Five key actions for livestock and crop producers this autumn
Five key actions for livestock and crop producers this autumn
The fall season is a critical time for livestock and crop producers to prepare for the challenges and opportunities ahead. In this article, we outline five key actions that can position your farm for success in 2025.
Ready to prepare for the future? Keep reading to learn how.
With the arrival of shorter days and crisp fall breezes, producers start focusing on winter and preparing for the next production season. Fall is the ideal time to evaluate the past year, make important decisions, and position your farming operation for success in 2025.
Here are five key steps you can take to ensure you’re ready for the challenges and opportunities of the next year:
- Analyze your 2024 profitability
With calves weaned and crops harvested, it’s time to assess your profitability for the year.
While year-end financial statements likely won't be ready for another six to eight months, there are resources and tools — like our Profit Snapshot — that can give you an early look at how your farm has performed over the production year. This early analysis helps farm operators understand their profitability for the year, which enables informed decisions for marketing, pre-purchasing of inputs, equipment and land acquisitions, and land rent.
By the time fall rolls around, these tools can provide solid numbers based on actual outcomes, so you can make important management decisions during the cold, dark winter months.
- Update your tax planning and bookkeeping
- Evaluate cashflow and marketing decisions
- Record accurate year-end financials
- Stay informed on program changes
Autumn is the perfect time to sit down with your accountant to discuss tax planning strategies before year-end.
By catching up on your bookkeeping now, you’ll be better positioned to manage tax obligations, detail any potential savings, and avoid surprises when tax season arrives.
Additionally, use this time to update your financial records, so that tax planning is accurate and effective.
Should you sell your calves, or hold and feed them? Is it better to sell or store your grain?
These are the questions many producers face during the fall months. To answer them, you need to weigh factors like current commodity prices, interest rates, feed availability, storage capacity, and the need for cashflow to pay bills or loans.
The following information and table provides an example of the cost to hold onto your production. It outlines additional factors to consider when making the feed / store versus sell decision.
Example: Canola
Harvest completed: October 15, 2024
Total Bushels to sell: 10,000
Operating line interest rate: 6.45%
| Line item | October 31, 2024 | March 31, 2024 | Difference |
|---|---|---|---|
| Price ($/bu) | 12.33 | 12.60 | 0.27 |
| Total value | $123,300 | $126,000 | $2,700 |
| Days in storage | 16 | 167 | 151 |
| Interest cost | - $349 | - $3,639 | - $3,290 |
| Net value | $122,951 | $122,361 | - $590 |
| Net $/bu | 12.30 | 12.24 | - 0.006 |
Depending on marketing decisions off the combine or the timing of livestock sales, farmers may feel a cashflow pinch at this time of year, making the autumn season an ideal time to address any issues. That includes exploring options and resources like the Advance Payment Program (APP) that can help ease financial pressure with interest-free advances.
You may want to consider engaging a third-party advisor to help you complete and submit your APP applications and secure your cash advance. An experienced advisor can help set you and your operation up for success.
As the fiscal year draws to a close, it's vital to correctly log accrual items in your bookkeeping. These items include receivables, payables, inventories, and prepaid expenses. Accurately documenting these at year-end is a much more dependable approach than trying to remember them months down the road when you’re preparing the books for your accountant.
Accrual accounting provides a clearer picture of your farm’s annual performance. And accurate figures for receivables, payables, inventory, and prepaid expenses are essential for creating accrual statements. High-quality data and financial statements empower producers to make informed decisions.
Accurate accrual accounting also has a significant impact on government programs like AgriStability, which uses producers' accrual financial statements to calculate reference and current production margins. These margins are used to determine if an AgriStability payment will be triggered for a given production year.
So, as the fiscal year-end nears, take some time to accurately record your farm’s accounts receivables and payables, prepaids, and inventory.
This fall, ready yourself for the upcoming year by learning about any upcoming changes to tax laws, regulations, and government programming.
Consider AgriInvest, for instance. Starting in 2025, producers with $1 million or more in average allowable net sales will be required to have an Agri-Environmental Risk Assessment (AERA) to qualify for matching government contributions. Keep an eye out for a letter from Agriculture and Agri-Food Canada that’s being sent to producers who will require an AERA to qualify for the matching government contribution to their AgriInvest accounts.
Additional details can be found on the AgriInvest website.
Take action now for a stronger year ahead
Taking the time this fall to assess your financials, review tax strategies, and make informed decisions about your operation’s future will set you up for a successful 2025. By staying proactive and leveraging available resources, you can manage risks and seize opportunities in the months ahead.
Prepare today for tomorrow’s challenges
Marvin Slingerland CPA, CA
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