a habit of doing that, especially with those that I'm worried about. especially this fall in the combine, I'm going to be a lot more proactive about doing that just to make sure everyone's OK. And sometimes that can make a huge difference just getting a phone call where somebody knows, hey, you matter to me. And I want you to know that. Vance Crowe (21:40.052) Yeah, I couldn't agree more. think that imagining that the public health interventions that are going to do a lot of good are not good enough and that the reality is it's only you picking up the phone and calling somebody that you know is going through a rough time. It's spending time with people. I found a very interesting article while doing research for this in the neuropsychiatric disease and treatment. It said one of the biggest interventions that has worked is helping wives to start better conversations with their husbands. And this ranged from all different ages when they were starting to empower the wives to ask questions, to get their husbands to open up. That made a huge difference. I have to imagine friend to friend, this is gonna make a big deal. it really comes down not to some public health intervention, but to the individuals. Any last words on this, Zack (22:28.853) You know, yeah, and the other thing I would add is, one thing that's that is rampant in this business, especially in the culture of agriculture is, you know, substance abuse, alcohol, especially, you know, where that's, and that's been my coping mechanism for forever. you know, but you get into situations like this, it isn't good. I've personally tried to cut back substantially on that this summer. and I feel a million times better in, know, integrate more exercise and, know, I think that's hard to tell somebody to do, especially when they're down, but it's incredible how much better your day goes. And I know in talking with you, know, you've had kind of a similar experience this summer, and just spreading that positivity to other people. And, you know, it's, because that's, that's a powerful thing and that's actually being productive with it rather than destructive. So. Vance Crowe (23:22.093) Absolutely, I totally agree. Finding a way to get off substances allows you to have a more restful night of sleep. You wake up the next day and you wouldn't believe how much better things can get when you wake up the next day. I want to say thank you to the goddess of grain for bringing this up. Her message was, hey, things are going to get better. A year from now, you're not even going to remember how tough this was. And I think she's got a good message there. If you have any news that you think we should be covering, Go ahead and send it to me on x at Vance Crow or email me vance at vancecrow .com. I always put together a list and I'm always looking for more stories. Now on to the Bitcoin land price report. Now we're going to start reporting the land prices of our co -hosts and making sure people understand just how much this would cost in Bitcoin. to begin, Zach, you're in Winnebago County, Iowa. What is land going for there right now? Zack (24:13.695) So the last land sale was I think about a month ago and it wasn't it was pretty small parcel that I recall And not that great. It sold for about ten thousand six hundred I think and in the last year the high that we've had was eighteen thousand six hundred Last about a year ago right now about this time. That's kind of the range So if I had to put average now like what value is probably thirteen fourteen thousand dollars an acre if I had to guess for good farmland Vance Crowe (24:42.843) Yeah, so I was looking it up. It's in the low was about 10 ,600 for kind of lower quality and then 15 ,000 for higher quality. So that means the range per acre is between 0 .18 Bitcoin per acre or 0 .25 Bitcoin per acre, which is just absolutely staggering. If you had a quarter of a Bitcoin, you could buy one great high quality acre in Winnebago County, Iowa. How does that sit with you, Zach? Zack (25:10.133) Well, I guess I've got a kind of, probably something that's not very popular right now in this climate that we're going into with the way things look. I'd rather own Bitcoin than land. land values are finally starting to fall and you're trying to get an actual economic return off of 15 or $20 ,000 an acre ground with 360 corner 903 beans. Not a great thing. if we're not going to do things to change stuff for the future, I know land is always supposed to go up, but there's definitely been periods where there's pullbacks. And when I look at the money printers turning on here soon and all of the financial powers that be that have been lining up behind Bitcoin over the last six months since the ETFs come out, if I'm an owner of hard assets right now, I'm a Bitcoin man. Vance Crowe (26:05.272) Well, you know, I love hearing that Bitcoin is for enemies because the best thing about it is even if your enemies love Bitcoin, if you have it, then it makes your Bitcoin go up. It's not a the same kind of competition. The earlier you get in, the better it is for you. All right. Enough with the Bitcoin land price report. Moving on to the Peter Thiel paradox. This is where I invite our guests to tell us about some opinion that they hold that almost nobody in their tribe agrees with them on. So Zach. What is your Peter Thiel paradox? Zack (26:37.749) this has been more of like a pet peeve that's been brewing for some time, but it's like farm show season coming up. And, one of the things that drives me wild is the people that grow food for the world is when you go to these things, how no one walks anymore. Like everyone brings a golf cart on a trailer or a ranger and they pay extra to drive themselves around to look at $1 .2 million combines. And. I noticed this, I went with a guy about six or eight years ago and he insisted on riding in a golf cart and I'm like, I don't want to do that. I don't want to appear that apathetic that I can't walk my ass across a farm show. And he got mad because I wouldn't get in the golf cart with him. But like, I can't hardly stand going to these things anymore personally. And that's one of the biggest reasons is that, you know, when you look at, and this is This sounds critical after the suicide talk, but I'm just going to say it like we do not look good as a population as farmers. And the fact that you show up to a thing celebrating the people that grow the food, it doesn't say a lot when we can't, we're overweight enough or we're not healthy enough where we can stand for walking around, you know, whatever the parcel size is there for, for a day. It's just a bad look. It's not healthy. It's, don't know. I can't imagine, you know, what the international. guests that come to the Foreign Progress show or things like that think when they see us, know, trotting around. And it's not like, I get there's people that are handicapped and like have actual issues, but there's like 15 year old kids and like abled body 30 year olds riding around on a golf cart instead of walking. So, just a challenge. If you're going to Foreign Progress, leave the shit at home and just walk and enjoy the day. Drink some water. Vance Crowe (28:28.694) Well, this is an unexpected one. It's hilarious that it'll probably really piss some people off. But overall, I imagine there's quite a few people that agree with you that more should be walking. I'm going to give you a 7 -1 on your Peter Thiel paradox. All right, now onto the worthy adversaries. This is where I ask our guest to spotlight an individual that challenges his perspective and keeps him out of algorithmic echo chambers. So Zach. Who is a worthy adversary for you out there on social media? Zack (28:59.125) So the guy that I would point out goes by the, and this guy is pretty infamous over the last 15 years. He goes by the handle, the Mizzou Tiger. And he has been a really controversial figure that has been on AgTalk. He's been kicked off. I think he was on the successful farming's chat forums. And then now he's on X and he's a really smart guy. Like I read a lot of his tweets and it's obvious that he has a lot of good things to offer. but he really got under my skin. This is something that he's done consistently. This guy doesn't have a name, so he's just a nameless moniker on Twitter. But he went after our mutual good friend, Jason Mock, here in the last couple weeks. And really was pretty brutal to Jason with some of it, going after, making comments about his family and how he's a daddy's rich kid. This guy doesn't know shit about Jason's story or what Jason's gone through in the last year and a half. And so the thing I would say is, and I'm not trying to necessarily pick on Mizzou Farmer, but there's a lot of people on X that don't have their names in their profile and they talk shit out their ass all the time. And when we're going into times like this, you know, if you want to talk and be that way, that's fine, but put your name and your picture up. And you know, don't say things on X to people like that unless you're willing to say it standing three feet from them. That's kind of the rule. And I know I put a lot of stuff that probably pushes people's buttons, but I'd never tweet anything I wouldn't say to somebody's face. so Mizzou Tiger, if you're watching this, just be a man. Put your name on and anybody else, just own your identity and be decent on this stuff. That's it. Vance Crowe (30:47.269) Wow, okay, I had no idea who that was and the context. So this is interesting. We will put the, the, him on the show notes and then we'll also add him. I have a list of worthy adversaries out on X and it turns out when I go to do news stories, even as much as there are a lot of the people that are get put on this list are people that great on our guests. It ends up, they have a lot of interesting news to talk about. thank you, Zach, for taking this seriously. And that is going to wrap us up for this week's Ag Tribes Report. Before we go and before we talk about our sponsors, you Zach have a big field day coming up here on August 24th. Why don't you tell everybody why is it that you host a field day and what are people gonna get if they come? Zack (31:35.221) Yeah, so we started the stockcropper in 2020 because we were trying to find a way when commodity prices were in the sewer to raise our revenue ships without having to spend more money. So that's really at the core of what we do is about. if you're feeling like you're up against the ropes right now and you want to come be around some people that think completely outside of the box in ways that, you know, this idea that we call farming weird that we've unlocked a lot of ways to build value without spending more money on your farm. You're going to look different when your neighbor's doing it. But if you're interested in that stuff, invite you to come to our farm. There's going to be a ton of great folks that are innovative thinkers outside of the box that you're going to be able to see the different experiments. You're going to see our cluster clucks work and the debut of our new cluster cluck Pico. Lots of different plot experiments with different crop spacings to show plant expression in ways that you can, like I said, you know, raise your ships of revenue without spending a lot more money. I'd love to have you come. Everyone is welcome and RSVP to us in the link here that Vance will have in the description. Vance Crowe (32:45.658) Well, one thing I want to say is I was just so surprised at who came because it's not all farmers. Sometimes it's people that are outside of ag that just find it interesting. Some of the people were there with their phones saying, hey, let me show you what I did last year. It was the first time I'd ever tried something. And I think what is so amazing about your field day and Jason Malk's for that matter is It changes people. It gives them a community. It gives them a way to try something new. And that's why I'm gonna make the, whatever it is, eight hour trek up to Buffalo Center, Iowa. I'll be there next Saturday and I'm really excited to do it. So good luck. We'll put the link in the show notes. And I know that if people are looking for your Eventbrite so they can RSVP, they can also find it on your Twitter. All right, I wanna say thank you to our sponsors, Legacy Interviews. And farmtest .ag. Farmtest, of course, is the service that allows you to run scientifically verifiable tests on your fields to find out if that fungicide, that insecticide, that nitrogen, or the seeds you planted are really producing the sort of results that you expect them on your land. So you can be freed from using what the marketers are telling you and really find out for you. That's farmtest .ag. And also Legacy Interviews, where we record you. your loved ones telling their life stories so that future generations have the opportunity to know their family history. All right. Next week, I am going to be doing this show live from the Farm for Profit podcast studio. And Tanner Winterhoff is going to be my co -host. So we're going to do that. I'm going to do it on my trip up to see Zach's field day. I'm really excited about that. And so we're going to let you go for now, but I want to, as always, feel free to disagree.