Honored Advisor
Posts: 15,197
Registered: ‎05-13-2010

Farm Bureau, Economic Summit

I attended the Summit in Ames the last couple days and very much enjoyed the speakers, thought I`d share a few things I heard.


Michael Boehlje was my favorite, he tells it like it is, in his "professor" way. ..2 most powerful people in the world are Bernanke and Angela Merkel, not  Rothchild and Rockefeller, like I thought  Smiley Happy

China is slowing down, even more than this present 7 1/2% growth.  Because Germany/EU are in tough shape and can`t import as many trinkets, ultimately leading the Chinese to buy less of our grain.  Farmers are told "7 billion world population is going to 9 billion and all those people need fed!!!!", the problem is they won`t have the money to buy our food. 


 Dave Miller talked on his trip to the Ukraine, when the Soviet Union busted up, each villager got a couple hectares of their own.  Now, each village will take bids from bigshots wanting to farm the whole sheebang, big fields that go beyond the horizone, 48row planters that do 4500 acres before it needs folded.  Villagers that want to farm their own plot can do so, so you see a horse driven sickle mower going with (6) class 9 combines operating in the distance.  Rent is about $75/acre, if the villager wants payment in bags of barley, he gets barley in payment.  Not many roads and they suck, if a tractor(drivers make $500/mo) gets rained out, the driver stays with the machine or the fuel and tires are stolen.  No taxes are payed so if the school`s roof leaks, the renter has to fix it. Good soils, big fields but many challenges.


Moe Russell also gave management tips.  Had to laugh at John Phipps saying "you consulants give advice to farmers, like if someone wants to play great basketball, here do what Michael Jordan does".   Moe did talk about with taxes going up and land having to be paid with "after tax dollars" there could be some problems.  One of his clients farms 1200 acres, owns 400.  One landlord wanting to sell his 240, the farmer bought it to keep his land base.  That`s fine but he won`t be able to afford more, given his land base and if other landlors want to sell, he`s in a pickel.


One fertilizer guy said iowa is putting up a couple fert plants, so nitrogen will be getting cheaper (no wonder my elevator doesn`t want to refund my pre-paid N money Smiley Happy  )   N is getting cheaper and oil "fracking" has made that possible.


The last few 4, 5 years of high corn prices were an anominy because of weather, ethanol.  In the last 5 yrs 140 million new acres came into production because of high prices.  We have lost customers because of high prices and they have built relationships with other suppliers.  Our grain exports have looked in a "dollar amount" however not so good on a "bushel amount" see, if a customer buys 1million bushel @ $8, then the price goes to $4, that same 1 million bushel won`t look so good in the dollar amount.  They expect land prices to drop 40%,  ie $10,000 land becoming $6,000 land in the next 4,5 years as a result. 


Elwynn talked weather, more volatility a head next few years with there being more La Nina events.  We just finished a 20+ yr period of somewhat decent weather, now turn the page on that.  He doesn`t  predict a frost date yet, this yr has tracked 1947 breaking amount of snow in May and 100º+ in May previously set in May, 1947.  Until the dab of rain and coler temps lately `47 and 2013 were twin sisters.


Oh yeah, Nh3 is going away by 2017, no one wants to mess with it anymore.


I don`t know whose outlooks will be right and by how much, some will be wrong, there`s always Black Swans in the wings.

Subject Author Kudos Posted
This is a topic with new unread messages 0 ‎07-23-2013 02:42 PM