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Deep state, shallow pool | It’s a new paradigm, remember! We have a new floor at $5 corn, right! Let’s all buy Million dollar combines, $500,000 tractors. Land is never going to go down so buy it now. What could go wrong. It’s not like I have heard this before. Build $700,000 shops and don’t worry about paying for it.
I’m worried more about when the price of land dips below where everyone bought between 2008 to 2020 and the banks have to mark to market below where the loan is at. I remember when the farmer lost land even when they were current on payments because the banks were forced to clear the books.
This time around the depreciation on equipment values could break farmers. Imagine a mark to market from a $500,000 combine down to $75,000 in 3 years.
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Future of grain prices
