As personnel at the Kansas City Federal Reserve report on economic simulations regarding farmland values and interest rates, the issue of a land value bubble and comparisons to the boon times of the 1970’s and the corresponding crash of the 1980’s are abundant in the press. There does seem to be agreement that a bubble might not have the same devastating consequences due to the lower debt amongst farm operators.
However, a group particularly vulnerable to a bursting land value bubble is beginning farmers. Obtaining land for a beginning farmer often means taking on substantial debt, which holds the potential to cripple operations if land values burst, interest rates rise, and commodity prices fall. Elizabeth Williams at DTN is taking a look at the effects and dangers of rising land values on beginning farmers and finds advice from the farmers themselves. Read the full article here.
Part one of the two part article addresses land access, an issue for which landowners are very well suited to assist a new farmer, as well as making connections with retiring farmers, using off-farm income, and different ways to access equipment.
Click here to find out more about leasing arrangements that can assist beginning farmers and watch a video on the benefits of renting to a small, diversified farmer.