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ND farmer makes farm bill decisions for the last time before handing operation over to sons

HOPE, N.D. -- Al Juliuson is in the process of signing up for the Agricultural Act of 2014. This will be the eighth multiyear farm bill of his career.

Sign
Juliuson Farms was started when Al and Corlis Juliuson of Hope, N.D., started farming on their own. Today, their sons Jeff and Lucas are with them in the operation, which has operated under nine multi-year farm bills. Photo taken Dec. 14, 2014, at Hope, N.D. (Forum News Service/Agweek/Mikkel Pates)(Embargo to Dec. 23, 2014, 1 a.m.)

HOPE, N.D. -- Al Juliuson is in the process of signing up for the Agricultural Act of 2014. This will be the eighth multiyear farm bill of his career.

"This is probably the last farm bill I'm going to be impacted by as the owner-operator," Juliuson says. "I'll be renting my land to my kids when that time comes, going from being an owner-operator to an owner."

For this farm bill, more decisions will be made by Jeff, 36, and Lucas, 30. Each has his own separate operation.

"We're all going to have to make our decisions," Jeff says.

Considered together, Juliuson Farms encompasses about 6,500 acres -- a mix of owned and rented land. The three share machinery and raise wheat, barley, corn, soybeans and edible beans. On top of that, they custom plant and harvest another 1,500 acres for a handful of neighbors in the area.

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3 waves

Linsey Bauer is the Farm Service Agency county executive director for Steele County in Finley, where the Juliusons will sign up for their farm bill programs. She says traffic has been steady as farmers update bases and yields by the Feb. 27 deadline.

The offices will handle a second wave of farmer elections into either Price Loss Coverage or Agricultural Risk Coverage -- on either the county or individual level -- by the March 31 deadline. A third wave of traffic will come in the annual enrollment for the programs, which will run mid-April into June or mid-July. This year, that enrollment is covering 2014 and 2015 crops.

Officials in many states, including Minnesota, South Dakota, North Dakota and Montana, have been holding informational meetings to give farmers plenty of access to the options and to computer-assisted models to make decisions in a timely fashion.

Joe Burgard, a marketing specialist with Ag Country Farm Credit Services based in Jamestown, N.D., has been discussing the farm bill in meetings since February.

"If you can increase your yield by even one bushel per crop, you want to do that," Burgard says. "If you can increase your corn base, that's the king, because of ARC-county. Canola is king also, because it's probably going to have a pretty healthy payment on the PLC. Soybeans is second, the queen, because payments are possible, but will depend on the final county yield."

Craig Schaunaman, FSA state executive director for South Dakota in Huron, says there have been numerous local meetings, and 17 more are scheduled throughout the state into early February.

Debra Crusoe, Minnesota Farm Service Agency state director, says the agency will be conducting 74 informational meetings statewide. The FSA is working in conjunction with the University of Minnesota Extension Service officials who work through computer tools for farmers, backed up by FSA officials on deadline and policy details.

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"I think it's been a good collaboration between us and Extension," she says.

A boost for corn

The 2008 farm bill was important, but its governance period will be remembered most for the explosion in the price of corn, Al Juliuson says. The price change was, in part, supported by corn ethanol, but also fueled by a major drought and other world demand conditions.

The Juliusons will remember the outgoing Food, Conservation and Energy Act of 2008 for its five-year disaster programs that covered weather-induced losses, including the Supplemental Revenue Assistance (SURE) program and the Average Crop Revenue Election program, which they collected payments from twice.

"When you have an opportunity to sell corn in the $6- to $7-per-bushel range, most people geared up their farms for more corn," Juliuson says. "That's what we did."

During the farm bill tenure, the Juliusons were able to lock in profit for three years at a time.

"That gave you comfort for expanding," he says. "All you had to do was grow a crop."

The Juliusons expanded some farmland, but also expanded technologically. The safety net allowed them to expand to two drying systems and double their grain storage to 250,000 bushels, drying more than 3,000 bushels an hour. They added to their propane storage capacity, handling semi-loads of propane at one location.

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The bill had steadily improved on crop insurance as a safety net. In this past year, for example, the crop insurance was set in the spring at $4.56 per bushel, and the price is averaged through the month of October, based on the December futures. The price came lower, so the Juliusons got 28 percent more bushels.

"I had 100-bushel corn, but the new guarantee for a claim is 127 bushels," he says.

Navigating the bill

The Agricultural Act was signed into law Feb. 7, 2014. There are no payments for the 2014 crop year yet because they're based on market year averages.

The Juliusons are trying to digest it all. They belong to a Tri-County Marketing Club and expect to be talking with neighbors and cohorts. Luke says there is information available on-line and they've attended some informational meetings.

Jeff says both ARC options -- individual or county -- could be good.

"It's a question of which one is going to help more," Luke says, adding it's hard to pick them right now. The programs carry large differences -- ranging from $5,400 in payments in a given year on a 300-acre farm to $45,000, so the decisions have consequences.

"I'm thinking that it looks like ARC is going to be the way to go," Jeff says. "I don't know if it's going to be ARC-individual, or ARC-county. I think I am leaning toward ARC-individual."

Al Juliuson says one of the keys is that the Juliusons grow such a variety of crops.

"If you are strictly corn and soybean farmers, PLC might be the way to go, on a national level."

Juliuson says his landlords depend on his advice.

"The ones we've rented from, we've rented from since the 1980s," he says. "On every farm I've reviewed the payment options, if it's good for the landlord, it's good for me."

'Farming changes'

While farm bills are important, often it is family timing that drives changes in farms, Al Juliuson says. He and his wife, Corlis, started farming full-time in 1976, under the Agriculture and Consumer Protection Act of 1973. He had grown up on a grain and cattle farm but was trained in auto mechanics at North Dakota State College of Science in Wahpeton and worked in that field.

The Juliusons borrowed money and started farming 1,920 acres, growing steadily to 4,500 acres by themselves. Corlis started an off-farm job at what is now Ag Country Farm Credit Services in Cooperstown, N.D., and she's still there today. Similarly, both sons took higher education training from vocational colleges in the region -- Jeff in electrical work and Lucas in construction management.

Both have wives with off-farm careers. Both have children who keep them looking toward the future.

They are hoping the new farm bill will indeed take care of so-called "shallow losses" through the insurance mechanism, but acknowledge the devil is in the details and they can't know or predict all of them.

"It really bothers me that the choice you make will go for five years," Al Juliuson says. "That's not really a fair thing because farming changes every single season."

Their biggest fear is that farm prices collapse and stay down. Younger farmers who haven't built up so much equity need protection to carry them through.

"It could even be tough with those who have been in the game for quite a few years," Juliuson says.

Having survived the 1980s farm credit crisis, he knows how difficult things can get.

Jeff and Lucas say one thing that gives them confidence is that with recent stronger farming years, they have been able to reduce their debt and update their equipment.

"I think we could get by without replacing items for five years if we had to," Jeff says. "I think we're in pretty good shape."

Related Topics: CROPS
Mikkel Pates is an agricultural journalist, creating print, online and television stories for Agweek magazine and Agweek TV.
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