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Year End Thoughts On The Us Farmland Market By Benedict T. Palen, Jr.

Benedict T Palen Jr - These are precarious times for the US farmland market. I have previously written about the headwinds that it was facing from large crop inventories, trade and tariff issues, and rising interest rates.<br>

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Year End Thoughts On The Us Farmland Market By Benedict T. Palen, Jr.

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  1. Year End Thoughts On The Us Farmland Market By Benedict T. Palen, Jr. These are precarious times for the US farmland market.  I have previously written about the headwinds that it was facing from large crop inventories, trade and tariff issues, and rising interest rates.  None of the uncertainty has diminished.  In fact, the longer these issues linger, the greater the concern about this market.

  2. Year End Thoughts On The Us Farmland Market By Benedict T. Palen, Jr. A factor that looms large, and which was not on the radar screen, say, 15 years ago, is the large amount of land owned by investment groups, along with the amounts of “dry powder” that some of these funds have.  It’s important to keep in mind that the newness of many of these funds means that they have not gone through a significant adjustment (downward) in land values, nor have they had too much experience with historical annual cash returns from owning farmland.   Will the funds be buyers, or will they be sellers?  That is a question that is impossible to answer right now.   And the answer will likely vary by region of the country, with possibly more pressure on these funds in the broad acre crops areas, and less so in the permanent crop areas.

  3. Year End Thoughts On The Us Farmland Market By Benedict T. Palen, Jr. The issue of the direction of some of these funds also has the backdrop of rising yields on interest bearing financial instruments, and a falling stock market. 

  4. Year End Thoughts On The Us Farmland Market By Benedict T. Palen, Jr. It would appear that, for the savvy buyer who understands the cycles of the farmland market, and who has “patient capital,” there will be opportunities during this market reset.   This requires very careful analysis of a farm, the area in which it is located, and, of course, good knowledge of the macro factors that I have noted.

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