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Tidbits, About New Crop, SA Estimates, Broilers & Ethanol, Markets & Rain Days Update 1/6/23

About 2023 new crop

Justin asked: "What’s your 2023 new crop recommendations? Will u be putting those out soon? Or do u wait until old crop recs have been filled? I’m fairly new to your program so just asking. Thanks."

We will begin tracking new crop beans and corn outlook after the January 12th S&D with the final 2022 production estimates. We do not want anyone pricing new crops until they know their cost of inputs. Inflation of farm supplies and machinery in the 1970’s resulted in producers, who contracted corn and beans in the winter at prices never seen before, lost money several consecutive years because input prices just kept going higher. Old duffers in the farm accounting and ag lending business will tell you as a group, farmers could not pay off their operating loans year after year in the ‘70’s. USDA and IRS numbers say the same.

You ask, “How did they keep farming?” Farm land values were increasing 25 to 33% every year and lenders said, “Short on your OL? No problem! Your farm land increased in value more than enough to cover that operating loss. We’ll just roll that loss into next year’s OL.”

When farmland values declined 70 to 80% from May 1980 to May 1984, 100% of the six years of operating losses and 80% of the farmland loans all came due.

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