Normally, I read stories about midwestern farmers being myopic or whiny, grasping, transfer-payment-consuming small businessmen. However, the one in Thursday's Wall Street Journal was different.
Instead of the typical subsidy theme, this one featured a dynamic, heads-up Iowa farmer, Mr. Nelson, who epitomizes how innovation can occur, even in something as commoditized as corn farming.
He has already forward-integrated into ethanol production, capturing value with production plants. Additionally, he uses financial futures aggressively to hedge his production income.
To me, this is real progress. An operating farmer who is able to respond to market dynamics, move to add more value than simply growing crops, and use available derivatives and insurance vehicles to manage his income more smoothly.
If someone can do this in corn, and move from being a victim-like farmer, to one who takes advantage of market changes to add more value, then I believe it demonstrates that such behavior is inherently achievable in any product/market.
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