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02-06-2017 05:27 PM
reading over a bunch of stuff last couple of days......after reading everything......i think i've figured out something, without
coming right out and saying it.....they don't need me anymore........the market that is.
been watching the wheat market, starting to go backwards again, after a while the logical people were in control, seeing that
the comming crop wasn't so wonderful, acres down at least 3 million acres....at levels close to the turn of the century.
now seeing the french are going to have wheat (wheet) and several others......the question is kind of begging to
be asked.....do they need us out here in "non-corn" country ? How the idea of "fringe" acres got started....we produce
alot of grain, forages and livestock out here...but due to climate, wheat is the best fit. So, we are being "forced" to plant
things that are not normally planted out here...and that's just going to add more to the bean and corn pile.
so, i guess the question is....do they really need us, and our production anymore ?
i've planted sunflowers a couple of times, i always thought they were a "natural" for out here, but i can't even see how you
can get the numbers to work....with $300 a bag seed.....and half the elevators that will not even accept them.
so what are we to do ??? we need to have income from somewhere........if not the market.....the government ???
02-06-2017 09:21 PM
I'd like to see government subsidized crop insurance eliminated. That would cause an adjustment in crops grown to be those most suitable for the environment and the market. It might even mean some land is not worth what was paid for it and land prices would adjust.
All crops are based on world supply and demand now. The problem with wheat is there is too much of it. The market is saying it doesn't need so much wheat. Who is going to quit growing it? The high cost/low market producer.
A rock and a hard place comes to mind.
02-06-2017 11:53 PM
well i've never quite understood people who want to damage crop insurance, or to see land values go down.
what i've noticed about the crop insurance, is those who usually don't have a claim.....they just see it as an expense,
that has no return........they are soo blessed they always have a crop.....but what happens when they don't.
i'm going to reference rates from illinois, who is one of those lucky places.....the levels of premium compaired to
protection is quite good......care to come out here to the midwest ?
even if your rates double, you have good insurance......imagine if you had two bad years in a row......
then, the idea that land is too high.....yes, it is, much does not cash flow.......but if you remember back
to the 70's....one of the biggest things that caused problems was the devaluation of assets......
consider yourself, if half of your net worth was gone tomarrow.......how would that impact you ?
there are many other there with land loans, yes they got low interest rates......now things are not good
with low commodity prices.....but consider values dropping like a rock......
if you think that is the key, i hate to tell you but that would rip the heart out of most of the midwest.....
if you think "that's what needs to be done"......you need to take a look.....you will have no small
towns.....there will be no small farms, nor will young people be able to start, because no banker
in his right mind would loan that money, and the big outfits would just get better.....i don't
view any of that good.
i lived thru the last crisis, and have the scars to prove it........and now things are not much better,
but wanting to do away with assistance on crop insurance, or see land prices drop....
that is just plain nuts
02-07-2017 10:03 PM
I recall hearing the late economist Lester Thurow on the radio way back in the 80's saying that if modern North American farming practices could find their way to adoption in The Ukraine Valley that you could fence off Montana and North Dakota and turn them back to nature.
Not necessarily the same as you suggest, but what you say immediately brought that back to mind
02-08-2017 10:40 AM - edited 02-08-2017 10:42 AM
I' ve never had the illusion of being needed.in an agricultural sense....
There is always a replacement.
But Jim, while I totally agree on crop insurance subsidy, it should have never happened... Land prices will not come back to relationship with production as long as the Fed holds down interest rates............ that is a miss statement..... As long as the national debt holds down interest rates. The Fed has no choice.
If we do actually take the regulatory shackles off of the economy, that might realign the things you asked for. When investment becomes worthwhile elsewhere.