East Central South Dakota | I was invited to a pheasant hunt up by Aberdeen this weekend. Landowner was 74, still farming, but looking for an exit. We hunted two new fields of CRP and he is looking to get the balance accepted over the next three years. His rental rate is $200/acre +/- 20 bucks. He can lock it in for 10 or 15 years and it isn't the best of land, especially in wet years. 150 bushels x $3/bushel = $450/acre. $600/acre into it, for a $150/acre loss or a $200/acre crp payment. More crp signups are already starting to happen here and one or two years of bleeding the acres will quickly get maxed out in my opinion. Look at the average age of farmers. Will the new administration, whoever it is, raise the cap on acres? The carbon folks love crp and they seem to be in control of things. (see pumping money down a hole). Remember part of this year's crop was a lot of acres. Governmental policy will once again be a major player in farm decisions. We could see 2-4 years of high crp signups and then when the trend turns commercials and suppliers will try to get an early buyout for crp acres. It is like watching the air chuck come off the air compressor hose at 140 pounds pressure. Welcome to the new world of Government being the economic engine. We have seen the whipping of the air hose before.
Do what you have to do to stay solvent the next 2-3 years because the trend will turn back with new higher highs to try to influence Governmental policy-------again. |
What’s your bottom
