Upsides in a Volatile Agriculture Economy
“As higher fertilizer prices, chemical prices, see prices, anything that it takes to put that input that needs to be purchased to grow that crop, farmers are going to have concerns because prices are higher. And that also includes cash from cash rents as well. So all those different things, all those different production costs have increased for producers.”
Volatility also continues to be a concern for producers, however, he says are still opportunities, even with volatility.
“Farmers are really concerned about the downside volatility that could come within the situation into 2023. You know, when we look at volatility, we've got to think and remember that volatility is a two way street. You know, one a lot of times, you know, what gets impacted by margins quite a bit and talked about a lot is the downside, you know, risk that volatility brains, but we also have to remember that it's a two way street, and that there's upside opportunity within volatility that producers have the opportunity opportunity to take advantage of. And so when I talk with customers, and basically talk with farmers across the country in general, you know, I always often remind them, the better that we plan, the better that we focus on our cost and revenue structure, then we can take advantage of those upside opportunities within the volatile environment that 2023 could bring.”
Matt Erickson, agricultural economist, and policy adviser with Farm Credit Services of America.