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Nw Iowa | 80’s were a perfect storm of Russia grain embargo and high interest rates and easy lending. If you didn’t have a lot of debt in the 80’s at least on row crop farming you could still make or at least feed family and pay bills and break even. Things are always different but we have mid range interest rates that are no way close to 80’s. What we do have as DKO said is inflation that ismaking our ordinary expenses not so ordinary. Interest rates have seem to have topped. I think a lot depends upon corn carry out after this year, climate government rules and China. If you do a in-depth cash flow, you are going to be surprised just how much overhead we have incurred since Covid even if you are a low debt operation. So a big carry out ( cheap corn) high overhead would make us more susceptible to a black swan event. Today we are just in a correction phase of a high priced commodity market but pain is more severe because of overhead costs.
Edit, agree with below, it will be just as hard to buy it when land drops as credit will be harder to get and those with cash will think they will buy it cheaper. Generally if you were scared to buy it on the way up, you will scared to buy it on the way down.
Edited by jdironman 3/8/2024 18:02
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State of Ag Banking
