Thursday, December 29, 2011

Ready to Ring in the New Year with New Low Mortgage Rates!

Happy New Year everyone!

I was just reading an article from the Associated Press about how fixed mortgage rates are still near record lows. The average 30-year home loan averaged about 3.95% last week, which is the lowest it has been since the 1950s!

According to the article, "The average on the 15-year fixed mortgage rose to 3.24 percent. That's up from 3.21 percent, also a record low. Rates have been below 5 percent for all but two weeks in 2011. Even so, this year is shaping up to be one of the worst ever for home sales."

Unfortunately, because of the lingering recession, few people have been able to take advantage of these fantastic rates. Without being able to seel their current home, many people can't move on to their next home. We haven't seen that quite as much here, where home sales have dropped but not nearly as fast as in other parts of the state or nation, and foreclosure rates are relatively low.

If you're thinking that you'd like to start the new year in a new house, please give me a call at 320-894-7528 and I can help you explore your options. With rates staying below 4 percent, now is a great time to buy!

My new year's resolution could be to help you find a new home - and to sell your old house!

Have a safe and Happy New Year,
Noah Hultgren
The FarmlandMan.com
noah@farmlandman.com
320-894-7528

Tuesday, December 6, 2011

Follow up on MF Global

Wow - a day after I posted the story on MF Global and how it is affecting Minnesota farmers, I came across this story that puts it even closer to home. Again, the article interviews and quotes Minnesota farmers - some of whom are going to have to delay buying seed or farmland, which directly impacts all of us.

Here is the story written by Tom Polansek, of Reuters:

********************

http://news.yahoo.com/mf-global-fallout-delays-u-farm-seed-land-061053851.html

By Tom Polansek | Reuters – 1 hr 7 mins ago

CHICAGO (Reuters) - For the first time in 25 years, Minnesota farmer Dean Tofteland has missed his deadline to buy seed for next spring's corn and soybean crops.

With $200,000 of his money yet to be returned from the accounts of MF Global, his former broker, the 49-year-old farmer has missed a $5,000 discount for early buyers, and is watching friends and neighbors snap up the best varieties of seeds.

In the latest sign of how MF Global's failure is continuing to cascade across the commodity industry, Tofteland and other farmers who have yet to recover more than a third of their money from the bankrupt broker now find themselves in a cash crunch that risks rippling far beyond the futures market.

Some farmers have had to postpone purchases of land or equipment. Tofteland still expects to sow his 1,000 acres in the southwest corner of the state, but may have to borrow money to do so.

Still, the delay in returning billions of dollars in customer funds more than a month after MF Global filed for bankruptcy is starting to affect actual decisions on the farm. This threatens to cloud the outlook for U.S. crops, warn farmers who have been ratcheting up pressure on the bankruptcy trustee to move faster to disperse any cash he secures.

"That's pretty serious when you're raising food for the country and the world," Tofteland said.

For most farmers, the fact that their broker may have taken as much as $1.2 billion of customer money for its own use is bad enough. But the seasonal business of farming is now being disrupted since regulators still can't account for the missing funds, or even agree how big the hole is.

The chief regulatory officer for CME Group said on Tuesday the exchange was confident after more investigations that some of the higher estimates of the shortfall in MF Global customer funds were inflated. CME was MF Global's main regulator at the exchange level.

"The amount of money that we have tied up is significant," Tofteland said. "Because of this I've been delaying my seed purchase decisions."

Tofteland normally would have made his purchases at least two weeks ago to take advantage of discounts for farmers who buy early. He has avoided borrowing money in order to do so because he does not want to take on more debt but says he will consider a loan if the delay persists.

Tofteland worries his harvest next fall will suffer because the best-performing types of seeds will likely be sold out by the time he makes his purchases. He still plans to plant his crop in the spring.

DAWNING IMPACT

Farmers are among the thousands of former MF Global clients who are missing money from the brokerage. The firm run by former New Jersey Governor Jon Corzine, an ex-CEO of Goldman Sachs, collapsed on October 31 after making bad bets on European debt.

The bankruptcy had an immediate impact on farmers' abilities to hedge their crops at grain exchanges. Many had to liquidate positions or put up additional cash to meet margin calls after their accounts were transferred from MF Global to other brokerages.

Now, the collapse has begun to impact farm decisions that can directly affect output.

In Montana, Marty Klinker, who grows wheat and barley, is missing about $275,000 from his accounts at MF Global. He said the shortfall caused him to delay buying more than $500,000 worth of farm equipment, including a tractor and combine, from manufacturer Case IH.

Klinker didn't know whether he would eventually buy the equipment, which would replace older models on his farm. He said he has to decide by the end of the year to take advantage of prices he previously negotiated with the company.

Case is a brand of CNH, a majority-owned subsidiary of Italy's Fiat SpA. A Case spokesman did not respond to a request for comment.

"We're right in the middle of year-end equipment decisions," Klinker said.

FARMERS CAUGHT OFF GUARD

MF Global's collapse has not completely halted farm purchases.

Stine Seed, which calls itself the largest independent U.S. seed company, has not seen a slowdown in sales, said Myron Stine, vice president of sales and marketing.

Yet, other agribusiness professionals confirm shockwaves from the bankruptcy have disrupted plans affecting crop production.

Diana Klemme, a broker for Midwest grain elevators and vice president of Grain Service Corp in Atlanta, said one of her clients was holding about $400,000 cash in an MF Global account at the time of its collapse. The client had to delay purchasing some land because the money had been frozen, she said.

Farmers were caught off guard by the disappearance of their money because it was held in segregated accounts considered to be immune from troubles at brokerages. Several farmers said they had felt it was safer to keep cash in the accounts than at local banks.

Congress is holding a series of hearings to examine whether regulators and company insiders could have done more to prevent MF Global's failure from hurting farmers and investors.

At a Senate Banking Committee hearing on Tuesday, Senator Richard Shelby criticized the Commodity Futures Trading Commission's handling of the meltdown, saying he thought former clients of MF Global "deserve better".

Farmers worry the cost of doing business could go up permanently due to the increased risk of keeping money in segregated accounts, making it more expensive to produce crops. For Klinker, whose oldest son is entering the family business, that could mean upgrading equipment less frequently than he has in the past.

"It impacts everything," he said.

(Reporting by Tom Polansek; Additional reporting by Jonathan Spicer in New York and Dave Clark in Washington; Editing by Dale Hudson)"

********************

It is frustrating to read of this breach of trust, and how it impacts all of us. I wonder if Jon Corzine has any trouble buying land... This again highlights why it is so important to be able to trust the people you are working with. I would love a chance to work with you and earn your trust. If you are interested in buying or selling farmland, or having your farmland appraised before the next crop season, please contact me at noah@farmlandman.com or 320-894-7528.

Take care,
Noah Hultgren
The FarmlandMan
noah@farmlandman.com

Monday, December 5, 2011

MF Global

Did you hear about the bankruptcy of MF Global - a big trading firm in New York that reported a material shortfall in October of 2011? According to reports, it was the 8th largest bankruptcy in the U.S., destroying as much as $1.2 billion through the mishandling of their customers' money. While it is sad, it seems to be a common occurrence these days, that maybe people are getting used to these types of disasters. And usually, we can look at them with a kind of unfamiliar disgust since we probably don't know anyone directly affected; though we should all be disgusted as taxpayers and consumers. Anyway, the MF Global case is a little different, because it's hitting closer to home. Several farmers from Minnesota were directly affected. I saw this article today laying out more of the details and tying it back to Minnesota:

"Farms across state feeling shock waves from collapse of MF Global
Steve Karnowski - 12/05/2011

MINNEAPOLIS — The shock waves from the collapse of commodities trading firm MF Global Inc. are hitting hard across rural America, where farmers, ranchers and agricultural business owners are nervously waiting to learn how much money they’ve lost. Many of the farmers who traded with MF Global, which is being investigated over what federal regulators say is an estimated $1.2 billion that may be missing from customer accounts, used the futures markets to reduce the risks of volatile prices. Locking in prices through the futures market — something farmers have been doing for a century — allows them to plan ahead while knowing what their costs will be. Mike Mouw, co-owner of Mouw’s Feed and Grain Inc. in the southwestern Minnesota town of Leota, said his business relies on the futures markets both when it buys grain from farmers and when it sells feed to hog producers. That makes it possible for the company to plan two or three years ahead. Now, though, Mouw estimates he’s out about $250,000. “I’m praying that I get it back,” he said. Farmers, ranchers and rural businesses such as grain elevators and feed mills were among the hardest hit when they were cut off from the cash in their hedging accounts at MF Global, which sought bankruptcy protection in October after making a disastrous bet on European government debt. The number of people harmed and the extent of their losses isn’t clear yet. “This thing should not be taken lightly by anybody,” Mouw said. “This has a far greater trickle-down than people realize.” Federal regulators are investigating whether MF Global, as its financial condition worsened, tapped client funds that were supposed to be kept safe in strictly segregated accounts. They’re also trying to determine what became of the money — it’s not clear if the cash is parked somewhere or if it’s gone. Violating the rules for segregated accounts can lead to civil and criminal penalties. The chairmen of the Commodity Futures Trading Commission and the Securities and Exchange Commission said Thursday that all those affected should get back at least two-thirds of their money. Dean Tofteland, who raises corn, soybeans and pigs near Luverne in southwestern Minnesota, has about $200,000 tied up with MF Global, said Sen. Amy Klobuchar at an Senate Agriculture Committee hearing. She said his situation shows how the firm’s $6.3 billion bad bet on European bonds is being felt in small towns across America. Klobuchar, a Minnesota Democrat, said afterward that recovering two-thirds of the funds “clearly isn’t good enough” for farmers threatened with deep losses to their life savings. Tofteland said in an interview that he never imagined money that belongs to him would just disappear. “It’s like having your house burn down without insurance,” Tofteland said. Grain farmer and rancher Marty Klinker of Fairfield, Mont., has lost about $336,000, said Sen. Max Baucus, D-Montana. Baucus said Klinker got about 60 percent of his money at MF Global back, but his prospects for the rest seem pretty grim. He told CFTC Chairman Gary Gensler that Klinker trusted the system, and it let him down. “You’re absolutely right, the system has to work for the farmers and ranchers and the energy companies and all of the people that need to lock in a price, and segregation is at the absolute core of this system that’s been existent for decades,” Gensler said. But the chairman did not venture a guess about when, if, or how much of Klinker’s remaining money — or anyone else’s — might be returned. Agricultural prices frequently fluctuate due to ever-changing supply and demand, which are driven by many factors ranging from the weather to exports. Trading on the futures markets helps farmers shield themselves from the risks of prices for their products falling and costs for things such as feed increasing. Hog producers who rode out tough years in 2008 and 2009 came to rely heavily on risk management tools and were starting to lock in some pretty good profits before MF Global collapsed, said Mark Greenwood, a senior vice president and swine expert at AgStar Financial Services, which serves farmers mainly in Minnesota and Wisconsin. Greenwood estimates that about half of the hog producers his company serves have been affected, with combined losses probably more than $40 million. The 300 to 400 clients have individual losses of $50,000 to over $1 million, he said. They’re wondering if they can trust the futures trading system again — whether there are sufficient guarantees to ensure that another MF Global doesn’t happen, Greenwood said. “They’re frustrated, angry,” Greenwood said. “I think the word is disgusted. We’re trying to do everything we can to manage a very volatile industry. This was one risk we never thought we’d see.” Preserving confidence in the system is essential, because farmers who don’t trust traditional risk management tools might end up taking on even greater risks, said Scott Cordes, president of Country Hedging Inc., an MF Global competitor that is a subsidiary of CHS Inc., the nation’s largest farmer-owned cooperative. “At the end of the day it gets down to, who do you know and who do you trust?” Cordes said."

As the article concludes, trust is the key ins trong relationships. I hope those affected are able to get back what is theirs, and I hope those who mishandled the money get what they have coming.

I feel fortunate to work with people I can trust, and would look forward to the opportunity to build a relationship with you. I can help you navigate these difficult financial times - whether through appraising your farmland, or selling it for the best possible price.

Take care,
Noah Hultgren
TheFarmlandMan
noah@farmlandman.com

Thursday, November 24, 2011

Happy Thanksgiving!

Happy Thanksgiving everyone! I hope that you are able to have a safe and happy thanksgiving with your family and friends. We have so much to be thankful for!

Warmest,
Noah Hultgren
noah@farmlandman.com

Tuesday, November 8, 2011

Korea is a Growing Market

I came across this article by a colleague of mine with the Minnesota Corn Growers, talking about the opportunity we have in marketing our corn in Korea. It was written by Jonathan Eisenthal, and was published in a wide variety of agricultural publications. I caught this one in the Iowa Ag Connection:

"Korea Offers Strong, Growing Market for Minnesota Farmers
By Jonathan Eisenthal: Minnesota Corn Growers

Gov. Mark Dayton led a Minnesota trade mission to South Korea from Sept. 25 through Oct. 1. The delegation included Minnesota farmers who found that not only is Minnesota's agricultural connection with South Korea strong (it is America's fifth largest ag importer), but the prospects for growth are almost certain, thanks to the recently concluded Free Trade Agreement between the US and South Korea.

John Luepke, a farmer in Nicollet County, just north of Courtland, took part in the mission, representing Minnesota Corn Growers Association. He learned that South Korean changes in regulations affecting Korean pork producers, due to go into effect in 2012, will create an opportunity for expansion of American pork sales there--already a sizeable market.

Luepke lives with wife Lorna on the farm where his grandfather was born, which has been in the family since 1881. He raises sheep for breeding stock and produces a hundred acres of corn. He is a director of Minnesota Soybean Processors in Brewster and is a founding member of Heartland Corn Products in Winthrop. He became a director for MCGA in January this year. John had a 35-year career (1973-2008) at 3M in New Ulm, after which he joined the board of the Nicollet-Sibley Corn and Soybean Growers Association.

Here is his report on the trade mission.

I was honored to represent the Minnesota Corn Growers on the Minnesota Mission to Korea Sept. 25 --Oct. 1. Kevin Paap picked me up at 2:30 A.M to catch a flight to Detroit where I shook hands with Mitt Romney. The flight was 14 hours and flew across the north coast of Alaska thru Siberia to Korea. The plane burned 235,000 pounds of fuel. It's an hour drive from the Incheon airport to central Seoul. We drove over and along the Han River, which has 27 road bridges and 3 rail bridges. Seoul has about 10 million people but including the satellite cities the urban area totals 25 million. It is up to 60 miles across.

Tuesday: We went to the Korean War Memorial which was quite lavish and included the names of 33,000 US dead as well as soldiers from 14 other countries. We drove past a 600-acre US garrison that the city grew around. It is now relocating out of the city. We also went to the demilitarized zone. The fences with concertina wire start in Seoul. There are explosives and a tank wall to slow an invasion. We were able to enter the negotiation building so we were technically in North Korea...and their soldiers were staring at us with binoculars. On the way back we saw the Jet Bow fountain, which is a jet engine in the Han spraying 30,000 liters water per second into the air.

We received a briefing from the State Department. In 1960, the tallest building was eight stories. Now there are skyscrapers all over town, many still under construction. Economic growth was seven percent in 2010 and 3.5 percent this year. Unemployment is 3.3 percent. Medical care is similar to Canada. Most families have one or two children because of the expense of education. An estimated 80 percent of South Korea's gross domestic product is tied to world trade, partly because they only have 17 percent arable land and few other natural resources. Their main resource is the ambitious people. US products pay 14 percent tariff and Korea products pay only 2-3 percent. US products have a good image. 50 percent of their food is imported and 75 percent of their feed grains as well. Most farms are less than five acres and use hand labor and small equipment to raise rice, vegetables, fruit, ginseng, barley, soybeans, and livestock, including fish and shrimp.

Real estate in downtown Seoul sells for $15,000 per sq ft., residential space is $1000 per square foot and condos cost $1500 per square foot. Farmland is $130,000 per acre. Rice is subsidized, but consumption is down by half in the last 25 years because many Koreans are adopting a western diet. Beef and pork exports are up. Australia, the European Union, Chile and Canada are competing for market share. Their pork industry might decline because in 2012 they must stop discharging manure into the ocean.

We had a briefing at the Korea World Center and individual meetings. I met with a buyer from the largest corn refinery there. He is very concerned about trying to source non-GMO corn. The larger users of HFCS will not use sugar from GMO corn. IP follows the corn all the way to the pop can. He buys some non-GMO thru New Orleans but most is from Hungary and Serbia. I explained he would have to pay premium to buy non-GMO but he stated he has price controls on his products and couldn't pay more. In the evening we were hosted by Hanwha, one of Korea's largest conglomerates, who are interested in buying into a hog processing facility in southern Minnesota or northern Iowa.

Thursday: We met at the National Agriculture Cooperative Federation. They handle over 1,000 coops. Half of their business is financial. They charge 5.6% on urban loans and 3 percent for farmers. 50 percent of the funds are from the federal government, 30 percent is from the province and 20 percent is required from the borrower. The coops have helped increase the standard of living and have 2.4 million members. They are involved in farm machinery rentals, fertilizer, pesticide, and the distribution and retail of farm produce. Their members are not in favor of the FTA as they are afraid of being undercut by cheaper imports.

We then met with the Ministry of Food, Agriculture, Forestry, and Fisheries. They are conscious of the benefits of Ag cooperation with the US. We buy 10 percent of their exports and supply 9 percent of their imports. We export $40 billion dollars in goods, but import $49 billion dollars worth of goods from them. They stressed food and feed safety and price.

We visited Good Morning Foods (store and meat processing). They have numerous stores and have a relationship with Hormel. The USMEF rep that Gerald and I met in Washington, D.C. was there as well as a Hormel rep that lived in Austin.

Koreans will pay a premium for high fat meat.

In the evening we were invited to the U.S. ambassador's residence. I probably was introduced to 50 or more people including many Ag interests. The 3M president recognized and remembered me and introduced me to several of his executives. I also met my guests. I invited the parents of my daughter's friend and classmate from MVL High School. Her home is Seoul. I had a nice visit with Richard Ulrich (Ag consulate from the Canadian Embassy). He said pork exports from Chile to Korea are increasing because of a free trade agreement and Canada is working on a free trade agreement with Korea. Canada is the number two supplier of pork to Korea. Richard said he is friends with Kevin Paap and Gerald Tumbleson.

Friday: We traveled south to tour Taeyoung (a new grain terminal where they unload corn, beans and wheat). Cargill-Purina are major stockholders and are planning to build a soybean crushing facility next door. They can unload two ships at a time and can unload the largest ships in 4 days. They plan to handle over 100 million bushels annually and currently load 200 trucks per day. There are 15 feed mills in the area.

We visited a 60-cow dairy, where the buildings had no walls. The producer buys a complete ration at .25 lb. and receives .44 lb. for milk. He averages 26,000 lb per year, uses AI and has been to the World Dairy Expo in Madison. He uses sawdust bedding and gives the manure away.

We toured a crushing plant that was similar to one here but smaller. They also have a feed mill that produces feed for dogs, cats, pork, chicken, shrimp, and two kinds of fish.

Governor Dayton did a wonderful job representing our state. It was a good group of people in the delegation and I hope it increased good will. Other ag members of the delegation were Kevin Paap of Minnesota Farm Bureau, Doug Peterson from Minnesota Farmers Union, Kathy Skiba from Midwest Dairy Association, Mark Querna of F.I.R.S.T. (First Independent Research of Seed Technologies -- www.firstseedtests.com) Dennis Timmerman from AURI, Mark Brown of St. James representing Minnesota Soybean Growers and Brian Erickson of Minnesota Department of Agriculture."

The opportunities are great! If you'd like to discuss opportunities for your farmland, please contact me.

Noah Hultgren
The FarmlandMan.com
noah@farmlandman.com
320-894-7528

Monday, October 31, 2011

Happy Halloween!

Happy Halloween everyone!


I hope you all had a safe and fun night!

Sincerely,
Noah Hultgren
The Farmlandman.com
noah@farmlandman.com

Wednesday, October 12, 2011

Corn Supply

As harvest moves along, I saw another interesting article about food prices based on a corn surplus. There was some controversy last year due to rising food prices due to rising corn prices due to the rising use of corn for fuel. A new article from Christopher Leonard with The Associated Press seems to show that a surplus of corn this year may lead to a much slower increase in food prices; even while corn prices are still relatively high. Here is the article, which was published in the St. Paul Pioneer Press:

"ST. LOUIS - Food prices could rise more slowly next year because farmers have a bigger surplus of corn on hand than previously thought.

The Department of Agriculture estimated today that farmers have 206 million more bushels of surplus corn on hand at the start of this year's harvest. That means farmers will have 866 million bushels of corn on hand at the end of next summer, which is higher than last month's forecast of 672 million bushels.

The price corn fell 15 cents, or 2 percent, in morning trading to $6.30 a bushel. In June, corn hit a record high of $7.99 a bushel after supply levels had thinned.

The USDA also increased its estimate of next year's wheat surplus by 10 percent to 837 million bushels. In response, the price of wheat dropped 5 percent to $6.25 a bushel.

Corn is an ingredient in everything from animal feed to cereal to soft drinks. So cheaper corn could ease broader food prices. It takes about six months for higher corn prices to reach the supermarket shelves. That's because there's a long lead time between when meat companies and food processors buy their grain, and when products hit stores.

For all of 2011, the USDA predicts food prices will rise 3 percent to 4 percent. Food price are expected to increase more slowly next year, between 2.5 percent and 3.5 percent, according to the USDA estimate last month.

One reason prices will continue to rise is corn supplies remain tight, even with the larger-than-expected surplus. The 866 million bushels of corn left over at the end of next year would satisfy demand for about 25 days. That's below the 30-day supply that most investors consider healthy.
Just four months ago, analysts were predicting that corn could trade above $8.50 a bushel because of strong demand from ethanol plants and hog and chicken farmers.

In light of the USDA's new estimates, corn will likely hover closer to $6 a bushel, said Jason Ward, an analyst with Northstar Commodity in Minneapolis.

Expensive corn prompted farmers this spring to plant the second-largest corn crop since World War II. It appears that the bigger harvest will be enough to avoid a major food shortage this year."


If corn prices stay relatively high, the value of farmland will likely stay high as well. If you're interested in seeing the market value of your land, we can help you with a farmland appraisal. Please contact me at 320-894-7528 for more information. I'll be in my tractor...

Thanks,
Noah Hultgren
The FarmlandMan
naoh@farmlandman.com

Monday, October 10, 2011

Fast Harvest

This dry, unseasonably warm weather has led to a really fast harvest so far. At Hultgren Farms, we're pretty much already done with soybeans and navy beans; but progress has been a bit slower for sugar beets. Most days it's actually been too hot to harvest beets, but hopefully things will pick up in the next couple of days if the weather cooperates. We got a nice rain this weekend - not quite a half inch, but it'll do.


I saw an article in the West Central Tribune talking about local progress in the harvest. The article, written by Gretchen Schlosser, included a couple quotes from Wes Nelson, who is the executive director of the Farm Service Agency in Kandiyohi County. He said that "Yield reports on the early planted soybeans are in the 40- to 45-bushel range." Other areas to the west are reporting slightly lower yields.

Larry Konsterlie, my friend and colleague on the Kandiyohi County Corn Growers Association, also got quoted in the article. Like me, he's guessing this year will not match last year's success. "“We aren’t going to have the binbuster we had last year,” Konsterlie said. “Considering the year we had, I’ll take it.” The article goes on to say that "Konsterlie has not begun to harvest corn but has heard reports of 150- to 200-bushel yields, with the moisture content of the corn crop dropping daily with the warm temperatures and windy weather."

Finally, the article talks briefly about the sugar beet harvest. Because of the late start we got this spring, we've seen that the beets are going to be smaller than normal. According to Schlosser's article, "sugar beet yields are also variable, with producers reporting good yields from some fields, but also fields yielding less than 10 tons of beets per acre. Because planting was delayed by the wet spring, it will likely be a very disappointing year overall for the beet crop, Nelson said."

I hope that the weather cools down so that we can start the harvest. If yields remain average or above average, farm land values will at least hold steady or continue increasing. If you are interested in selling some farm land to make the most of a good ag market, please call me at 320-894-7528.

Have a good week!
Noah Hultgren
noah@farmlandman.com
320-894-7528

Saturday, September 17, 2011

Grains Council newsletter

I was recently interviewed for an article for the U.S Grains Council, written by Mike Howie.



Corn crop may surpass last year’s production
Corn harvest is underway in some parts of the United States, but most of the Corn Belt where the bulk of the U.S. corn crop is grown, won’t see harvest gearing up for several more weeks.

In the mean time, the U.S. Department of Agriculture provided an early estimate of the 2011-12 corn crop, as have various analysts and those on crop tours across the Midwestern United States. In its August report, USDA forecast U.S. corn production at 328 million tons (12.9 billion bushels), which if realized is 4 percent larger than last year’s crop and the third largest on record.

“While many of us have faced extreme drought or severe flooding, we have persevered and, through the use of improved technologies and practices, we will nearly reach the crop record set under more favorable conditions,” said Bart Schott, a farmer from North Dakota who is president of the National Corn Growers Association.

U.S. corn yields were estimated at 9.61 tons per hectare (153 bushels per acre), which was smaller than some had anticipated but crop tours throughout the Midwest support the smaller number. In fact, some growers wonder if that figure will fall a bit heading into harvest.

“Cold and wet weather kept us from getting the corn crop planted in the upper Midwest this spring, but warm weather this summer allowed it to catch up to where it should be this time of year,” said Noah Hultgren, a farmer from Willmar, Minnesota.

“We did have some heat stress but right now the crop looks pretty good, although I’m not sure if we’ll reach USDA’s yield estimate for the state. It just depends on how we finish out with grain fill and dry down,” he said. Average yields in Minnesota were estimated at 10 tons per hectare (166 bushels per acre) by USDA.

Crop analysts and others, including a delegation from China, on a crop tour across the main U.S. growing areas provided a mixed bag of numbers. There were areas across the Midwest with the potential for very good yields and areas where yields were likely going to be below expectations. A solid production estimate may be difficult to come by until harvest is fully underway.

“Over the last several years there has been discussion on and off about U.S. and global corn supplies, but in the end there has been plenty of corn to meet demand,” Hultgren said. “I’ve no doubt this year that there will again be plenty of corn to go around, although obviously prices have moved upward.”



It's fun to share my opinion with respected writers on the current crop. I'd love to share my opinion with you about farm land values, real estate appraisals, and 1031 tax-deferred exchanges as well. Please let me know if there is anything I can provide to you.

Thanks,
Noah Hultgren
Farmlandman.com
320-894-7528

Wednesday, August 31, 2011

Crop year has been a challenge

No doubt this has been a challenging year for crops, with a long, wet spring and slow planting progress. Now the ground is dry in a lot of parts of Southern Minnesota. I just saw a crop and weather report from the U.S. Department of Agriculture, saying that topsoil in the state ranked at 7 percent very short, 22 percent short, 64 percent adequate and 7 percent surplus.

The recent high temperatures and low amounts of rainfall have started to put stress on the crops, especially soybeans. We could use some good weather in the next month and a half to really bring yields back.

We haven't had much trouble with diseases so far this year. Farmers interested in more information about crop diseases that might be affecting their fields can find a lot of useful information at www.extension.umn.edu/cropdiseases.

Have a great week!

Friday, August 12, 2011

Food Prices Will Increase

Just read an interesting article today in the West Central Tribune about how corn supply is going to be a little tighter this year, which will likely lead to higher food prices. Here's the article, written by Christopher Leonard:

"Americans can expect to pay slightly higher food prices next year because of expectations that an unseasonably hot summer damaged much of this year’s corn crop. But the rise in grocery prices might not be severe because farmers are sitting on larger supplies ahead of the fall harvest, and demand for corn is falling.

The U.S. Agriculture Department estimated Thursday that the fall harvest won’t yield as much corn as first estimated. High temperatures in key U.S. corn-growing states have damaged about 4 percent of the coming yield. The price of corn jumped 26 cents to $7.14 a bushel after the report was released. That’s almost twice the price paid last year. But it’s below the record $7.99 reached in June. Corn is used in everything from beef to cereal to soft drinks.

It typically takes six months for a change in corn prices to affect products on supermarket shelves. Traders worry that grain shortages could return next year because of the damaged crops. Farmers are expected to have a surplus of 940 million bushels when the harvest begins next month, the USDA said. That’s roughly a 26-day supply of corn, slightly more than the previous month’s estimate. But the USDA said the corn surplus could dwindle next fall to only 714 million bushels — or about a 20-day supply. A 30-day supply is considered healthy.

For all of 2011, the USDA predicts food prices will rise 3 percent to 4 percent. Last month, it estimated that food inflation could slow next year to between 2.5 percent and 3.5 percent. But that figure will likely change because of the damaged crops. The USDA will release its next estimate later this month. In any case, “I think consumers can expect higher food prices going forward,” said Jason Ward, an analyst with Northstar Commodity in Minneapolis. This year’s harvest will still be larger than last fall’s harvest of 12.45 billion bushels. In the spring, farmers planted the second-largest crop since World War II. And the supply squeeze won’t be as severe as it might have been.

High prices have led ranchers to cut their orders and seek alternative feeds for their livestock, such as wheat. Ethanol producers have also cut demand “Price is going to slow down demand,” Ward said. A smaller surplus drove corn prices higher earlier this year. Global demand for corn, soybeans and wheat has outstripped production for the last 10 years. Surpluses, vital to a stable food supply, have shrunk. When surpluses drop as low as they are now, even relatively small declines in supply can send crop prices sharply higher on global commodities markets."

That's food for thought - but I hope pop prices don't go up too much!

Have a good one,

Noah Hultgren
The Farmland Man

Sunday, July 31, 2011

Low Rates, Low Activity

Somehow, mortgage rates have stayed at historically low levels throughout the summer, making it a very attractive time for people to be buying houses. Unfortunately, even though the rates are low, home sales activity has also been low throughout the summer.

I like to use local banks and lenders, but its helpful to look at rates being quoted on national sites like Bankrate.com, which currently shows rates for a 30-year fixed mortgage hovering between 4.35% and 5.35% APR, either of which is a really good rate.


Perhaps sales activity will pick up as the new school year gets closer. If you'd like to move into something new before the school year starts, please give me a call at 320-894-7528 and I'll see what I can do to help you. There are a lot of good value listings out there right now - if you are ready to move, I can help you out!

Friday, July 1, 2011

Hole in One

Hey everyone,

I hit my first ever hole-in-one last week at the island green - hole #18 - at Island Pine Golf Course in Atwater, while playing in the Aggie Open. I dropped it on the green and rolled it in from about 10 feet or so. It was a lot of fun.


I celebrated by buying a beverage for my member friends on league night at Hawk Creek Country Club in Raymond, my home course.

If you want me to get results for you on your home or farm sale, call me at 320-894-7528.
I can get it done!

Take care, and have a safe and Happy 4th of July!
Noah Hultgren
The FarmlandMan
noah@farmlandman.com

Monday, June 27, 2011

Farm Safety Net

Greg Schwarz is my colleague on the Minnesota Corn Growers Association, and he recently published a useful, thoughtful article in the Minneapolis StarTribune. He covers some great points about the importance of agriculture, crop insurance, and economic stability. Enjoy his thoughts below:

We all rely on the farm safety net
GREG SCHWARZ, Star Tribune

Counterpoint
The weather has been so wild and so unpredictable this year that it's not just farmers who are complaining about it. Here in the Corn Belt, it's been cold and damp for so long that it took us forever to get our crop in.

Parts of the Southwest wheat belt are parched, while millions of acres in the vast Mississippi Delta region are underwater. But being subjected to the unforgiving whims of Mother Nature is a central aspect of being a farmer.

Decades ago, our elected leaders recognized this fact and decided that in order to have a safe and ample food supply, we needed to have farm safety net policies in place to ensure that unpredictable weather doesn't knock America's farmers out of business and leave the country short on food.

It's the future of a key aspect of the farm safety net -- crop insurance -- and whether or not it will be viable after the upcoming federal budget cuts, that keeps me awake at night. As a business owner, I understand the importance of balancing a budget, and I hope Congress does, too.

But if Congress eviscerates crop insurance or other farm policies that are but a dot on the federal budget but are so important to our unique sector of the economy ("Farming: Of equity and evolution," June 2), then all Americans and a rapidly expanding global population would feel the pinch.
Crop insurance is an example of a federal program that provides a tremendous amount of benefit per dollar of federal investment.

For example, in 2010, for a relatively small federal outlay combined with private monies from the farmers who purchased the policies, the government was able to leverage a $4 billion investment into an astounding $80 billion in liability coverage for America's food, feed and clothing crops.
That's a $20 return on every dollar invested.

This amplification is possible because crop insurance combines the best of government and private sector to help protect farmers from adversity -- promoting a safe, affordable, ample food supply for our citizens and for the world.

The government helps farmers underwrite a portion of their premiums to make crop insurance more affordable, and the private sector provides the policies and coverage that kick in when needed.
So if disaster strikes -- whether in the form of floods or free-falling grain markets -- crop insurance means that farmers aren't thrown to the wolves and that they live to provide food, fiber and energy for this country yet another day.

This security helps farmers farm better and is a fundamental reason why America has the most dynamic agricultural sector in the world. The modern crop insurance model is a great example of the ability of the public and private sectors to partner, harmonizing their efforts and increasing their benefits.

And crop insurance is very popular among farmers nationally. In fact, more than 1.1 million policies covering 256 million acres across the country were written in 2010 to deal with risks. And when you consider that the agricultural sector produces the food that we eat, the ethanol that we use as fuel for transportation and is a significant economic engine in the United States, it seems that it might be worth protecting.

Now I understand that when Congress starts trimming the budget, everyone is going to argue that their specific program deserves protection. While I can't speak for other aspects of federal spending, I can attest to the fact that crop insurance and other aspects of farm policy work for me.
Without a doubt, they are the policies that keep family farms like mine in business and our nation food secure.

It is important to note that nearly $12.45 billion total has already been cut from crop insurance in the last several years. That's sobering news for a farmer like me, because I know how much I need crop insurance to protect myself from disaster and how important it is for farmers to have crop insurance to secure a loan.

Agriculture is one of the only industries to have already made big sacrifices to help trim budgets. And, there isn't much left to cut -- farm policies account for less than one-quarter of one percent of federal spending.

Further reductions will only weaken our country's food supplies and punish our state's workforce -- one-fourth of which depends on agriculture for jobs. The United States needs to be put back on firm financial footing. But sacrificing food security and one of the economy's lone bright spots is not the best path to get there. We'll all sleep better knowing there will be food on the table tomorrow.

Greg Schwarz is the president of the Minnesota Corn Growers Association and a third-generation Minnesota farmer who raises corn, soybeans and turkeys in Le Sueur County.

http://www.startribune.com/opinion/otherviews/123661619.html

Friday, June 3, 2011

Mostly Planted

We're still doing some planting at our farm, but I saw this article in the West Central Tribune showing that most farmers in the area have caught up in the last couple weeks.

Here are some important excerpts from the article, which was well written by Gretchen Schlosser of the West Central Tribune:

"An estimated 80 to 90 percent of the area corn crop has been planted, with some farmers already finished planting while other farmers struggle against continued rain and wet soils to get the seed into the ground.

In Kandiyohi County, Farm Service Agency executive director Wes Nelson estimates that 85 to 90 percent of the crop is in. Farmers to the east of Willmar are further along in the process, but those with land to the south and west of town are facing a slower planting pace.

That progress closely matches the weekly state crop-weather report, showing that 88 percent of the corn has been planted, compared to 100 percent last year and a five-year average of 98 percent. As of Sunday, 54 percent of the corn crop had emerged, also well behind the 92 percent last year and the five-year average of 82 percent.

Soybean progress is estimated at 25 percent, Nelson said. That ranges from farmers finished with the crop to those who have not even started on beans because they are still working on getting the corn planted.

In Renville County, FSA director Byron Hogberg estimated 80 percent of the corn and 30 percent of the soybeans are planted. Like Kandiyohi County, there is a wide range of planting progress, with those with land in the central and southern portion of the county still waiting for the rain to pass and the ground to dry out.

Tuesday was the last day for farmers to plant corn and have full crop insurance coverage. Likewise, the final day to plant soybeans and have full coverage is June 10. Nelson urged farmers to be in contact with their insurance agents to provide information on their crops and do the appropriate paperwork. Some farmers will need to file prevented planting claims while others are going to switch to early season variety corn hybrids. Still others will likely switch from planting corn to soybeans.

Getting the crop planted is just the first challenge of what could be a very difficult crop year. Demand and crop prices are high, while farmers will likely face yield reductions from the late planting and putting seed into less than ideal soil conditions. “Some of the farmers are done, but they ‘mudded’ it in,” Nelson said. “We’ve got a lot of issues now — time is just one of them.”

According to the crop-weather report, 53 percent of the state’s soybean crop has been planted, compared to 93 percent last year and a five-year average of 89 percent. Ninety percent of the sugar beets had been planted as of Sunday, still lagging the 98 percent five-year average. Progress has also been slower on vegetable crops, with 74 percent of the green peas and 29 percent of the sweet corn planted. The five-year averages for those crops are 91 percent and 59 percent, respectively."

Now we need some sunshine and warmth to help the crops grow!

Saturday, May 14, 2011

Face of a Giant Agribusiness

My blog just got published on the Huffington Post, which is a major national media outlet:



The Face of a Giant Agribusiness

According to some, I am a giant agribusiness -- the worst kind of factory farmer.



What qualifies me for this dubious distinction? Nothing except that, based on U.S. Department of Agriculture (USDA) figures, my farm falls in the biggest six percent of U.S. farms. And these farms account for the bulk of federal farm policy support.

It sounds pretty damning, which is why it is the top talking point used by opponents of farm policy looking to dismantle a system, they say, is too tilted to agribusinesses and oppresses small, family farms.

But there's a lot more to this story than a 10-second sound bite would let on. For example, the USDA considers anyone with sales of more than $1,000 to be a farm, so that six percent figure is a little misleading.

The weekend grower on the side of the road selling tomatoes from her garden would be a farmer in the government's eyes. Ditto for the young retiree trying his hand at wine-making.

Ironically, my business is probably more in line with what most of us consider a farm. It is family-run. It was passed down to me from my father and grandfather. It is a full-time effort to support my wife and kids.

And, in order to make it my livelihood, it has sales exceeding $500,000.

Again, that figure can be spun to sound really bad, since most people don't know the difference between revenue and profit. But remember, the $500,000 represents gross sales, not how much money the farm or farmer is making.

A farmer may produce half-a-million dollars worth of goods but might have to spend just as much to grow the crop, making it a break-even proposition and sometimes a losing one.

Seems odd to call these farms corporate titans, especially when you consider that the Small Business Administration classifies most businesses as "small" if their gross sales are under $7 million a year.

How much profit could a "giant corporate farm" like mine hope to generate? The USDA puts profit margins in agriculture at 10 to 15 percent.

So under favorable circumstances -- Mother Nature cooperates, market prices are fair, oil doesn't spike and you don't run into any problems like equipment breaking down and needing expensive repairs -- that $500,000 in sales could generate between $50,000 and $75,000 in profit a year, according to the USDA's estimates.

No corporate executive in his or her right mind would get into such a risky business with such little profit upside. That's why 97 percent of U.S. farms are still owned by families, not by corporations like Cargill, or ADM, or Kraft.

I recognize that some may construe this article as a complaint about farm profits or an attack on smaller farm operations, but that is not my intent.

Farm prices are way up right now and near an all-time high -- and as a result, federal spending is way down. And I know that if America is going to meet tomorrow's food and fiber needs it will take farms of all shapes and sizes.

Smaller, organic growers are part of this puzzle, as are larger, conventional operations like mine, which supply more than three-quarters of our country's food and fiber.

As Secretary of State Clinton said this weekend, "We must redouble our commitment to sustainable agriculture and food security."

She's right. If this nation is going to keep pace with an exploding global population, and if it's going to do it in a sustainable way, then responsible farmers of all sizes have to come together in supporting and encouraging technology and best management practices.

In addition, America needs to urge the next generation to to get involved in farming, despite the low profit margins and risk, to replace aging growers who are retiring.

Our farmers and ranchers are a thin green line standing between a prosperous nation and a hungry world. It's time to refocus on holding all parts of this thin green line instead of tearing it apart with manipulated numbers and disingenuous spin.

**********
I hope you enjoy my two cents - seems like many other people are agreeing with me!

Sincerely,

Noah Hultgren
The Farmlandman.com
320-894-7528

Thursday, May 12, 2011

Are Cropland Prices Really Rising?

As a farmland real estate expert, I read with interest an article in the Pioneer Press titled "Survey dispels idea that cropland prices are soaring", published on May 11, 2011. The article examines findings from Steve Taff, a University of Minnesota researcher, who looked at farmland sales from the first nine months of 2010.

Based on Taff's research, the median sales price of farmland fell 7 percent in 2010, to $3,030 per acre. Here is the text from the article, written by Tom Webb:

"In a booming ag economy, did the price of Minnesota farmland really fall in 2010?

A new statewide survey says yes. But the numbers leave room for a debate that is sure to follow in a hundred small-town coffee shops around Minnesota.

Thanks to galloping grain prices, the recent chatter in farm circles has been about the soaring price of cropland. But Steve Taff, a University of Minnesota economist, doesn't pay heed to chit-chat. Instead, he examines data from every sale of farmland across all of Minnesota, some 1,150 transactions in all.
In the first nine months of 2010, the median sales price of Minnesota farmland fell 7 percent, to $3,030 an acre, Taff found. His report was released Wednesday, and Taff knows the skeptics won't believe it.

"I think all the enthusiasm is based on a handful of sales that get repeated over and over again," Taff said. "We've got a depressed market in some parts of the state."

There are wrinkles. Regions with the most prime cropland, like south-central and southwest Minnesota, did report rising farmland prices. More dairy-intensive regions reported declines.
Plus, Taff's survey doesn't cover the final three months of 2010. Those data will come later. But the big run-up in grain prices in 2010 really didn't begin until mid-summer, so the data miss any effect.

Still, Taff knows there have been some much-talked-about farmland sales - and he can name them. An 80-acre parcel in Martin County sold for $8,000 an acre. A 40-acre parcel in McLeod County sold for $7,500 an acre, as did 80 acres in Blue Earth County. In Nicollet County, a 65-acre parcel sold for $7,000 an acre.

Those are exceptions, Taff says. Yet, they've misled landowners into thinking every parcel is selling for a record price. And that is contributing to a big drop in the number of land sales.

"People who think their land is going to sell at one of these high prices...they put up their sign, and nobody is willing to buy it at that price," Taff said. "So they take it off the market. We see kind of discouraged sellers, in some respects." 

The full report is available at landeconomics.umn.edu"

After getting a full read of the article, it's easier to understand how farmland prices could be going down - the context is key. Land prices appear to be declining in the northern parts of the state; while they are still going up in our part of the state. In west central and southwest Minnesota, prices are remaining high.

If you are ready to sell your land, or would like an appraisal done to see what your land is worth, please contact me at 320-894-7528 or noah@farmlandman.com. I'd be happy to help.

Take care,

Noah Hultgren
The FarmlandMan.com

Monday, April 25, 2011

Ethanol Policy

I received a press release the other day that I thought would be worth passing on. It is copied below, including contact information if you'd like more information:

Ethanol: The Right Policy for Combating Oil Prices for Food and Energy Security
WASHINGTON (April 14, 2011) – The following statement was released today by the National Corn Growers Association, the Renewable Fuels Association, Growth Energy and the American Coalition for Ethanol in response to Thursday’s Policy Forum on Corn Ethanol Policy in the 112th Congress.
“Any energy policy forum must include comprehensive and adult conversations about America’s entire energy agenda, including subsidies and other supportive policies for mature and aging technologies like petroleum. Unfortunately, it is unlikely this ‘forum’ will include any of those discussions. Rather, this is yet another example of defenders of the status quo wasting the time of Congress focusing on bogus claims against the ethanol industry instead of finding solutions to the real problems.
“Anyone who has filled a gas tank the last few months has unwittingly witnessed the prime cause of soaring prices for all consumer goods, especially food. The last time corn and food prices rose, the Congressional Budget Office found that factors other than biofuels were responsible for as much as 90 percent of the hike. The World Bank and the government of the United Kingdom have concluded that speculation and energy prices were chief drivers of the 2007-08 spikes in commodity and food prices. How anyone can point fingers at farmers for driving up food prices when they receive less than 12 cents of every food dollar defies common sense.
“Ethanol is the only viable solution we have today to help with our country’s energy security and independence. Today, when it can easily cost over $50 to fill a gas tank, critics would be wise to remember that domestic ethanol actually has helped motorists by lowering gas prices by estimates as high as 40 cents per gallon. To put it in even better perspective, the value of the crude oil displaced by U.S. ethanol amounted to $34 billion in 2010 – money that stayed in the American economy. In the end, that’s the best way to support food and energy security, not through holding make-believe one-sided policy forums.”
The group pointed out that, according to the Institute for Local Self Reliance, 75 cents of every dollar spent on biofuels re‐circulates through the local economy while 75 cents of every dollar spent on oil exits the local economy and, in most cases, the country.

For More Information Contact:
Janice Tolley Walters, NCGA, (202) 628-7001 or walters@dc.ncga.com
Matt Hartwig, Renewal Fuels Association, (202)289-3835 or mhartwig@ethanolrfa.org
Kristin Brekke, American Coalition for Ethanol, (605) 334-3381 or kbrekke@ethanol.org
Stephanie Dreyer, Growth Energy, (202) 545-4000 or sdreyer@growthenergy.org

About the National Corn Growers Association
Founded in 1957, the National Corn Growers Association represents 35,000 dues-paying corn farmers nationwide and the interests of more than 300,000 growers who contribute through corn checkoff programs in their states. NCGA and its 48 affiliated state associations and checkoff organizations work together to create and increase opportunities for their members and their industry. For more information, visit www.ncga.com.

About Growth Energy
Growth Energy is a group committed to the promise of agriculture and growing America's economy through cleaner, greener energy. Growth Energy members recognize America needs a new ethanol approach. Through smart policy reform and a proactive grassroots campaign, Growth Energy promotes reducing greenhouse gas emissions, expanding the use of ethanol in gasoline, decreasing our dependence on foreign oil, and creating American jobs at home. More information can be found at GrowthEnergy.org.

About the American Coalition for Ethanol
The American Coalition for Ethanol (ACE) is the grassroots voice of the U.S. ethanol industry, a national advocacy association for the ethanol industry with nearly 1,500 members nationwide, including farmers, ethanol producers, commodity organizations, businesses supplying goods and services to the ethanol industry, rural electric cooperatives, and individuals supportive of increased production and use of ethanol. For more information about ethanol or ACE, visit www.ethanol.org or call (605) 334-3381.
About the Renewable Fuels Association
The RFA is the national trade association for the U.S. ethanol industry. Since 1981, the RFA serves as the voice of the ethanol industry, providing advocacy, authoritative analysis, and important industry data to its members, Congress, federal and state government agencies, strategic partners, the media and other opinion-leader audiences. For more information visit www.EthanolRFA.org.

Tuesday, April 12, 2011

Farm Incomes Up

According to analysis from the Minnesota State Colleges and Universities (MnSCU) system and the University of Minnesota, 2010 was a better year for farming than 2009. Much of the gain was due to increased profits in hog farming, but crop farmers also had a profitable year in 2010.



The positive news was based on the responses of about 2,450 farmers in the state, who report in to the "FINBIN - Farm Financial Database." The FINBIN website is located here:

http://www.finbin.umn.edu/

And is definitely worth exploring. Out of curiousity, I checked on land rent rates for corn farmers in Minnesota. In 2010, the average land rent cost was $143.62, which was about right (maybe even a little low) for our area. I looked at sugar beets, and the land rent average was $104.07 in the state - but that is obviously low for our area. Instead, I looked just at Kandiyohi County and the surroundiung counties, and the average land rent was $166.10 in 2010 - which sounds a lot more realistic for this region.

In addition to land rent costs for specific crops, the FINBIN database also includes information on other expenses ranging from seed and fertilizer to custom farming and hired labor to machinery leases and repair expenses. It's a great set of data for benchmarking your operation.

If you want help with farm management or appraising your agricultural land in the face of rising land rent prices and increasing farm profits, please give me a call at 320-894-7528. Weather permitting, I'll be in the fields for planting soon, but I am still available to help you with all of your real estate needs.

Warmest,

Noah Hultgren
The FarmlandMan
www.farmlandman.com

p.s. Congratulations again to the MACCRAY Boys Basketball team on finishing 3rd in State! As a former Wolverine basketball player on the last team that went to state (in 1996), I was proud to watch all of the games and excited to see us so well-represented!

Thursday, March 31, 2011

Another good year?

The Minneapolis Star Tribune ran an article today looking at the prospects for "Another Bumper Year for Farmers", written by Mike Hughlett.

According to Hughlett's article, "With planting just around the corner, Minnesota farmers are feeling particularly optimistic. They're coming off bumper crops in 2010, and the federal government is predicting record farm income for the agricultural marketing year that ends Aug. 31. Perhaps best of all, prices for major grains are currently near highs not seen since the big commodity price run-up of 2008."

The article notes a couple reasons for concern, however. Apparently grain reserves are low, perhaps meaning "a bad crop could propel already high corn and soybean prices to heights that would hammer the livestock industry with higher feed prices and ultimately hurt consumers through higher food prices." Bad weather would obviously negatively impact the industry as well.

As farmers are gearing up for the planting season, the article notes that "There's extra reason for getting fired up this spring: Corn and soybean prices, as measured by May-delivery futures contracts, are respectively about 65 percent and 45 percent higher than they were a year ago." 

The article includes some quotes from Greg Schwarz, who grows corn and soybeans on about 1,000 acres near Le Sueur, and is president of the Minnesota Corn Growers Association. He believes that farmers are in a good position to lock in good profits, which is a "good feeling" for farmers. 

"Farmers across the country are considerably more positive this March than they were a year ago, according to a survey by DTN/The Progressive Farmer," the article continues. "The study is based on farmers' attitudes toward their input costs, profit margins and household income."

Obviously, this is a good time to be in farming, and that is good for farmland values. If you are interested in having your farmland appraised, or you think now is the time to sell your farmland, please contact me. I can be very helpful in meeting your farmland real estate needs.

Sincerely,
Noah Hultgren
noah@farmlandman.com
320-894-7528

p.s. Congratulations to the MACCRAY boys basketball team for finishing 3rd in the state Class A tournament last weekend. We went down and watched all three games - way to go Wolverines!

Thursday, March 3, 2011

Cash Rent for 2010

I was just looking through the National Agricultural Statistics Service (NASS) Cash Rents for 2010 report, and saw a couple interesting trends. First of all, cash rents for non-irrigated cropland took some big jumps in the last year, and continue to be highest in our part of the state.

For example, cash rents rose about $10 per acre in Kandiyohi County, from $144 in 2009 to $154 in 2010; and jumped $17 per acre in Renville County, from $146 in 2009 to $163 in 2010. There were $20 per acre increases in both Chippewa and Yellow Medicine Counties; with both counties now hovering around $150 per acre cash rents.

The biggest year-over-year increase in cash rent for non-irrigated cropland happened in Dodge County, in Southeast Minnesota, which went from $177 in 2009 to $201 in 2010. The first and only county to break $200 per acre on average, Dodge County was at the top of the state for cash rents in 2010.

Cash rents in many of the most productive counties in Southern Minnesota are now hovering between $125 and $175 per acre; with more counties moving toward the $175 side of the equation. In our region and beyond, I found 26 counties where cash rents had climbed above $150 per acre. If recent trends continue, I could easily see maybe 8 to 10 more to hit that level in the next year.

If you have questions about your cash rent levels, or would like an appraisal on your farmland, please give me a call at 320-894-7528. I would love to help you get full value for your farmland!

Thanks,
Noah Hultgren
The FarmlandMan.com
noah@farmlandman.com
www.farmlandman.com

Friday, February 4, 2011

Useful Advice for Farmers who Rent Land

I recently read an interesting article in the AgWeek publication about new ways to improve the relationship between farmers who rent land and the landowners they rent from.


The author noted that winter is typically the time of year when farmers and landowners are negotiating rental agreements, and highlighted a couple ideas on how to forge a stronger partnership. Consider these solutions from Willie Huot, a North Dakota extension educator "who has studied land rent negotiations and advises farmers on how to approach them":

  • Consider creating a newsletter to update landlords on what’s happening on the farm and in agriculture. - “It’s an educational effort and a communications tool,” Huot says.
  • Resumes are another potential tool. Producers can list their agricultural accomplishments and abilities, much the way a job seeker does.

These could be great ways to keep in contact with landowners by giving them more insight into the type of farming operation being run and the plans for the future.

If you are looking for help selling your farmland or in navigating the ever-changing rental market, please give me a call at 320-894-7528.

Have a great day!
Noah Hultgren
The FarmlandMan

Monday, January 24, 2011

Sugar beet summary


I was just reading through the summary of the 2010 review from the Southern Minnesota Beet Sugar Cooperative in the January 2011 edition of "The SugarBeet Grower Magazine."


SMBSC's Todd Geselius reported that SMBSC's growers ended the 2010 crop year by delivering 3,094,801 tons from 114,893 harvested acres, resulting in an average yield of 26.94 tons per acre. "This is the second largest crop we have grown at Southern Minnesota, surpassed only by the 2009 crop," noted Geselius. "The sugar content ended the season at 16.23%." Overall, it was considered a great crop year.


I compared that to the results from some of the other sugar companies that reported in, and SMBSC seemed to be in line. For example, American Crystal Sugar Company reported 26.3 tons per acre (which was the highest average yield in their history) and just over 18% sugar content. The Michigan Sugar Company averaged 26.07 tons per acre (which was also second highest in their history) and 18.17% for grower sugar. Minn-Dak Farmers Cooperative harvested 3,108,000 tons of sugarbeets with an average of 27.15 tons per acre, with average sugar content of 16.8%.


Successful harvests are likely to continue to push land values and rents higher in the future. To learn more about your options for seeling or renting your land, please contact me at 320-894-7528 or noah@farmlandman.com. I'd love to help you make the most of this market!


Take care,
Noah Hultgren
The FarmlandMan
www.farmlandman.com

Wednesday, January 19, 2011

15 reasons why farmers shouldn't speak up

Here is a link that was forwarded to me from a colleague. It's a highly sarcastic (tongue-in-cheek) list of why farmers SHOULD NOT stand up and speak out for agriculture.

After all, non-farmers are already very knowledgeable about what farmers do, right?

http://www.causematters.com/advocacy/why-farmers-should-not-speak-up/

Michele's list has hit a nerve for some of us, but also allows us to laugh about the perceptions of our industry. I hope you enjoy the blog!

Have a great week!

Noah
The FarmlandMan.com
320-894-7528