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Farmland still solid long-term investment

An executive with Farm Credit Mid-America says despite some softening in land values farmland is still a good investment in the long term.

Dennis Badger, vice-president of collateral risk management says a recent Farm Credit Mid-America survey showed a decline of nearly 6 percent in Indiana and a slight increase of .4 percent in Ohio.  “Most folks would look beyond the next 1 to 2, even 3 year period where profits would be low – if not slightly negative,” he says.  “But certainly realizing it is an investment in the future.”

 

He tells Brownfield while land values are holding fairly steady –the decline in farm income has farmers beginning to negotiate cash rents.  “There are other alternatives when negotiating cash rents,” he says.  “There’s options to where the profit sharing element can really come in to where the cash rent is just a lump-sum type arrangement.”

 

Badger says margins will likely be tight in the near future and farmers need to keep a close eye on balance sheets.

AUDIO: Dennis Badger, Farm Credit Mid-America

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