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Nw Iowa | Reality, Very interesting, funny how a year changes things. I expected market to correct, didn’t see corn unraveling all in Feb. Suddenly no big government payments, high interest and huge carry outs.big machinery payments, high inputs. I am guessing some of loss depends upon when they did cash flow last year? Early ones last year probably worst than later ones? First ones this year better than latter ones? Quite frankly the big federal crop guarantee stopped a lot of forward contracting that would have taking place if price was closer to 5.25 than 5.91. It was hard to forward grain sales when grain price was under guarantee. Not a normal situation. I know I didn’t handle it very well. I guess tax planning will be easier for 24. I think new machinery prices are going to have to correct, there is just no way that current prices equate to 3.50 or 4$ corn and 8%.. Land prices are still a open market, so will correct as buyers back off, machinery prices are set by mfg and they will have to give. I bet you start seeing some big incentives on equipment coming even if list price doesn’t move. How are you handling machinery inventory depreciation? If your customer never raised them than not so bad but 3 or 4 major large purchases and you have other parts of balance sheet to deal with besides cash flow.How do you handle Real Estate? Purchase price or market value? Interesting times. | |
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This article doesn't scream they all paid cash"
