Farmland Barometer Home » Farmland Barometer January2012 » Heartland Outlook
Agriculture is experiencing incredible forces from every angle - - and they are global as well. At Heartland Ag Group Ltd., we are optimistic about our future and are watching the following key areas:
Commodity Prices
Let’s use $5.50 corn
and $11.50 soybeans as a focal point for our
future income projections.
Bushels Per Acre
Farmers will
produce positive yield increases as weather
conditions return to normal cycles.
Interest Rates
The historically low
farm mortgage rates are attractive - - but be
careful of rising rates in our future.
National Politics
2011 is a presidential
election year - - be careful. Deficit spending
and our Federal Reserve monetary policy
will be very inflationary long term.
World Population
Don’t forget there
will be 9 billion people to feed by year 2050
- - hungry customers for our farmers.
United States Economy
This big guy
can either help us out or take us down.
Our national lack of financial discipline is
alarming - - and threatening.
Sovereign Debt Crisis
Apparently on
the planet is spending more than they take
in - - a huge problem brewing.
U.S. Tax Policy
There will be a giant
sucking sound form Washington D.C. as
politicians search for money to fill deficits.
Income, capital gains, and estate taxes will
become burdensome.
Inflation
Farmland is a wonderful
hedge against inflation and our rapid rise is
signaling more inflation coming. China has
raised interest rates five times this year to
offset inflation.
Net Farm Income
We see a solid future
for net profits from farmland that will drive
farmland values upward into our extended
future.
Investor Demand
Agriculture is
enjoying the movement of money from soft
assets (financial investments) to hard asset
(farm real estate).