2020 is the Halderman Company’s 90th year! This means we’ve seen a lot over the past 9 decades of serving landowners throughout the Midwest. The past decade was one of the most memorable, most volatile and filled with as much as change as those preceding.
In the past decade:
Did you know the high in the corn market was $8.39/bu. in 2012? Did you know the low was $3.06/bu. way back in 2009!
Do we want to stay in the 2010-2019 range?
Did you know soybeans topped out at $17.68/bu. in 2012 and experienced their low in 2009 as well at $7.91/bu.? Those are some very wide ranges and demonstrate the volatility we saw.
Did you know the farmland market peaked in late 2013-2014 with all-time highs well above $10,000/acre with some in the mid-teens!! While those numbers seemed unimaginable back in 2005 they did occur and in spite of declining farm incomes since 2014 farmland remains in the 80th percentile of the all-time value range.
Technology changes dominated the decade. Smart phones are now the norm for most people. This enables on-line shopping and for us at Halderman, on-line bidding at auctions. We now offer on-line bidding at almost all auctions and conduct multiple on-line only sales each year. 10 years ago we managed all the bids on dry erase boards. Now we only use digital means for posting bids and projecting them on large screens. In addition, our marketing dramatically changed with the development of drone aviation and photography as well as the use of social media platforms for advertising what we offer for sale.
Tractors have the ability to drive themselves. Crop genetics advanced significantly and when combined with fewer applications and more precise placement, they allow farmers to produce more with less (less labor, less tillage, less inputs and less water). Yields continue to increase and throughout the decade surprised many when facing tough weather situations such as the 2012 drought and 2019 planting delays. Climate change will continue and likely increase the volatility of the weather. Technology is helping combat those changes and increase production in spite of the challenges.
The decade began with most producers focused on corn and soybean production due to higher prices and ended with many farmers looking at alternatives. The most recent alternative is hemp which is now approved for production in a number of states. Organic demand is increasing and over 10% of the nation’s largest producers are growing some organic commodities. Ethanol began the decade as a growth industry and ended static in terms of production and corn use. Predictions that ethanol from something other than corn were rampant in 2010 and now seem to be fairly minimal.
From the Great Recession of 2009 to the continuance of a long economic growth period this decade saw many changes and a ton of volatility in agriculture through 2019. There was a lot of excitement and much stability over the final 5 years of the decade. Farmland demonstrated throughout that it remains a solid, foundational investment that produces a good cash yield around 3% and offers long term appreciation. In the face of volatility farmland remains a steadfast producing asset.