Farm4Profit Podcast
Closing the Yield Gap: Protecting Farmers’ Profits w/ Acre Shield
Mon, 16 Sep 2024
What's Working in Ag Segment:Sukup grain handling equipment stands out due to its superior engineering, durability, and efficiency. Featuring cutting-edge technologies like commercial-grade components, innovative drag conveyors, and precise grain dryers, Sukup ensures faster, safer, and more reliable grain handling. Their equipment is designed for maximum throughput while minimizing damage, making them a top choice for both small and large-scale farming operations.https://www.sukup.com/Episode Content:Billy Rose explained how AcreShield provides yield protection by offering farmers hybrid seed selection tools based on comprehensive, independent trial data. This allows farmers to choose the best-performing hybrids for their fields and mitigate risk through AcreShield's proprietary insurance products, ensuring that farmers are financially protected when yields fall between 85% and 100% of the target.Farmers using the Yield Optimizer program benefit from a tailored approach, combining data-driven hybrid selection with financial protection to close the yield gap, ultimately boosting profitability despite external challenges.https://www.acreshield.com/Don’t forget to like the podcast on all platforms and leave a review where ever you listen!Websitewww.Farm4Profit.comShareable episode linkhttps://intro-to-farm4profit.simplecast.comEmail [email protected] to YouTubehttps://www.youtube.com/channel/UCSR8c1BrCjNDDI_Acku5XqwFollow us on TikTokhttps://www.tiktok.com/@farm4profitConnect with us on Facebookhttps://www.facebook.com/Farm4ProfitLLC/
This is a team that's been with me close to 15 to 20 years. We've built great ventures. I've been recognized as Iowa entrepreneur and many accolades. It's not because of me. It's because of the team behind me and what we're able to do and help our customers out.
Ladies and gentlemen, farmers, ranchers, and distinguished guests, thank you for listening to the Farm for Profit podcast, where we discuss the latest ideas, methods, trends, and techniques available to help your farm achieve higher levels of farm profitability. Remember, if you aren't farming for profit, you won't be farming for long.
Hey, listeners, welcome back to the Farm for Profit podcast. It's great to be back with some representatives from Sukup. We've got Randy here, the material handling sales director, and we're going to dive deep into the title just to make sure everybody is clear as to what he understands. But, no, it's a pleasure to have you back on the podcast. Welcome back, Randy.
Hey, thank you, guys. Appreciate it.
What a beautiful day to have an interview to learn more about what's available, what's cutting edge and new for farmers this fall when it comes to grain handling. But material handling in the title means it's not just corn and soybeans that souk up. equipment handles, right?
That is true. We handle a lot of commodities. I mean, we've done things from frack sand to canola to sunflower. So it just, it depends on what the farmers and the people need out there.
We were out on the West Coast. What about pistachios?
Yeah, we do some stuff with pistachios and almonds as well. So, you know, nuts to sand to grain.
Corey, how did they do that? They did so many million dollars per rib or something like that. Pistachios are a little more high value.
Yeah, a lot more high value than especially corn, right?
Especially at today's prices. So Randy, if our listeners don't remember who you are, why don't you give a little bit of background as to who Randy is?
All right. I'm material handling sales director. So what that means is I kind of oversee all of our material handling products. So that's the drag conveyors, bucket elevators. We've got triple run conveyors, distributors. all of our structures, so the towers, catwalks, those types of things.
So basically anything that handles grain and, you know, some towers and structures there to support those products.
And you've got a couple new things. Did you have the distributor last time, or is there something new with that?
So we've got a new dual-flow distributor. It's a completely electronic control. Corey, did you get that on your setup? No. It's dual inlet, so if you've got a couple, a wet leg and a dry leg... then you can dump into a dual inlet distributor and take that grain to basically anywhere you want to, even going into the same bin with it at some point. So you guys have one sitting right out here.
It's a big piece of metal. It is. It's pretty massive. We've got three different sizes, a 14-inch, a 16-inch, and an 18-inch.
Yeah, that would handle a lot of grain and provide a lot of options, too, because we've talked about the profitability that elevators have when they have the ability to blend. And Corey's already given a testament to what it's done for his farm, having the ability to blend as well.
So what problem does this solve for the guys that don't have it and why do they need it?
So anytime you've got two legs on a farm, it does make it a little easier to direct your grain where you want it. If you don't have it, it makes it kind of difficult. You've either got to use a combination of multiple distributors or some two-way valves or three-way valves after that distributor.
And the nice thing about this is you bring two legs down into it, so it ties both bucket elevators into one distributor.
So this isn't a new concept, though.
correct like this has been done for years correct yeah your first yes this is our first to market with it it has been out there for several years um you know we're just uh obviously as we're growing we're finding these needs to become more and more and this was an opportunity for us to grow and expand so in the past you would have probably purchased that from a secondary source and then
added that because you needed that as part of your whole suit of grain setup right you do you need that you need to have an option and what we found is when we did purchase them there were some pretty long and extensive lead times with them we thought hey this is an opportunity where we can come to market with something
have something just as good or better than the competition, and cut down on those lead times that people are facing.
Is this something that's built right here in the U.S. in Iowa by Shetfield, or is it somewhere?
Well, it is actually built in a facility in the Ukraine. Oh, okay. We've partnered, got a manufacturing plant there, so we're letting them build them, bringing them over here, and then we're... being able to market them here in the United States.
I can see we're building them yourself or having your own team to build them wherever it's made. It still has quality control on it. It still has checks and balances and more timely.
That's exactly right. So how long have you been with Sukup, Randy? So I've been with Sukup Manufacturing for 24 years. So kind of started off in the engineering side, on the design side. I went into sales and service, and now I kind of head up the whole product line of material handling.
So in your 24 years, is this something that you've seen happen over and over? They find a product that gets used on a frequent basis and want to add their touch and bring that quality of service to the customer?
Absolutely. What we try to do is find out what the needs are, what the problems are that farmers are facing, and then introduce a new innovative product to the market to solve all those problems.
Before we go to the next thing, I put this distributor away. That thing's way up in the air, right? It is. And you're saying electronics. Like, it's electronically. Me, as a farmer, I'm like, oh, boy. How do I service that? How do I make sure that doesn't? I mean, what does that look like?
Well, there's some gearboxes up there, you know, with C-Face electric motors on them. So they're pretty reliable. No different than what you've got probably running your bucket elevators, to be honest. And then all the controls for it are actually, you know, just wires running up the tower conduit. Controls would be on the ground. So it's basically, you never have to get up there to do anything.
It's touch-free control. Is that something we can put into our touchscreen that runs the dryer and all that?
Yep.
Very nice.
Yeah, integration's definitely leading in agriculture right now. It is. Yeah, it is. One thing that I was jealous of, having sat at the booth for years with you, is the paddle sweep. Because I've swept...
and cleaned and shoveled many a grain bins that i wish i had a paddle sweeping yeah that has been one of our fastest growing products at every farm show i've been at it's probably the most talked about thing there especially if you get somebody that um has a family member that's maybe had an accident or maybe themselves have had an accident with a traditional sweep inside of a grain bin um
Some guys come in and they're hacking and they've been in dust so long that it's just really starting to affect their lungs and their health. So when they see a product like this where it basically keeps them completely out of that grain bin and they don't have to get in there to do anything.
Corey, I've seen way more TikToks of people trying to solve this problem with robots, with shovels, with brooms, with everything. Sounds like you guys already got it figured out. It just needs to go viral on TikTok here.
There you go. I think you guys can help us out with that. You know what? I've never talked about my paddle sweep yet. Mainly because we just started using it. You know, we just got to the bottom of the bin. We should have got to the bottom of the bin a long time ago, you know, if we were good marketers. But we just got to the bottom of it. And let me tell you what. It is amazing.
We had to adjust a few things just to get started. But it is like no kernels on the ground. I mean, a few. Like you could go sweep them up or blow them if you wanted to. Yeah. And Tanner alluded to our blending deal. It keeps up, and I mean, I'm going to tell you this right now. We only have one paddle sweep, and we have three other power sweeps.
We actually didn't get back in and sweep behind the other power sweeps because we're just going to put a paddle sweep in.
I tell you what, I go to a lot of farm shows, and the best thing that I can do is stand there, talk to the paddle sweep, and I get a farmer that comes up that's got one, comes up, that's the best thing I've ever invested in. You know what, that right there,
sells the product i can step away let him talk to the the customers because they believe him you know they might not believe me but they certainly believe you're just a dirty crooked salesman that's right that's right okay for a fee we won't have cory do any more interviews we'll just have him stand next to the paddle sweep and talk about his experience what i was trying to get you on the blending side like normally if you're in the bin sweeping you're in that bin that's the bin you're hauling you're pulling from i can actually blend when we're down in the bottom and have multiple bins running because i know i don't have to sit there and babysit the thing right
Yeah, it is. It's something, like I said, when I first mentioned it, I'm very jealous of because no matter it seems like if it's in January or it's in June, that's still a job that sucks.
It is. And nobody likes it. And I tell you what, the commercial market has, you know, with the whole OSHA and zero entry laws that came into effect probably like eight, eight, nine years ago. That really changed how we clean out grain bins.
But Corey, it's a testament. It's not just commercial use only. This is for a regular farm.
Correct. Yeah, this one is meant for the farms. It's not a commercial one. I mean, we've got a commercial one out there. You know, you get some big bins, you're going to take more than just a little farm paddle sweep to do it. And we do have those large ones available as well. We just aren't displaying those here today.
Gotcha. But you don't have to have, you know, the Sucup unload system. You can actually retrofit one in, correct?
You can, yeah. So we can go into, if you've got another brand of unload out there, we do make some retrofit kits that are available. You'll have to probably call in. Now, one thing to be a little careful of is I don't know how well some of those other brands are made, so we're not going to warranty if they've got a gearbox problem or something. That's on them, not us, so...
I think we generally know that as farmers, if we're upfitting a planter that's 12 years old, that, you know, hey, you know, is we better do our due diligence, say, is the frame good? Are the hinge points good or the hydraulics, you know, all that kind of stuff. Exactly.
Now, just curiosity, the economy is kind of maybe in a downturn right now. It sounds like you guys are really busy still.
We are. I mean, there's still quite a bit of interest. I mean, you know, downpricing. usually for grain bin sales isn't a bad thing. Let's hold our grain. We need to store more of it and wait for a better day, huh? Yep. I mean, we've got to have an uptick at some point, right? We're going to have to. But, you know, the downtrend isn't necessarily a bad thing.
There are, you know, obviously people out there that still have a lot of last year's corn, so they're looking at grain bins and putting some more storage up for this year, so they've got somewhere to put that grain. So what else are you excited to talk about at the show this year? Oh, we've got a new triple run conveyor here. That's a new receiving low profile conveyor.
We've had that out for two, three years. We've also got our full heat mix flow dryer on display here. So this is I think the second show we've had that at. So definitely stop by the booth and check that thing out. That's really an innovative product with the whole mix flow drying systems available.
And then obviously all of our traditional grain handling, material handling products, all here on display and all the bins too. I mean, we've got three different sizes here, hopper bins out here, centrifugal fans, we've got everything.
So I've tapered into that triple run conveyor because that to me sounds like a misleading title. It doesn't move three different directions, right?
That's correct. So triple run conveyor to conveying system that can be used in multiple different scenarios, right? So the three basic ones are a dual receiving system.
single receiving system and then a reclaim system like underneath the grain bin where we can reclaim the grain come out and dump it right into a bucket elevator so if I could put it into my farmers terms like I see this and it's gonna be my pit right like I pull a semi up over and I can dump both hoppers at the same time that come into one
And now you got to have something that can take the grain away from that. That sounds like a lot.
It is. I mean, we can get up to, you know, we got capacity ranges anything from 4,000 to 10,000 bushel an hour. You do need to have a bucket elevator sized appropriately and the rest of the conveying systems down the line to take whatever capacity triple run you choose. We need to make sure the rest of that can keep up with it.
I'm going to say double run now, which is like, I don't know, a lot of people will call them a grain pump or something like that. Can you take enough away with that?
Yeah, you can. You've got a 12-inch double run. That's 10,000 bushel an hour. So as long as we're running that horizontal, that'll keep up with the fastest speed that our triple run's going to be able to put out. So that is an option. Otherwise, we've got other drag conveyors, bucket elevators, things like that, too, that we can use to make sure we get rid of that grain.
That sounds like the common issue our listeners have, just like you, Corey. You get an upgraded combine, but then you have to size everything else after the combine to make sure that that extra capacity is being utilized.
I was just going to ask you, Corey, not having grain bins at my house and not putting anything in there yet, what... How important is the time issue that it all matches?
When you start getting over acres and you've got to get so many acres, so many bushels a day, time is what you need. You need to be able to turn trucks, turn wagons, whatever you're doing. It's a logistics problem. right? So you need to be able to get back to the farm and only be there for X amount of minutes.
If you're there for 15 minutes, well, if you're pulling 4,000 bushel an hour out of your combine, kind of do the math there. All right, now I need more trucks, more labor, whatever, or you could speed it up and I'm only there for three minutes or four minutes.
That's right. And how far apart are your farms, right? So that's something else to keep in mind. If your trucks are
travel and quit a distance i mean it's yeah more that you you know you want to get them turned around quicker so there was a lot of firsts on our farm last year we uh it was our first we went to a class 8 combine a john deere s780 from a from a class 7 went to a 12 row head from an 8 row head got the brand new sukep dryer bin all that kind of stuff but what we didn't do and we did plan we did plan to we just ran out of money uh was the receiving side of it that is now our pinch point so
Now we rent an extra trailer, try to get an extra guy, have a third truck, when normally we could have done it with two. Well, you're at the right place. We've got a lot of stuff out here, Corey, we can hook you up with. Still a lot of money. I'm putting you to work.
Remember, you're going to go stand next to the paddle sweep, and you're going to work on commission there.
There we go. So, Randy, for a guy that doesn't have grain bins but might eventually invest in them, there's lots of options. Just like I sell farmland, there's lots of options to sell your farmland. I'm going to put you on the spot.
Why Sukup? Why Sukup? That's pretty easy. Okay, we're a family-owned company. Every product that leaves our facilities, it's got their name stamped right on the side of it. So we want to make sure we've got the most innovative and the highest quality product on the market today. So you don't find that with some of our competitors, right? They're owned by banks, investment firms.
They're traded on the stock market every day. So, I mean... When your name's on something, you want to make sure your product resembles your name very well.
That's right. So if our listeners want to inquire about products, how best do they look you guys up?
So the best thing to do is get on our website. It's www.sukup.com. We've got all of our literature, all of our brochures out there. Take a look. We've got a dealer lookup there. You can go in, punch in your zip code, take you right to your nearest Sukup manufacturing dealer. I love it. Thanks again for jumping on with us. Hey, thanks, guys. Really appreciate it.
Yeah. It's time for a Nitrogen News Minute. I'm happy to have Taylor Ferguson here, Nutrient Maximizer Strategic Account Manager. Welcome.
Thank you very much. I appreciate it.
I love how you're bringing benefits to our audience. You are trying to maximize their nitrogen application, making sure that it's all going to be here next spring. We've already talked a little bit about what applications we can include the products in on. You last gave us a little tip on how we are going to make sure our equipment's ready and what weather we need to be paying attention to.
What do we need to think about next?
I think the next big thing that we really need to be thinking about as growers, or at least from a grower perspective, is to really have that overall realistic goal. And that's going to be a yield goal.
So we want to make sure if you look into the future as best as we can right now with the way commodity prices are, the pricing of nitrogen and everything like that, how can we maximize that overall amount of nitrogen that we are investing a lot of money into? in the economy and the market that we're going to be going into in 2025.
And so when we build an actual solid plan of how we're going to reach those specific yield goals that we have, it's really going to set us ultimately up for success to get more bushels in the bin at the end of the season.
As we do these segments in the fall, that doesn't mean that this is the only time or the best time for your operation to apply your nitrogen, right?
Correct. Yeah, we have a lot of flexibility. A really big highlight of that fall application is extending your workload essentially at the beginning of the year. We don't have to really run and gun. If we get all of our nitrogen put on in the fall, we can kind of have some time to get everything in the ground, corn, seed-wise, in a timely manner without having to overlap all of our work.
So if our listeners want to learn more about Instink and Inserve, how best do they do that?
Reach out to your Corteva AgriScience territory manager, local retailer, or go to nitrogenstabilizers.com.
Thanks for joining us, Taylor.
Thank you.
Right, we get to have an exciting conversation about innovation in agriculture, and I think that's one of the things that is the important reason we're here with John Deere.
We get to have these conversations, provide us the opportunity to share with our listeners some of the latest maybe tips, tools, techniques that are going to help their farm either make more money or protect them on the downside. And I'm excited here to introduce who's become a friend of mine over the last couple of months, Mr. Billy Rose.
He is chairman and CEO of a company that I think is going to become a household name within most of these farm households. Welcome to the podcast.
Tanner, Dave, it's a real honor to be here today and talk about what we're doing and just kind of discuss how our battle cry even came about.
And we're talking Acreshield today, but Bill, you've been in agriculture for... for quite a while now. Give me your back story. How are you involved with agriculture even prior to Acreshield?
It's a pretty fascinating story. My dad used to build hydraulic fittings and sell to John Deere. Okay. And the buyer lived in Dyersville, Iowa, and his plant was in Chicago, and he was fighting the union. And only as Iowa could do, he was explaining to the buyer in Dyersville, the John Deere buyer, hey, you know, we're a little behind because of the unions. We've got a little strike going on.
And they said, why don't you come back next week? So my dad drives back, sits down, and he's looking at a, cornfield. And they said, why don't you build your plant here? We have the banker, we have the tax benefit, and we'll actually help you get the plant built. Lo and behold, he comes home and says, we're moving to Dyersville, Iowa.
Ties back to Iowa. I thought you were going to say, lo and behold, he didn't build the manufacturing plant, he built a ball diamond.
No, you know it. That came many years later. In fact, my bus... ran past the ball diamond before there was a ball diamond, twice a day, every day. Truth be told, I maybe kissed my first girl and drank a beer on that road. There you go. That's awesome. Love it.
That was Billy's field of dreams. Yeah, there is your tie to agriculture right there.
I'm going to maybe have to claim the fifth now.
Yeah, there you go. Plead the fifth. Oh, that's cool. So that's the base. But then how did you grow up and get into the business and entrepreneurial spirit that you're in?
Yeah, so as the, you know, As my dad was building the company, the early 80s came up, and the interest rates went to double digits. So I'm graduating from high school, and his advice to me was the following. Whatever you do, go to college and don't get into ag. But what had happened at the same time was a couple of our friends with their family farms, they lost their farms.
Double-digit interest rates, it just ate them up. And I was scarred for life. And I didn't realize until probably 15 years later after we built two successful companies helping farmers profit and thrive that my wife said to me, you know, Billy, the reason that you have such passion is you were scarred from that, you know, your friends going bankrupt.
And I then committed my whole life to, hey, if it's not good for my friends in Dyersville, Iowa, and it's not going to help our farming friends survive, mitigate this risk, then why are we doing it?
Yeah.
And so, thus went to college at Iowa. The first company we created was a company that provided operating loans. Okay. Okay. We did about $140 plus million worth of operating loans. We also did great marketing advice. We also became, back in 1996, when the CRC revenue insurance came out, that was the first way to do a revenue protection policy. Gotcha. And we built that company, sold it to DTN.
I woke up, said I'm too young to retire, so what am I going to do next? Serial entrepreneur is what we have. And with that, we said, what if we could improve the crop insurance delivery system? And so we went to the USDA. We laid out a plan. It was back in the Internet days, and we said we could use technology, efficiencies, and we could pass a savings to the American farmer.
USDA had great fortitude. They approved the plan. We saved American farmers over $50 million just by using technology efficiencies. Awesome. Yeah. Wow. So we grew that company to $300 plus million, sold it to Farm Bureau Mutual. It took us 12 years. Yeah. But it was a hell of a run. Wow. Yeah.
So you have had this passion from the beginning as you've built all these companies.
Yeah. You're trying to protect the margins of the producers. And in today's environment with these... bumper crop coming out, commodity prices going to all-time low for a cycle that we don't even like to talk about, right? I mean, I would rather just bury my head in the sand, but we can't. We have to deal with this, and we have to look at it and go, all right, I've got a good operation.
I've got a 220 APH on my corn. You know, I'm doing everything right, but I'm not making money because of those commodity prices. So how are we going to do better? And we've always seen this issue of this problem called the yield gap. And at the right time, I'd like to talk to you about that yield gap.
Oh, it's perfect time. What is the yield gap? Sounds like a clever term for something. What's the back meaning behind this?
Yeah, so we named it this gap where crop insurance doesn't cover, but it's the last 15% from 85 to 100 of your historical yield. Okay. Okay, so it's this gap. And you can't get any coverage, yet that gap, is the difference between a profit and loss. Yes. It's the difference between going on a vacation or not. Yep.
It's the difference between, can my wife, you know, stop working in town and come work on the farm? Yeah. And so we said, this problem, this universal problem for 160 million acres of corn and soy, how could we solve it? And for years, we couldn't. And one day, we started doing all the seed trials across the Midwest, testing every variety and hybrid on these seeds.
Sea trial plots, where we had specialized four-row planters and combines, and we got the scientific data. And I have a question for you guys. If I planted 100 different varieties in the same field, okay, side by side, same plant date, same environment, same harvest date, what do you think on a normal 200 APH corn field we might see in yield difference just in the top 30?
I'm going to let Dave answer because I know the answer.
You know the answer? Yes, he does. Oh, man, you wouldn't think it's more than 30 bushel an acre if they're all in the same environment, same, but technologies have come a long ways and hybrids have come a long ways.
So 30 bushel is 15% is what you're saying. Yeah, 15%. We were finding up to 20%. That's just in the top 30. There you go. So imagine if we could bring this information back to our farming friends where they just drop a pin on their field and this, you know,
AI algorithm goes out, compares all the seed trials, brings them all in, grabs the same soil, same maturity zone, same practice, same rotation, whatever you're doing, and says, here is a list. I call it the David Letterman's top 10. Okay. Here's a list that if you buy off of this top 30, you're going to improve your yields by that 15% to 20% and solve your yield gap. Okay. Okay.
So, Dave, you're first field, right? You picked a hybrid because one of your friends told you to plant that hybrid.
We actually did, too. So we're doing a little testing ourself on that. And that was based on the advice, of course. Of course, we have seed salesmen. And I relied wholeheartedly on the seed salesmen that... I don't know what I'm talking about. He looked at soil samples, same as your maybe AI algorithm would.
And he went based off of what the book tells us, and the book tells us based on trials, just like what you're doing. But that's one company, one variety. You're covering the gap.
Yeah, so now take it to, and let's say you're brand loyalists. Let's say you're loving your DeKalb and your Pioneer or your Wiffles. We even allow you to sort by those and do side-by-side comparisons. And our new Yield Optimizer, which is the name of the tool that's coming out here in 2.0 this fall, we're going to allow you to take your favorite, Dave, plug it in,
and do side-by-side comparisons to understand the why.
I'd be curious to know how many of current customers already have the correct one on there. So let's say I drop a pin, and you're like, oh, turns out you already have one of the top ten. What percent of the population out there of acres are already on the right track? Because they've done it for years. I'm assuming that they got it somewhat right. Exactly. We don't know yet.
Okay. Because we signed up a bunch of farms, a lot of progressive early adapters and ROI farmers last year. Okay. And right now I just talked to one of them on the way in this morning. He's running 255 plus. Okay. That's good. Okay. And he had nothing but a big smile, and he said, Billy, now work some magic and get those prices back to $5. No kidding. Okay?
Your yield optimizer is going to have to become a price optimizer next.
And it might be a price deficit, so think about this. One of the reasons that our commodity prices are lower is because we are so good at producing, right? Take us back. Remember we talked about that curve in hybrid selection, okay? So we go back to, like, 1950s, and we did not produce nearly the bushels that we produce today.
Now, let's say we're already producing 220-ish, and then you come along, and you're like, oh, hey, knock me up to 250. All we did was do a better job creating more. Now we have that much carryover. Does the price go down?
Well, it potentially would if everybody starts doing the same thing. But that means everybody's got to be doing that. That's the same thing as this technology curve you've seen in hybrid selection. But if we have 10% of the farmers running the yield optimizer, 10% of the farmers are going to have the yield advantage based upon this model. But I did like your question.
What a great feeling you would have is if you dropped your pin, pulled up their tool, and all of a sudden your seed guy gave you the best hybrid option within that. How much more confidence do you have in that partner? Correct.
But let's add a twist to it. Okay. Okay. You know, I have 10 guys come down my lane. Every day, 10 different salespeople, and they're all trying to say, try my brand, go with my hybrids, trust me. Does any one of them ever say, I will guarantee up to five times what you pay me that if you don't get these yields, I'll write you a check?
I don't know anybody that does.
Guess what? Well, you must need to work on your seed dealer a little bit.
Well, apparently. He did give me a pocket knife, Phil. So, by golly, I mean, I'm in.
So, what we did is we worked with the world's largest reinsurance company. Okay. And when they saw our algorithm and saw the performance, and they back all these other crop insurance companies. Okay. We're not a crop insurance company. We're a commercial performance guarantee. All right? And we embedded this guarantee into the yield optimizer. So...
We are saying to you, we're so confident that if you follow our tool advice and you don't yield over 100%, we're going to write you a check for up to five times what you paid us for the yield optimizer, which starts at $12 up to $20, which is $100 in acre protection.
So let me play devil's advocate for just a second until we get a challenge. Everybody's process being the podcast interviewers here. What if I wreck my truck five times? Guess what? My insurance goes up. It sure does. Right? So let's say that, hey, it didn't work, and I made a claim and a claim and a claim, and now all of my friends made claims. What happens? Okay.
Well, first, great question, but we have to change level set here. Okay. We look at your 10 years of historical production. Okay. So we benchmark off of your certified yields. Okay? So we're going to use, you know, my average is different than your average. And we do it on a farm level. This is not betting on the county. It's not going to Vegas going black or red. Okay?
This is based on your operation. So you might be running 180. You know, Tanner's over there running 240. I'm at 210. Of course. I would be far exceeding what I'm doing. So that eliminates that potential for fraud. Okay. Okay? And, however... The unique thing is, you know, your dad's been doing things or your grandpa's been doing things a certain way, certain brand, certain numbers.
And, you know, there's a lot of pressure on you, especially when you're under break even to perform. So why would you even change unless you had the confidence of a backstop? Yep. Okay. And that's what we provide.
So every farmer I know, we're here at Farm Progress, right? And we're 2024. Every person here is looking for the next best thing that maybe helps them. But what I see farmers do, they're very hesitant to change anything. So I got this 80 acres over here, maybe even 20 acres over here. How's that work with your program? Do I put my whole 5,000 acres in or do I put my 40?
Yep. We do have a requirement by county that you enroll all the corn and soy acres in that county. You don't have to give us all. But if you're in one county and run 1,000 acres, you can put 1,000 acres into the program. The concept there is that We then true up, and it's called an enterprise unit. We add up all your acres, all your expected production against your benchmark, and it's very simple.
Were you above 100%? Get this. We give a dividend, like farm credit gives a patronage dividend. We give a dividend for 10% of what you paid us if you're over 100%, because you won and we won, right? You tried our seed selector. It clearly got you results over 100%, and we're saying, good job, and here's our way of giving back to you.
It's finding it hard to lose. I mean, I understand this is a cost service that our listeners are going to, if they're interested in using, it's going to be an additional cost. But it comes with that backstop, the ability to guarantee that yield gap. And also, you just talked about a dividend. So just like you said, if I wanted to test and maybe switch hybrids on a field, I now have the data.
And maybe I do more than 20 acres and I put it into 80, which ends up being a better investment for me. And I end up doing it in 300 of my 1,000 acres because I've got the test plot data. I want to go back to how you talked about the test plots because that's the data that's going to matter. Dave says it all the time.
Data is the currency, and you can't have funny money when you're trying to make decisions.
No, and a lot of people don't realize to do test plots correctly. I mean, we grew up and we always did our little test plot too. But when we have a protocol and the standards that actually the largest seed companies follow when they do their test plots. So we have the specialized software, the equipment, the staffing.
We have close to $5 million worth of equipment just here in Iowa running those seed trial plots throughout Iowa and the surrounding states. And that allows us to do a true side-by-side comparison. The best way to test a hybrid is put the two next to each other and say which one produced.
So let me challenge your process one more time. And that is, as a farmland sales guy, I look at soil maps all day long. And so I'll have a silty clay loam over here, and then I'll have a Webster and a little bit of Nicolette here and a little bit of this. And so what John Deere does for us is variable rate. So I can do variable rate. I can plant different hybrids in certain areas.
You're testing this on a small scale. You have a four-row combine or four-row planter, and I've got a combine here that's doing 12 rows at a time, and we're bringing in thousands and thousands of bushels. Can this scale, or is your sample data too small that you were only on the silty clay loam? You never ventured over here into the Nicolettes, and you never ventured into the sandy clay loam. Yep.
How does that work? Great question. We're running 250 plots across the Midwest. Okay. So the algorithm goes out and goes sandy to sandy, loam to loam. Loam to loam. And let's compare those results, and then let's organize it, Very easy for the farmer just to look at the list, and then they can stress test it. They could change the maturity ranges. Let's say you have a late planting, right?
And they're watching, you know, how many times have you been right prior to planting, and the seed company calls up and says, you know, I'm really sorry, Tanner, but that number we sold out. But trust me, I have a really good number here. Really good number. This happened to me. Where'd he go? Where'd he go?
So, you know, I want to trust you, but let me just look at my yield optimizer real quick and go, how come you didn't recommend this one of your particular brand? See, we have all the brands and all the hybrids.
Well, Corey, we had Todd Dillon here from Estes Concaves to talk to us about getting our combine set for wheat harvest, small grains. Yep. Let's do the same thing for soybean.
Soybeans are tough. I mean, it's one of the toughest crops to set a combine for. When the beans are ripe, I mean, if we're being honest, a lot of the time, concaves are on cleanup duty. They thresh so easily. So much is done by the drum of the feeder house, the header drum, feed accelerator. Like a lot of the beans are already threshed. At that point.
So there's much less of a taxing job for the concaves and rotor to do when the beans are dry and ripe.
Yeah, that does seem like we always get into a point mid to late harvest of soybeans that they're just drier than you want them to be. And they're shelling at the head and they're hitting the windshield and all that kind of stuff. So I imagine you kind of maybe back off on your tightness and speed once you get to that point.
That's tough. The best thing you can do for yourself there is run your reel as slow and unengaged as you can. Your reel on your header. Keep it up high or out of way or whatever you can do to minimize that initial shatter from the header. You just got to minimize the contact up front and at least get them into the auger or the belt, whatever kind of header you got to help it out.
But when it's at that point, yeah, a lot of the time you could set a concave to 20 or 25 and a rotor speed of 400. And that's going to be sufficient to do the threshing and separation just because they're ripe and ready. It's time to cut them.
If our listeners want to learn more about the XPR3s and what you guys have in store, how best do they look you up?
Just probably Google Estes Concaves. I mean, it's going to be, it'll pop up and everything. Our website's estesperformanceconcaves.com. Get started on the investigation process if it's something you want to move forward with, and then give one of us a call. We've got phone numbers listed on there. We'd be happy to talk with you.
Awesome. Well, thank you much for your time. And here's a question I have for you. Where do you think the shelf life is? Of soybean hybrid is? Two years. Two years. So that means every two years that I have to trust my seed company and seed dealer to recommend what's the newest greatest. Okay. Right? Imagine if you had pre-commercial data.
I didn't know you had access to that.
I don't know. You know, it's just good things to think about. So what about this? So you have an algorithm, okay? So we have an algorithm, if this, then that. If this soil type, we know that our database says that. If this, then that. But there's a whole lot of variability. So now this one's on a 9% grade. This one's not. This one's pattern tiled. This one's not.
This one is in Indiana, not Iowa, and they get this much less rain than this. There's got to be other factors to your if this, then that formula. So in your algorithm, are there other factors that you can share?
Great question. Sure, Kevin. We actually, down to the field level, have 20 years of the weather data pinpointed on every field. So right away, that's going to tell us what type of maturity zone he's in, what type of historical pattern. And you can override it by changing your factors and just say, look, we're looking at a drought.
So I'm anticipating a dry year versus we're looking at excess moisture. Maybe you're more interested in the racehorse versus the workhorse. Maybe you want to compare those two together. We actually have a report that after the seed ranking, then you can mine in to understand the why. Okay. The why is very, you know, I'm supposed to believe this algorithm, right? I'm supposed to believe AI.
I'm supposed to believe data. I want to. But the why that we're now explaining about rotation, environmental, pH levels, whatever it might be, helps you get a little more comfortable with the recommendations.
I was about to say, if we have data and we're a data forward farmer. And so I already have 10 years worth of records, but not just APH. I use this hybrid this year, this hybrid the next year, this hybrid, here's what I've put on. How much does that help your algorithm? Because now you know what I produced from this 80-20, whatever it was, corn. Does that also go into the formula, the past data?
I'm guessing you can sharpen that pencil.
Oh, yeah. We have 15 million acres over the last 10 years of every yield. Gotcha. Okay, by field. So that goes into us helping establish a benchmark. What's fair? If you didn't change any of your practices, you should come in around your average. Gotcha. Excluding environmental impact.
Yeah, that's the fun part when we got to talk to you down at Tech Hub Live. Corey was trying to shoot holes in it too. We're both very good at challenging. Dave's almost better than we are at challenging the process. And so far, I appreciate the answers that you've given because one of the things that we were talking about is how wet this spring was. Oh, mercy.
And if you were planning on planting corn and it just didn't end up working for you and you had to go get a bean hybrid, just like you said, The seed dealer might not have access to all the bean hybrid choices you did at the beginning of the order season.
And I even switched to my replants. I got a shorter window for replants because my seed dealer recommended it, you know, putting it out there. But, all right, so we are farm for profit. Yep. Amen. How much does this cost?
Great question. And we actually built a new business model. Okay. We are not insurance. We are a commercial warranty. And by operating under those regs, we were able, because remember, I built two insurance companies. Sure. We were able to save 50% of our overhead. Okay. Now, did we pocket that? No. We go back to our roots in Dyersville, Iowa. When I go back to talk to my friends, it's like, look.
Billy, what's this cost? We start off at $12 up to $20 for up to $100 protection per acre. That's just amazing.
Say it again because that is amazing.
Yep. You can go to AcreShield's website. We work through trusted distributors, which are crop insurance agents, bankers, seed dealers, agronomists, anyone that has a good farm gate relationship. And podcasts, of course.
Oh, of course. Geez. You're a trusted advisor since five years ago. Since five years ago.
You're in good hands with all this. You got it. Let me show you what that looks like. All right. It starts at $12 for this year. It goes up to $20 with a 5X protection. If your 100% APH even falls 3%, you get your money back. Look at the risk. That's zero risk almost.
So have you had customers pairing this with different crop insurance guarantee levels? Sure.
Because the crop insurance, Tanner, as you know, ends at 85%. You can't get a higher level than 85%. So from 85% to 100%, quite frankly... You're exposed. We specialize in covering that risk mitigation from 85 to 100. So with that $12 that you buy for the seed selector comes the embedded performance protection.
Here's a question that I get often asked from people not in agriculture. You guys are getting paychecks in the mailbox, okay? So you just said that they are taking a 15% risk from 85% to 100%. If you buy 85%. Yeah, if you buy 85%. Let's pretend I'm a contractor. I'm building houses. I have no insurance to say that I'm going to make any money building this house.
Let's say I'm a guy that owns an auction company. I have no protection. Why do farmers get 100% protection and the rest of the world just has to fake it or make it?
You know, I have to say I'm very proud of the crop insurance. In 1981, it was privatized. It was a mess when the feds were running it 100%. It was about $200 million. Today, it's almost $18 billion. Holy smokes.
Okay.
And, yes, you and I as American taxpayers are subsidizing the cost of crop insurance up to that 85% by 50% for farmers. So it's a very smart buy. Okay. Now. We can't open up a donut shop and buy an insurance policy that's going to guarantee the revenue, right? Guarantee me the Krispy Kremes are going to be good. But the beauty is that this is available to every farmer.
I've been on a 20-year mission to take advantage of the crop insurance, forward price your crop when you can, lock in your profits. Take the basis off the table. This is a penny business. It needs to be run like a penny business. Awesome. I'm not saying I don't like it. I mean, I like it just in terms of... But it's there, and it's not going away.
The farm bill is just going to actually maybe bring out greater subsidies.
So, Tanner... I want to keep staying on the crop insurance topic for my next question, that we could buy up to 85%. Have you had clients that are buying lower crop insurance coverage... And use you for more. Because of... This, being able to partner with it, are they able to buy down to 70% or 75%?
That is their decision. They can buy it. You know, it starts at 65%. Most guys in Iowa or the Midwest buy 75% to 80%, a lot of 85%. We are covering what I call like AFLAC, the gap, you know, that 85% to 100% that no one's covering. But we're doing it smart. We're saying, hey, we're going to give you the inside knowledge on the best performing hybrids.
Yep. Dropped to 75%. All day long. Might still only have 10% risk. A little band. Out there. Right. But I've insured another 25 on top of that. Or 15. I'm sorry, 15 on top of that.
Which is higher, closer to the flame, right? Because you're closer to 100. Yeah.
So that could be a way for our listeners to save a little money and not give up a lot of risk protection.
I like to be net neutral, right? I'm only going to spend my X dollars per acre. but I'm going to maybe spend it differently.
Yep. From an ag lending standpoint, so Tanner, you've been in that game. They're always looking for security. They want no possibilities that we can crash and burn. So oftentimes, even lower commodity prices, they lower what your balance sheet is and what stuff is worth to make sure they're protecting their backside. Does this affect their lending game on the operations side?
Absolutely. If you can guarantee revenue, you're going to get credit for it. If you've already got bushels sold, I'm going to give you the sold price versus the current market price, whether the price is higher or lower. At least that's the way I would operate to make sure that we had an accurate depiction of what your crop was valued at.
I mean, I just sold a farm, and even the lending institution on that one wanted to make sure that we had a lease agreement, not with the guy who bought it, but with the tenant. They wanted to make sure that they got it before the guy who bought it, which I was just blown away with because it hasn't happened in the past, but on this one... It sure did.
There's probably going to be a lot of financing questions, Billy, coming up here in the next six months.
They're protecting their backside.
Having some AcreShield protection is going to be beneficial in those conversations.
Then we go back to car accidents. Are we going to pay out like every farmer in the world and then does the company crash?
Just said, then they all win. Right. And when you look at When you really look at your risk mitigation, the things you can control, the things you can't control. We can't control the weather, right? We can't control your seed selection. You can't control your fertility programs. You can't control certain things like that.
What we look at is like, all right, I need a little hedge on the things I can't control. We're providing a little hedge on that yield performance. And right now, with the prices being so low, If I'm not popping 110 of my historical yield with this bumper crop out there, I'm below break even.
You know, if I'm renting ground. Especially, yeah. So one other thing. Our listeners, and then I'm done with questions, are small and big. So we've got big guys, and I wholeheartedly see this definitely work for the big guys. If you farm 5,000, 10,000 acres, we always say that you're farming more acres, you're farming more expensive equipment, the margins just got tighter, and there's more risk.
Now you're taking the risk out of it for them. So for the big guys, it makes sense.
How about the guy that farms 200 acres? All day long. We do not discriminate. We built this program. He still has to make a seed decision. Maybe he's working in town, but he's still running that farm. He has exposure. He can buy the same program for the same price and get the same intelligence and protection.
Yeah, I've had this conversation with Billy a couple of times, and Corey's had it once before. So I appreciate your perspective on trying to make sure our listeners who get their first exposure to AcreShield have a good base knowledge as far as this goes. But I've known Billy longer than just AcreShield, and he's constantly innovating. So I want to know what's down the pipe.
Yeah.
What's coming down the road?
This is exciting, actually. We can't disclose everything, but I can tell you this. We've been asking every one of our farm customers, you know, today we're doing seed trial testing. What would you prefer us to do next? We're giving them three choices. Seed treatments... Fungicides or biologicals? You're just sharpening the pencil. You're talking.
But we want to provide unbiased, raw performance data. Okay. Okay? What do you think they're picking? It's a two-to-one between... What do you think? I know the answer. What do you think? And give me the... Seed treatment. Yep. Right? Which has a big impact on yield. Biologicals and fungicides. Yes.
Oh, man, it's got to be biologicals. It is. And why do you think it is that? Just because that's the most buzzword I've heard for the past year and a half. So if all the industry is going that way, it's what's top of mind, and that's what's top of mind.
And what has the least amount of research unbiasedly associated with it.
And, you know, we want to believe, okay? We want to believe all the biological companies, and there's some great ones out there. But I'm here to tell you there might be a couple that are not great. But if there was a company out there that was independent, that wasn't selling biologicals, that could actually start. So we applied for our license, and we're going to do biological testing next year.
Awesome. That was hands down the most requested for us to start doing next. I think we need to read.
We get it. It's the most requested of us. The number of companies that want to advertise with Farm for Profit that are a biological company by nature.
But there's lots of them.
I know. Oh, yeah. Yeah, we've turned them all down.
We're going to rename Farm Progress Show.
making the statement right here it's a million ways to spend money that's what it is so there is a million you're gonna call it the farm for profit show there is a million ways to spend money at this show right here and everybody's claiming that they can help me somehow as a farmer from decision making to profitability etc etc and we get the opportunity to interview a lot of them which is pretty fantastic it sounds like you have a uh taken the risk out yeah
You can never remove all the risk because you always have the cost of the risk vehicles that are sunk into it. But what we're really trying to do is like... Kind of like being married.
Never take the risk out of that.
I'm just saying.
Be smart here, Dave.
Be smart. They take 60% of your assets nowadays. But on a serious note, I'm really proud also of our team. This is a team that's been with me close to 15 to 20 years. We've built great ventures. I've been recognized as Iowa entrepreneur and many accolades. It's not because of me. It's because of the team behind me and what we're able to do and help our customers out. Perfect. Two more questions.
He's going to give the final one. I've got four questions to go. Nope. We're ready to go. He's warming up. I'm following his timeline, which I don't normally do. But here's the deal. What are we missing? So we've asked you. I've challenged your process. Is there more to this that our listeners need to know that you want to tell them?
I don't know. You owe it to yourself to check this out. Now, bankers, crop insurance agents, seed dealers, anyone that you have, we're signing them up as distributors. Full disclosure, we do pay them up to 15% commission. So if you bring in your crop insurance agent, he owes you a steak dinner. Okay. All right. But these guys also give our farming friends a little more vetting.
Because they look at AcreShield, they go, oh, you're backed up by an AM Best A-plus reinsurer superior. That's the best rating you can get in the world. So they do some of that due diligence that I always like my stockbroker to do. And that's what they'll do. And then at the same time, they can make a commission by helping their farming friends solve this universal yield gap problem.
So are you looking for more of those partners? I am. I'm looking for more distributors. We're signing them up every day. We don't want to lay three distributors in the same little town. We're looking for geographic spread. We operate in all 15 Midwest states. So now I've come up with another one. Good.
I've got to go there. Well, you said two in your last one. Well, you were going to ask the last one, see? The payoff. But all crop insurance agents get the same product. So it's really about relationships. It's really about who you trust and where you go because I get the same rate everywhere we go. If I had to choose between one that had acre shield and one that didn't.
Now, does it set you apart as a crop insurance agent?
Well, considering you're talking to a man who built and sold a crop insurance company, I think he knows that's a competitive advantage.
I think it is. It's a great way to differentiate your offering. And what I like is we make our distributors the heroes to the villain called yield gap. So we're trying to help our farming friends solve that problem. And at the same time, our distributors get to be the heroes to deliver the solution.
Remember that sign years ago? It was the yield bump. They had bumping hands. We need like an image for yield gap.
Yeah, how could we do that appropriately? I don't know. Well, Billy, this is something that you and I have talked about doing for quite a while. And I'm glad we got to do it in the environment that we did. The energy here is second to none. whether the audience sat and stayed forever or it's 95 degrees outside. Yeah, not quite 90 degrees yet. Still warm.
So put you literally on the hot seat, and we're going to do that with our last question. We like to frame up and try to put a summary together to help our audience with things that they're struggling with, and one of that is knowing that they are doing okay as a family man or just in life in general. So how do you juggle the activities of work and personal life?
I used to have a shirt that my wife gave me 20 years ago when I was getting out of balance. It was called Balance. And every now and then, building a venture, you're all in. She would give me the Balance shirt. But subsequently, we now have changed that word from Balance to Circular. And what I mean by Circular is that, look, she knows that it requires 80 hours a week.
It requires 80 hours sometimes when you're in harvest or planting, okay? But I also come back and give back to the family. I still believe in I have date night with my wife. We just became empty nesters. The last one went off to Iowa a week ago. Libby's off and running. And, you know, we're going through that change ourselves. But it does take a really good partner to support you in a venture.
And I'm blessed to have a wife like that.
That's why this question doesn't have the word balance in it.
we've chosen to use the word juggle because i don't feel it needs to be 50 50 no it does not work and it might be 60 40 for one person and flip to 60 40 for the next so you only juggle two you got two in the air at same time i got i'm juggling like 45 i mean there's like there's a bunch in the air because i only got two hands that's right but do you do you ever let me ask you guys a question do you feel like this is work not today
Not today. Not today. Sure, it's hot, but look at the fun people we have met. I've seen a bunch of old friends, met a bunch of new people. This is what we live for. Plus, Tanner buys me lunch. I am getting hungry. I'm ahead of the game here. I'm net positive for the day.
I think there's a beer later, and it's on his credit card.
We'll be at the same time. All right. We're there. That's good. Thanks again for hanging out with us. If they want to learn more about you guys, how do they do that?
They can go to acreshield.com. They can call our 800 number, which is, you know, 888-650-CROP, okay? And we encourage, you know, people to give us a jingle. We'll send them the information. We'll walk you through how it works. And the only thing that we ask is one simple thing. Tell a friend. You know, help someone else out.
Yeah, that's the same thing we ask of our listeners. We appreciate them at all times. They can always send us guest ideas just like you, Billy, and we encourage them to tell their friends, so. Thanks again for hanging out with us.
We appreciate it. It's an honor, guys. Thank you. Keep up the good work.
Remember, if you aren't farming for profit, you won't be farming for long.