News

Ag industry continues to adjust

Farmers continue to adjust to low commodity prices in the New Year by finding ways to lower production costs.

Craig Dobbins with Purdue University says farmers are using less fertilizer and fungicide treatment and looking for ways to lower cash rent.

“As a mechanism of lowering the total per bushel cost of production,” he says. “We’re still working to find what economists would call the new equilibrium in this process. I expect the changes that have been going on for the last few years to continue through 2018.”

He tells Brownfield this will likely continue unless there is a weather event that limits the crop supply.

Dobbins says farmland value IS becoming more stable, but has continued on a downward trend.

“2017 signaled that the downward correction was continuing and I suspect that is likely to happen in 2018 as well, but the reductions are getting less.,” he says. “We seem to be moving into a more stable period in farmland values but I don’t think we’re done with downside corrections just yet.”

But, despite the trend, he says farmland continues to be a good investment.

Audio: Craig Dobbins, Purdue University