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| "Non-farming buyers don't really make any difference....they can buy it, but if they aren't going to farm it, then it's still in play for the existing operators in the area to farm. "
That's true enough, but, in large, what happened was that we got farmers pushed out by urbanization that were willing to pay 2-3 times what the land was going for a year earlier. And it started, "Ka-Thunk" with the change in the 1031 rules. You had guys with a 160 turning it into 1000 acres, and having cash to burn on top of that. No competing with it, so, you just watch and shake your head and do what it makes sense for you to do.
<i>The prevailing rental rate is the ruling factor for production decisions.</i>
Agreed. Prevailing rental rate used to be crop share. Now, it's a cash rental that always seems to look at the profitability potential just over the horizon. "If we can get that one good year we'll make it big." Sometimes it works out, sometimes it doesn't.
Edited by Pofarmer 4/3/2010 21:23
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College economics and the grain markets.
