Over 80% of farm assets pertains to land, an agricultural input, an investment and even a collateral in loans. The Federal Reserve Bank of Chicago reports that agricultural land values for the Seventh Federal Reserve District showed signs of stabilizing in the first quarter of 2018, as farmland values were unchanged from a year ago.
The likelihood of a full-blown trade war between the U.S. and China has increased substantially in the past few months, with each country either implementing or proposing a range of tariffs against each other’s imports.
The Agricultural Adjustment Act of 2014 (more commonly know as the 2014 farm bill) reformed the safety net for U.S. row crop producers. Among several changes, direct decoupled payments were replaced with two countercyclical programs that targeted shallow loses in revenue and price.
Agriculture is an uncertain industry, where the only certainty is a guarantee that there will indeed be uncertainty and risk. Already in 2018, frequent rains have delayed spring planting and increased the risk of disease and pest pressure.