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General Farm Management & Strategy
Since 2009, wealth in the U.S. farm sector has surged along with booming farmland values. Similar to nonfarm households, farm enterprises historically have used wealth to support consumption and investments when income fades. During years of low income, farmers tap their existing wealth to finance spending on capital investments such as buildings, vehicles, machinery and other equipment.
Read More about The Wealth Effect in U.S. AgricultureMany are asking whether the current prosperity in farming is sustainable. The answer is not obvious, but the following “what to watch” list might provide a useful perspective to answer this question.
Read More about Is the Current Farm Prosperity Sustainable? What to WatchFederal Reserve Bank of Kansas City Symposium, July 16-17, 2012 – Session 1: When Do Farm Booms Become Bubbles? | Rapid increases in agricultural incomes and asset values have brought back memories of previous booms and busts. Henderson, Gloy, and Boehlje (2011) chronicled previous agricultural booms and busts noting that they have often corresponded to rapid expansions and contractions of agricultural exports.
Read More about When Do Farm Booms Become Bubbles?Federal Reserve Bank of Kansas City Symposium, July 16-17, 2012 – Conference Rapporteur: Is This Farm Boom Different? | This has been a very stimulating and informative symposium. First,I will summarize the key “take-aways” of the presentations from my perspective. Then I will make some additional observations and identify some key uncertainties that are shaping the future of agriculture–“what to watch” in these turbulent times.
Read More about Is This Farm Boom Different?Although the U.S. farming sector has exhibited very strong financial performance during the past 5-7 years in terms of income generation, cash flow and debt servicing capacity, and equity accumulation, that strong performance has been accompanied by increased risk.
Read More about Investment and Financing Behavior of Farmers: Responding to Boom and Bust TimesAgriculture is a notoriously cyclical industry, and is now experiencing one of its “boom” times. Given agriculture’s previous boom and bust cycles, it is logical to ask what might be different this time – will today’s robust incomes and wealth continue and what are the consequences if they do not?
Read More about Is the Current Farm Prosperity Sustainable?Farming has always been a risky business with the returns to reward that risk available for only brief periods of time. The risk in agriculture today, particularly in crop production, is greater than it has been in the past, but there is opportunity to be rewarded for taking that risk.
Read More about Managing the Risk – Capturing The Opportunity in Crop FarmingThe best strategy is to resolve financial stress problems before they become severe. One of the most important rules of managing in times of financial stress is summed up in the simple but powerful phrase-early recognition, early resolution.
Read More about Managing in Times of Financial StressMany factors contribute to financial stress for small business owners, and farming is no exception. Dealing with lenders at such times can be an additional stress — or a way of relieving it. This publication outlines 10 strategies for dealing with agricultural lenders.
Read More about Strategies for Dealing with Agricultural LendersAs farmers, you know that cost reduction is clearly the place to begin when developing survival strategies if you are facing serious financial difficulties. But many of you have adopted intensive production systems and have already reduced costs to the bare minimum over the last several years while prices of inputs continue to rise rapidly. This leaves little room for advice on how to weather financial stress through cost reduction.
Read More about Income Enhancement Strategies for Farmers