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Farm Business Management Update, October 1998

Guides to Managing Feed Cost Risk for Livestock, Dairy, and Poultry Firms by Wayne Purcell ( Grain prices are at or near historic lows. This low is a dark cloud for grain producers, but there is a silver lining for feed users. Corn and soybean meal costs can be pegged at very favorable levels, and dairy, poultry, and livestock firms should be taking advantage of these low prices. This article outlines the various strategies that could be used and describes how to set costs for the next two to three years by "rolling" long hedges in futures forward. It is an excellent opportunity, and we should not let it pass. This publication can be found on the VCE Internet site at:

Management Practices on Virginia Dairy Farms by Gordon Groover ( presents the results of a survey of dairy farmers to determine their use of intensively managed pasture grazing as a source of high quality forage. Respondents were divided into three groups: confinement (no grazing), moderate grazer (4 or more days rotation), and intensive grazer (3-day or less rotation). In general, intensive grazers had smaller average size herds, less pound of milk per cow, less debt, more education, higher use of computers and written nutrient management plans and written farm plans/goals. However, fewer used milking parlors, automatic takeoffs, total mixed rations, DHIA, and rBST. More than 10 percent of Virginia dairymen use management-intensive grazing for their producing cows and over half of the respondents plan to increase their reliance on grazing. The study did not address changes in costs. To obtain a copy this publication, contact the REAP office by phone at 540-231-9443, by email at, or read the publication on-line at:

The Economic Impact of Migrant, Seasonal, and H-2A Farmworkers on the Virginia Economy by Paul Trupo, Jeffrey Alwang (, and R. David Lamie ( describes the economic contribution of these farmworkers to the economy of Virginia. Their contributions to the economy include approximately $4.5 million annually in federal dollars entering the state; $5.7 million annually for spending related to house and transportation for them; $67.6 million annually in wages; $49.4 million of the wages spent in the state. In addition to these direct effects, their presence adds about 15,600 additional full-time equivalent jobs; $460 million from crop production compared to a next best alternative; $323 million in value added; and $170 million from tobacco stemming and redrying and canned fruit and vegetables sectors. If these workers were no longer available, some farmers who use them would sell their farms; others would turn to alternative enterprises. The entire agribusiness sector as well as the local economy would feel the impact of the loss of these workers. To obtain a copy this publication, contact the REAP office by phone at (540) 231-9443, by email at, or read the publication on-line at:

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