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Source: Meristem news release

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Columbus, OH - Across the Corn Belt, farmers are investing in infrastructure, research shows: grain bins, bigger buildings, smarter machinery. But it's not just getting bigger that's driving them - it's getting different: diversifying farm operations with new revenue streams.

"In the 20 years just past, it's our sense the value of hard assets at the farm level has grown dramatically," explains Mitch Eviston, who leads Meristem Crop Performance, a recently launched provider of crop input additives. "This has happened even as the channel infrastructure has been slow to right-size their own investment." He points to several trends:

More farmers are spraying their own crops. According to recent Purdue University research, the number of acres being farmed to achieve the breakeven point for ownership of a self-propelled sprayer is 2,740. Added value comes from control gained: they can precisely schedule application when it's best for any given field. Another factor is the ease of use new rigs offer with guidance systems and precise, automated control of booms and nozzles.

Farms are adding grain storage capacity. Research conducted by Ag Economic Insights says "across the 18 select states, on-farm capacity increased by 1.68 billion bushels (from 2000 to 2014), a total increase of 17.6% (in that period)." When grain storage and drying is available closer to home, producers gain more control over harvest and marketing. Plus, they are investing in their own infrastructure and not someone else's.

Squeezed farmers are looking for supplier concessions. Some suppliers became bloated during the hey-days of $8 corn and $16 soybeans (2009 - 2013 or so) and may have had trouble downsizing in the intervening years. "In 2017, farm profits are down nearly 50% since 2013. At the same time, expenses for those farmers have only fallen 1.4%," says one USDA report.

Eviston, formerly with Winfield, says over-capacity in the channel is adding too much cost - hefty expenses national players pass on to farmers. This creates new space and opportunities for efficient and aggressive next generation entrepreneurs at farm-level.

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