Recently I was in Springfield, IL, Gilbertville, KY, and Martin, TN, conducting seminars. The moderator of the Farm Bureau conference in Springfield asked the 400 participants two interesting questions. First, how many of the producers were having the best production (corn and soybean) year ever? More than half the producers raised their hands. I can concur with this. Along the way from Minnesota to Tennessee, crops look outstanding. If we don’t get an early frost, what will this do to prices?
The second question asked was how many producers were contracting part of or their entire crop. This time, about one third of the producers raised their hands. Again, producers are becoming better marketing people and taking a more proactive approach.
The third view as I travel across America is that the economy is difficult to analyze. This recovery in the general economy is not creating new jobs. If it is, they are low paying jobs in the service-based sector. Productivity is going up, however technology and jobs moving off shore to our global competitors do not bode well for long-term sustainability.
Finally, long-term interest rates are starting to creep up. Watch for land values to flatten out. Every time interest rates go up 1 percent, 200,000 homeowners fail to qualify for a home loan.
I’ll be in Texas for the rest of the week teaching at a banking school. It sure is nice to not have to hurry back to Blacksburg in time to teach class. It’s much more relaxing not having to take crazy late-night flights home. Oh, the joys of retirement!
My e-mail address is:[email protected]
Editors' note: Dave Kohl, The Corn and Soybean Digest Trends Editor, is an ag economist at Virginia Tech. He recently completed a sabbatical working with the Royal Bank of Canada. He is now back at Virginia Tech with his academic appointment, which is teaching, extension, and applied research.
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