Many agricultural experts and economists have been warning for the past couple of years that we could be headed for a significant correction in farm land values in the Midwest. Based on recent data, there appears to be evidence that a reduction in average land values may be occurring in some regions of the U.S., including the Upper Midwest....More
Economic health and viability are at the forefront for many involved in today’s agriculture industry. While some may prefer to just eat ice cream and hope for improved opportunities, proactive management strategies will be required for success....More
Agriculture is in a time of transition that will affect assets, operations and people. The ag lending industry, however, is also in a time of significant transition. Similar to agriculture, the careful management of this transition will be critical; especially, as some segments of agriculture enter turbulent economic times....More
The 5 ag stories this week remind growers to check grain bins when the weather is wet, warm and humid, and to scout for white grubs in corn fields. Learn about China's soil moisture depletion, and the cause. See the decline in land values, and finally, enjoy a graphic showing just what it takes to be a farmer.
The USDA Risk Management Agency (RMA) has announced the availability of a new crop insurance coverage option that provides producers with coverage against an unexpected decrease in their operating margin. Starting in the 2016 crop year, the new margin protection plan will be available in addition to underlying crop insurance policies in select counties starting for corn, rice, soybeans, and spring wheat....More
Overall, the United States economy at halftime will grade out strong for the coasts and in the southern part of the country. Weather will of course, continue to play a large role in our overall economic state. In any scenario, however, a sense of caution is prudent in the flyover states....More
While difficult, decisions of restraint during the super cycle of profits put producers at an advantage going into this economic downturn. Many of them forward priced with a guaranteed profit instead of waiting for possible higher profits. This looks like a smart strategy from today’s perspective....More
From weeds to insect pests to disease, resistance to efficient, economical crop protection products is threatening their efficacy and raising costs for crop producers. So why do regulations or the chemical industry always seem to have a delayed reaction to resistance? A big part of the problem involves dueling definitions, suggests Tim Dennehy, manager, Global Insect Resistance Management, Bayer Seeds....More
Location and quality of land continue to be the main drivers of pricing for individual tracts. The stability of this market is maintained by a lower supply of land for sale, contrasted with a continued demand for quality properties. Farmers National Company statistics show the volume of properties for sale is down 40% over the past six months, as compared to the past two years.
A long term trend cannot be determined by two year periods prior or post; nevertheless, adjustments in profit levels appear to be settling in. Multi-year, high profits cause margin compression as fixed and variable costs increase. This is just another example of the old saying, “high profits cure high profits.”...More
In response to the latest WTO ruling, legislation has now been passed by the U.S. House of Representatives that would eliminate the COOL requirements for beef, pork, and chicken muscle and ground products; however, the U.S. Senate has yet to act on the legislation. There is considerable bi-partisan support for this legislation in Congress, especially from states that could be facing significant economic impacts from trade retaliation by Canada and Mexico....More
Since Syngenta chose to take Monsanto’s private buyout offer public, Monsanto now counters by talking to shareholders and the farm media.
I recently spoke with Mike Frank, Monsanto’s global operations lead, who stated their case for the value of this Syngenta buyout....More
In the 5 ag stories to read this week, experts remind you to be on the lookout for soybean aphids, and offer the best options for sidedressing nitrogen this summer. Read and watch testimony from the latest GMO labeling hearing, and check out a calendar for when to scout different corn pests. Finally, enjoy a list of ways you know you grew up in the country.
It is imperative in today’s world of trade risk to build up extra liquidity or working capital reserves. How much is enough depends on debt servicing requirements, and marketing and risk management plans including crop insurance....More
Even though the number of avian flu cases has waned in recent weeks, the economic impacts of the worst bird flu outbreak in U.S. history are not likely to disappear any time soon. The first turkey producers in central Minnesota that broke with the virus in early March have started to re-populate their barns, slightly over 90 days after their flocks were depopulated....More
Lower commodity prices are now projected for the foreseeable future. Those price levels coupled with high costs lead to projections of low or negative cash flows for the next several years. These low return levels will cause negative cash flows on many farms. Farmers then may choose to use working capital in meeting these cash shortfalls, leading to reductions in working capital....More
The number one risk facing agriculture is international trade, because many facets of the agriculture industry are internationally interconnected. The slowdown of emerging economies is in full gear, and the results are being observed in the re-entrenchment of prices for commodities such as grains, oil, steel and copper. The slowdown is targeted toward the flyover states, i.e. the agricultural and rural regions in the U.S....More
NCGA and ASA are concerned that a pending announcement from the U.N. World Health Organization’s International Agency for Research on Cancer will only lead to more confusion and concern about two widely-used herbicides that have been mainstays for farmers for decades. These two substances play an especially important role in corn and soybean farming as they allow us to manage weeds in a sustainable way....More
Storm clouds are building as American agriculture, specifically the grain sector, is entering phase one of the post-commodity super cycle downturn. One of the first signs of a downturn is buildup of machinery and equipment inventory on dealership lots. Another: access to short-term operating credit will become an issue as some producers fail to meet existing loan covenants....More
Farmers are increasingly scrutinized and being frowned upon by consumers for their use of GMO seed. It's sometimes hard to respond to those negative comments. Here are some resources, from Facebook pages and websites to informational stories we have written, to share with people who may not understand the science and technology behind GMOs, not to mention the benefits!
“Agriculture is the story of productivity: doing old things better,” says Mark Drabenstott, a global economist, Federal Reserve 25-year veteran. “The future belongs to those who innovate, doing better things. Commodity markets require even more risk management in an ever-riskier environment."...More
If you look back five years, what would you have said then compared to where we are today? Let’s dial the time machine back to 2010 and examine some of the hits and misses in economic projections....More
I gave a recent conference attendee an assignment to complete during his nearly two hour drive home that evening. His assignment was to come up with 10 perspectives from my speech and give them to mom to turn in when she returned the next morning. And he did. From moderation in family living cost to knowing your bottom line, that young college student picked up my tips for success....More
Heather Oden says today’s female generation can benefit from being part of what has been a predominantly male industry. “Today’s production agriculture creates opportunities for women that we did not have before. Sometimes I stand out in a meeting because I am a female. That gives me a platform to educate other farmers about my role on the farm."...More