Greetings everyone! I will take this opportunity to wish you a Merry Christmas, Happy Holidays, and a great New Year! I hope this finds you well and looking forward to 2020. With the new year coming, there seems to be a little more optimism is agriculture. Nobody thinks there will be another 2019 anytime soon, and very few would want one! USMCA should be fully approved shortly and the Phase 1 China deal seems to be agreed on. Economists can dispute if trade goals will be met, but they can’t dispute these deals will be good for the American farmer.
The land auction I wrote about a few weeks was on Dec.16. We bid, but we were unsuccessful. Farmers quit bidding around $7,000 to $8,000 per acre. Two investors battled it out from there. The 221 acres brought 2 million dollars, just more than $9,000 per acre. The tracts included some woods (with minimal current value), some flood plain, and a couple of ditches cutting through the farm. Definitely not a ‘Class A farm.' None the less, the investor will probably receive about two times the bank rate of return as I’ve seen certificate of deposit specials running between 1% and 1.4%. Few farmers could make that farm cash flow, especially if they had to borrow some money to complete the purchase. However, the sale will certainly give a boost to the balance sheet.
Late last week I received a phone call from one of the local news stations. I almost didn’t take the call as I don’t take very many calls when the name doesn’t show up on caller ID. They wanted a farmer’s take on USMCA’s impact on the farm. I’ve had the privilege to do a few of these interviews over the years. I try to never turn them down. The reporter was trying to make the deadline and leave for vacation, I didn’t have a lot of time to prepare. So I made a couple of phone calls, did a little research and gave the interview. Anytime we can put agriculture in positive light, we should take the opportunity to do so.
We hope to enjoy some slower times this week and next. Mild weather will certainly temp us to drill down on some of the remaining outdoor tasks, but with the holidays in the middle of the week, many businesses will be closed. Traveling to family events will also force the slow down. My brother is home this week and our kids are certainly excited about seeing him. Once January hits we will be in full ‘go mode’ again, between officiating, the kid’s sports and school, and prepping for 2020, there won’t be much time left for other things.
The opinions of the author are not necessarily those of Farm Futures or Farm Progress.