Hedging your bets?

[The Big Cowhuna]

Today it's the coronavirus, but tomorrow it might be something else. Have you all considered hedging your bets when it comes to livestock so that one disaster won't wipe out your income stream? I went all in on cattle and I'm beginning to rethink that strategy. I have other livestock, but it's mostly just for family use, other than what my wife makes and sells from their output.

 

[Locksmith]

There are people who are trying to start up businesses using drones to help map fields. They also do it periodically throughout the year to help check the health of their crops. That might be a good bet to hedge against whatever else you may do.

I don't think viruses can affect drones.

 

[Rosebud]

We try to do a few things to make income so that if one thing doesn't pan out one year, we won't be at a total loss. I think this is probably harder for larger farms to do. They usually have one major crop or one type of livestock they specialize in.

 

[Toymaker]

People been doing it for 1000s of years.

A few decades ago it was failing dairies getting into other stock.

Reality is, you cannot turn things on a dime. Jyst because its a bad year for corn, doesnt mean you should go all in on soybeans next year. Smart farmers are already "diversified" as much as they can without costing themselves. You raise what yields maximum return and least risk. If it takes 3x the land to grow product a than product b - but you make the same profit off either - unless a is more than 3x less risk - you go with b. Ditto if you yield less with a than b in the same amount of land...without a better risk ratio...you go with what makes you the most at the acceptable risk.