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General Farm Management & Strategy

Fall 2020 Crop Outlook Webinar

Recorded September 11, 2020 | Purdue agricultural economists Michael Langemeier and James Mintert discussed USDA’s September Crop Production and World Agricultural Supply and Demand Estimates (WASDE) reports.

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How Much Debt Can a Farm Carry?

There are numerous factors impacting a farm’s debt holding capacity.  It is important to remember that financial leverage or debt directly impacts a farm’s growth rate through its effect on expected returns and risk.

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Working Capital: What Is It and Do You Have Enough?

Maintain your working capital!  This phrase is commonly heard in discussions with lenders, advisors, and management specialists in today’s environment of relatively low crop net returns or margins.

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U.S. Farm Sector Balance Sheet

Since its peak in 2013 at $123.7 billion, average U.S. net farm income has averaged $82.7 billion or approximately 33% less than the peak value. This article discusses changes in the U.S. farm sector balance sheet as well as liquidity and solvency ratios.

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Conventional and Organic Enterprise Net Returns

This article uses FINBIN data from 2015 to 2019, to compare crop yields, gross revenue, total expense, and net returns for conventional and organic alfalfa, corn, oats, soybeans, and winter wheat.

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Computation of Deferred Tax Liabilities

Income tax liabilities arise from differences between balance sheet values of certain assets and liabilities, and the tax basis of those same assets and liabilities.  Deferred taxes reconcile the tax basis of balance sheet assets and liabilities with the basis currently being used to value assets and liabilities on a balance sheet, which is usually market value.

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Farmer Sentiment Rebounds as Commodity Prices Rally and Agriculture Trade Prospects Improve

Purdue ag economists James Mintert and Michael Langemeier review the results from the August 2020 Ag Economy Barometer survey, a nationwide monthly survey of 400 ag producers. The barometer and its two sub-indices all posted their most positive readings since February 2020 when record highs were established and before the pandemic began.

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Using Vendor and Trade Credit for Farm Purchases

Purdue University agricultural economist Brady Brewer is joined by Purdue Agricultural Economics graduate student Chad Fiechter and Kansas State agricultural economist Jennifer Ifft to discuss issues surrounding vendor and trade credit in the agricultural finance sector. There has been a lot of growth in farmer use of vendor and trade credit as terms and conditions…

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Statement of Owner’s Equity

This article is one of a series of financial management articles that examine financial statements and financial analysis.  In this article, the components of a statement of owner’s equity are illustrated and described.

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Sources and Uses of Funds Statement

A sources and uses of funds statement, often referred to as a flow of funds report, provides a mechanism for reporting how a farm’s performance during an accounting period influenced and was influenced by major funding activities.

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