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Some Thoughts on the Current Investment Climate By Benedict T. Palen, Jr.

If I were a prospective seller, I might take advantage of “an offer I couldn’t refuse.” If I were writing a check to buy a farm, though, I might just want to keep that money in the bank until I saw how all of this settles out. <br>

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Some Thoughts on the Current Investment Climate By Benedict T. Palen, Jr.

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  1. Some Thoughts on the Current Investment Climate By Benedict T. Palen, Jr. There have been some serious headwinds in US agriculture over the past 3-4 years, including lower farm incomes, large carryover stocks of grains here and around much of the major producing areas of the world, and unfavorable trends in the costs of most crop inputs. 

  2. Some Thoughts on the Current Investment Climate By Benedict T. Palen, Jr. All of these factors beg the question of what direction a prospective investor, or current landowner, should take with respect to US farmland.    The answers are not easy to ascertain.   However, some distinctions can be made.   

  3. Some Thoughts on the Current Investment Climate By Benedict T. Palen, Jr. The tariffs are, however, an entirely different story.  They have the potential to adversely impact the world market share of certain grains for US farmers, and that is likely to mean that competitors, whether South American or eastern European countries, will step in and pick up the slack.  That could mean long lasting negative impacts will be felt in the US.   Many lenders and farmers are expressing concern, and the government’s so-called “aid” to help US farmers is nothing more than borrowing money from one government pocket to put it into another for distribution to farmers.

  4. Some Thoughts on the Current Investment Climate By Benedict T. Palen, Jr. There can be a fine line between being opportunistic, and cautious.   Here, at this time, we have the added factor of several billion dollars of dry powder from institutional investors looking for farmland deals in the US.   Each situation is different, and of course there will always be those publicized farmland sales that are suggested by some as evidence that the market is “strong,” or “stable.”   From the perspective of someone who has been in this market for 40 years, caution is the byword.  

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