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Senior Advisor

Re: A real game changer

I think that if farmers and landowners were ever at odds, this may well make it worse. Landowners may tend to think their tenants were giving them short shrift. And obvious concscious effort to rent far below what land is worth. Tenants that thought margins were thin before will really struggle with higher rents.

 

That being said it's hard to argue that an auction is not a good way to establish value. It might not be to our liking but it is true price discovery on a given day. Young farmers will find it tough to get started and some seasoned farmers may find it tough to stay in business.

 

BTW, I would not be a competitor at those rates even if I was younger. I wouldn't be comfortable with the risk but then that may be a product of aging.

 

Many times I have declared on these pages that our government payment were insignificant in our planning decisions. That was because i thought our maringins were extremely good at current rental rates. $25 in FSA deposits is piddling in comparison to a $1000 per acre corn crop or a $600 bean crop.

 

IT will be interesting to see how this all plays out between landlords and tenants. I hope it doesn't upset the balance too much.

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