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Is this a good time to expand your operation?

An ag business consultant says, for some farmers, this might be a good time to expand by buying additional land.

“Sure there’s a lot of uncertainty out there,” Dennis Roddy with the consulting and CPA firm K-Coe Isom wrote in a recent blog. “But in times like this you need to make sure your eyes are wide open and you’re not missing an opportunity.”

In an interview with Brownfield, Roddy explained his reasoning.

“Land values are down a little bit, or flat in most areas. There could be some bargains out there,” he says. “There’s potentially a lot of land possibly looking to change hands as some people might be exiting the farming business—or landlords are looking to do something else as they’ve maybe seen a lower rate of return.”

Roddy says farmers planning to finance a land purchase will need to show a strong balance sheet, solid cash flow and good working capital.

“Right now interest rates are low and most banks will allow you to use other land as collateral for a land purchase, so that’s good,” he wrote. “This could be a really good opportunity for our clients to expand their holdings if the numbers tell a good story.”

Roddy works out of K-Coe Isom’s Salina, Kansas office.

AUDIO: Dennis Roddy