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Finances
Contingency plans related to how to respond to changes in projected cash flows are also important. Given the expected drop in crop prices this fall, it would be prudent for a farm to examine the sensitivity of their cash flow and repayment capacity to changes in crop prices.
Read MoreDuring the May 3rd Federal Open Market Committee (FOMC) meeting, the FOMC voting members raised the Federal Funds Rate by another 25 basis points; making the target Federal Funds Rate between 5% and 5.25%. This Federal Reserve has consistently increased the Federal Funds Rate during each FOMC meeting for over a year.
Read MoreMost of the recent discussion involving input price changes in U.S. production agriculture has focused on fertilizer prices, which have declined during the last few months. Other inputs have not necessarily experienced this decline in prices.
Read MoreThis spreadsheet compares conventional and organic rotations over a ten-year horizon. Specifically, net returns are compared for a conventional corn/soybean rotation, a conventional corn/soybean/wheat rotation, and an organic corn/soybean/wheat rotation.
Read MoreThe Purdue Crop Cost and Return Guide offers farmers a resource to project financials for the coming cropping year. These are the March 2023 crop budget estimations for 2023.
Read MoreFarming is never the same from year to year – sometimes prices are good, net farm income is high, and other times margins are tight. Planning ahead, or contingency planning for financial hardship is important for any farm operation. How to evaluate farm financials, update financial statements, analyze performance, and when borrowing makes sense.
Read MoreA farm manager who thinks like a CFO can leverage balance sheet and cash flow information to develop accrual income, sources and uses of funds, and owner’s equity statements which can be used to ensure the farm is well positioned for the future. Join Purdue ag economists Michael Langemeier and James Mintert for an episode discussing why you should think like a CFO for your farm operation.
Read MoreThis article discussed recent trends in feeding cost of gain, the feeder to fed cattle price ratio, breakeven prices, and cattle finishing net returns. Average cattle finishing losses in 2022 were estimated to be approximately $70 per head.
Read MoreIn response to relatively strong net farm income during the last three years, real capital expenditures have increased approximately 32 percent. Whether capital expenditures continue to increase depends on future net farm income prospects as well as factors such as interest rates, machinery inventories, and machinery and building prices.
Read MoreFor many crop and livestock producers, 2021 and 2022 have been relatively strong net farm income years. Therefore, tax planning strategies will be relatively important. Purdue agricultural economists Brady Brewer and Michael Langemeier discuss strategies that maintain working capital in this episode of the Purdue Commercial AgCast.
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