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Is this the start of another global acreage boom?

An ag economist says global harvested acreage is expanding and with higher farm profits, this could be the start of another acreage boom.

David Widmar with Ag Economic Insights tells Brownfield total harvested acres of the 13 primary crops has increased by 45% or 740 million acres since 1960. He says there were two big acreage booms in that time frame, one in the 1970’s and one from 2003-2013 during the China ethanol boom. Then there was another uptick in world harvested acres last year.

“These acreage booms typically take place when profits are really strong. Now we are up some $30 million acres. That strong profit signal is still going to South America and other parts of the world and we expect this to continue for at least a few years.”

He says looking ahead, an acreage boom is a “catch 22” because from a profitability standpoint the industry wants the good times to continue, but…

“The longer the expansion continues, the more risk we might have for one day reaching this overproduction standpoint, which is what we had during the 1980’s.”

He says it is also important to recognize that different regions and crops were impacted in previous acreage booms so that is something to keep an eye on in the coming years.