Forget Willie Nelson and the farm aid concerts of fifteen years ago. Farmers have never had it so good. The combination of a world hungry for more grains both for themselves and their livestock has seen the world turn upside down.
Since 2007, prices for farmland in the Midwest has risen over 100%. This summer’s drought has driven prices for Soybeans, Wheat and Corn to record highs.
On Wednesday, the Kansas City Fed released a report that in the past quarter that land prices for non-irrigated farmland rose an additional 26% for the past quarter. Most of the sales reported were in areas where Wheat is considered the main crop.
You might think that with the drought, farmers were going to be on hard times this year, but the use of futures to hedge much of their risk should allow them to report near record incomes, if not record earnings.
Where the land prices are headed from here is anybody’s guess. This kind of “speculative fever” in farmland has hit the US before, and actually started one of the great depressions in US history. The “Cotton panic of 1837”.
One thing is for sure there will be plenty of opportunity in the agriculture sector of the market for quite some time to come.
High prices and volatility always combine for opportunity and there will be plenty of time to take advantage of this opportunity.
I teach my students how to take advantage of any market condition, and I can teach you too. The “bubble” in farmland prices will lead to some opportunity, and my method of trading is simple and takes less than thirty minutes a day to make sure that you are ready for the market to move.
I have taught scores of students how to convert opportunity into profitable trades, and I can teach you too.
To contact one of my senior course coordinators, and learn how to work with me one on one, go here:
Keep those stops tight.
Todd “Bubba” Horwitz
P.S. We run the fastest growing online options community. With weekly webinars and a very energetic forum, my team and I are always looking for great risk/reward opportunities. Click on the link below and become a member of my community today.
— Todd Horwitz