Hello, and welcome to spring!
As farmers and farmland brokers, few things excite us more than the opportunities and new life that come with planting spring crops and gardens. Here are a few of the opportunities in Ag and Farmland that we are seeing. We think it’s a great time to sell and or buy Farmland depending on your situation.
Late in 2020 and in early 2021 we are seeing very strong demand and value appreciation, creating both selling a buying opportunity. High quality farmland is selling $2000 or more dollars/acre higher than a year ago. Because of farmland’s low risk profile and correspondingly high overall rate of return (7-9%), land continues to be a strong investment and a great hedge against inflation. Upcoming tax law uncertainty means for sellers, the current 1031 rules and relatively low capital gains tax rates create a good selling environment! Uncertainty around inflation creates for buyers a very stable store of value.
Strong Demand for Commodities
Since October of last year ag commodities, especially corn and soybeans have been flying off the shelf, causing prices to rise to very profitable levels; we see this as a multiyear opportunity. A couple reasons are: 1. China’s renewed buying of US commodities due to trade commitments and their expanding hog herd. 2. Renewed government support for biofuels. Just in the last few days, 3 new or greatly expanded soybean crush facilities have been announced in the Midwest!
Spring is great for curing cabin fever with many activities including, making maple syrup, planting bulbs and wildflowers, turkey hunting, fishing, hiking, mushroom hunting, and getting back in the soil to plant our backyard gardens, food plots and the bigger corn and soybean “gardens” in our farm fields.
As we get back outdoors we also want to take the opportunity to be safe in our often fast-paced activities. Take the time to enjoy your family and friends and remember to also take the extra time to look around, communicate well and use the safety features included with your equipment. Let’s all work to ensure we can enjoy spring for many years to come!
Give us a Call
What’s my farm worth? Should I sell? Can you help me manage my farm? How can I buy Farmland? If you have these or other questions we are here to help; give us a call to discuss your questions and to find the right opportunities!