We begin this snapshot of the 1980s – the fifth decade of Soybean Digest – by examining back issues from January through December 1985.
The early 1980s saw a farm recession where the financial crisis affected many Midwest farmers with heavy debt loads. Tight money policies by the Federal Reserve (intended to bring down high interest rates upwards of 21%) caused farmland value to drop 60% in some parts of the Midwest from 1981 to 1985. Record production resulted in a glut of farm commodities, forcing prices down. This glut, combined with a U.S. export decline of more than 20% between 1981 and 1983 (following the 1979 Soviet Union embargo), caused farm debt to hit a staggering $215 billion by 1984 – double of what it had been in 1978. Farm foreclosures rose dramatically, and economists said more than 33% of farmers were in serious trouble – further depressing land prices. Farmers and ranchers who expanded by buying land and more during the strong export days of the 1970s were often hardest hit. And that crisis rippled across the supply chain and into rural banks and whole communities.
I remember too many sad stories of farm sales, farmers taking their own lives, even taking the lives of bankers, brough grim reality to this largest farm crisis since the Great Depression. Iowa Public Television created a good 90-minute film called The Farm Crisis.
On a more positive note, the following 1985 stories in this Part I gallery reflect cautious optimism and a renewed spirit to become a better financial and agronomic manager.