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Multiple enterprises help young grain farmer with cash flow, networking

If grass grew under Eric Towle's feet, he'd find a way to market it. But the young Murdock, Nebraska, farmer would never let so much time pass. He's busy year-round in 4 sideline enterprises along with 750 acres of corn, soybeans, alfalfa and wheat.

The growing season finds him driving his sprayer. In August and September, Eric bales wheat straw to sell to hardware stores and other retailers. By October and November, he's in the combine. In the fall he's also taking back some 150 Angus bulls that he and his grandfather, Gayle, rent to farmers in a 150-mile radius. And, he's taking orders for the seed he sells.

0406fff001.jpgAll this hard work helps cash flow. Rental payments on the bulls help finance planting. At harvest, crop receipts help buy replacement bulls. Eric can't self-finance everything. He borrowed from a local bank to buy his first 45 acres of land in 2006. He borrowed from Farm Credit Services of America and the Farm Service Agency to buy another 80 acres in 2008. He rents the rest of his land.

"The lenders love that I have 3 or 4 sources of income," Eric says. "I have to look at things every year and ask if it's pulling its own weight," he says. Some enterprises may help support another. "That's natural -- as long as it isn't always the same one."

0406fff01.jpgEric began baling straw at 14 and raising grain in 2001 when he was a junior at the University of Nebraska, majoring in ag economics. It was a half-hour drive from Lincoln, and Eric was able to schedule morning classes. "My dad helped a tremendous amount. They'd get things organized, and I'd come out in the afternoon and help until late at night," he recalls.

After college, he bought a self-propelled sprayer to use on his own and his dad's farms. He began buying into the bull rental business Gayle started in 1960. Gayle started selling bales of wheat straw in the 1950s. Eric joined in at age 14. At first Gayle and Eric sold to the Ak-Sar-Ben horse track in Omaha. When it closed, they sought new buyers.

0406fff02.jpgEric has grown the business. In some years the wheat straw comes from his own farm. But he contracts with neighboring farmers who grow wheat every year for most of it. He sells about 10,000 bales a year to 25 businesses.

"Land is not easy to come by, so I expanded the things I had potential in," he says. And he didn't have to invest much. He uses the same baler his family has had for 30 years, an unloader of the same vintage, and a 1977 truck. "My grandfather told me, 'Don't ever let pride get in the way of profit,' " he says.

0406fff02.jpgEric sets his price for bales, one that's higher than the going rate for bedding. Others have tried to undercut him, but he's kept his customers by emphasizing service and reliability. His most recent new enterprise, selling seed, came about when a member of his college fraternity, Alpha Gamma Rho, contacted him about taking over for a sales representative who had died.

"It was something I was willing to try, and the product had a presence in the area," he says. "The downside was it wasn't an easy road. I had to take rejection. It took a few years to gain the customers' trust and confidence. Support from family is critical."

0406fff03.jpgEric's wife, Rhonda, has her own career, working as a speech language pathologist. Rhonda plans to get involved in farm women's groups, too. Eric is also grateful for support of multiple generations of his family.

He rents land from relatives. His still shares some machinery with his dad. His dad and grandfather have offered valuable advice. "They're dedicated to keeping the family business going through generations," he says. "Without Dad and Grandpa's help, there's no way I could do this."

0406fff04.jpgHard work and family aren't always enough to get started in farming. Eric also writes down long-term goals. "Essentially, you have to know where you want to go to get there," he says. So he has his own one-year, five-year, and 10-year goals. My overall goal is to buy some farmland and support my family, and so far, I've done that."

Like most young farmers, he'd also like to rent more land in this rural community south of Omaha. His spraying business and seed sales are also good ways to earn the trust of farmers, learning from them and showing his own reliability. "The key is to treat people right and with respect," he says. Every fall he and Rhonda host a customer appreciation dinner in Murdock.

0406fff05.jpgEric also took advantage of a varied education, starting with two years of studying agriculture business and management technology at Southeast Community College in Beatrice, Nebraska. Many career counselors consider 2-year community college ag schools a great way to get a practical, hands-on education.

The Beatrice college offers good internships, too. Eric spent a summer working for Kip Tom, who farms near Leesburg, Indiana, and in Argentina. It wasn't just the chance to operate some of the newest machinery at the Tom crop farm that Eric enjoyed. It was Tom's positive advice: Don't limit yourself. Don't be afraid to make mistakes.

0406fff06.jpgEric laughs when he recalls some of his own mistakes, like trying to turn big round bales of wheat straw into small ones. He bought an old bale unroller and a manure spreader to use as a conveyor.

"We did make bales, but it was way more work than it was worth," he recalls. "And I had 100 round bales I didn't know what to do with." He sold them to a commercial seeding business that sows grass along highways. It turned out to be a good customer later for some of his wheat straw.

0406fff07.jpgWith 2 more years of education at the University of Nebraska, Eric got a degree in agricultural economics. When he returned home and told a neighbor he planned to farm, the neighbor asked, "Oh, you're not going to use your degree?" Eric sees it differently.

"I use that degree every day," he says. It has helped him understand financial statements. It has helped with marketing. His agronomy courses were equally valuable. "We've started doing a lot of variable-rate fertilizing," he says. Above all, college helped him improve his ability to solve problems.


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