The idea that the mainstream media and the Democrats are the same is idiotic. I swear the far right has lost the ability to think and reason.
Kinze Manufacturing is laying off 193 of their 815 employees
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I agree with everything you said, except that land isn't selling.
While the record high price being set with just about every sale has cooled...land is still trading at high prices historically. But yes, many farmers are caught in a crunch now, no doubt. Some though are still sitting there with A LOT of cash, ready to buy land, etc.
Always a very tough decision.
Gets more and more difficult when generations start passing away.
At least you will get a step up in basis so if you sell it's pretty much a tax free transaction.
I was back in Iowa the past two weeks. Helped my old farm boss a little. Saw a lot of my neighbor farmers in town. There are two completely different types of farmers and their concerns are different. The old ones with owned ground and little rented ground will be fine. Those with high cash rents, machinery leases that are ending, and large operating loans will be epically fuked.
With corn under $4 there will be folks going under if they can’t get the operating credit.
Machinery sales will suck in 2024. They already are
With corn under $4 there will be folks going under if they can’t get the operating credit.
Machinery sales will suck in 2024. They already are
My agenda was that some, like the one I quoted will bitch when farmers get help but also bitch when they aren’t spending money.
Doesn’t take an agenda to call a spade a spade.
Nor does it take an agenda to realize that farmers get some great financial breaks from American taxpayers.
I suppose next you’ll tell me other business owners get financial breaks as well.
Yeah, but I'm not looking forward to going through it when it happens. Going to be a rough time.
Yes, but you might be surprised to learn how little row crops contribute to the cost of our food. Labor, transportation, and even packaging, contribute more.
The current price slump in grains, and thus farmer income, is more a function of the supply/demand cycle. This cycle is no longer just a North American phenom, its world wide with Brazil becoming a very robust competitor. These current depressed prices will almost assuridy uncover increased demand in the next couplethree years...and thus it goes.
Farmers generally struggle. It’s a tough racket…farming, OiT. The economy is doing fine at the moment. But economies go UP and DOWN. But let’s be honest here OiT, the US economy is much more vibrant than other nation’s economies are at present.
The increase in ethanol production, which eventually drove the cost of grain up, temporarily, caused the price of corn for human food to rise and forced food suppliers to look for alternative ingredients.
It was a gradual shift away and once that demand is gone...it doesn't return.
Some of the biggest proponents, in this State for example, were the Iowa Farm Bureau and the Corngrowers Association.
Even beef producers were going to other sources of feed for their livestock.
The problem for soybeans are rooted in the trade war with China spurred by the previous President. Brazil became a more important world soybean supplier.
And some of the blame lies with farmers themselves, who have driven up land prices and cash rent because they always had govt price protection through subsidies.
It was a gradual shift away and once that demand is gone...it doesn't return.
Some of the biggest proponents, in this State for example, were the Iowa Farm Bureau and the Corngrowers Association.
Even beef producers were going to other sources of feed for their livestock.
The problem for soybeans are rooted in the trade war with China spurred by the previous President. Brazil became a more important world soybean supplier.
And some of the blame lies with farmers themselves, who have driven up land prices and cash rent because they always had govt price protection through subsidies.
This just in...employees at Kinze first heard the news of the layoffs from a KCRG news story.
That's some real bullshit regarding Kinze Mgmt.
That's some real bullshit regarding Kinze Mgmt.
Farm economy is often independent of the overall national economy. I’m surprised you didn’t know that
Interesting perspective.. not just the farmers with large credit lines, but JD and all row crop related machinery manufacturers have designed equipment for (taking a wild guess here) at least $5+ corn .. so they will have to retool somehow.. bankers sweating they don’t want to call in loans.
The market will have to figure it out or weird things will start to happen.
Can you share what $5 corn and equipment design have to do with each other?
Could be a case of three shifts and not easy to tell everybody simultaneously.
Of course I could be wrong but have heard about the difficulties of telling three shifts corporate news before the press finds out.
I could be wrong, but I believe they only have two work shifts in Williamsburg.
The actual layoffs might not be a surprise because employees know the activity, or lack thereof, in the recent past. They know what "busy" looks like.
But the scale of the layoff(nearly 25% of workforce) is probably a big shock.
And if true, the story is they found out on Wednesday and were gone by Thursday.
That's extremely short notice.
I'd bet law enforcement was present .
Iowa needs diversification in its economy, bigly. We have not expanded our manufacturing base enough, nor has Iowa invested in new industries. We have to decide if it’s woke or not, first.
Corn is currently $4, not $5. I’m not sure what you mean by design but farmers aren’t going to be making high dollar capital purchases if they don’t have to.
Why I said wild guess, looking for others to bring in a more expert opinion.
A lot easier for JD to sell a half a million tractor when corn is $7, than $4… yet there is a tipping point between those figures where we see these layoffs at equipment manufacturers, such as JD and Kinze.
I am looking at the price of corn as the leading indicator… not the farmers personal decision to buy or not buy-which is a lag result of the leading indicator.
It seems the business plan for these manufactures was based on their projections of much higher grain prices than where they are currently at.
How do they adjust as a business to remain in business under these low grain prices? Where is the inflection point?
Morning in America in 1984, not in farm country. Similarly the strong national economy but bad farm economy in 88 when Dukakis took Iowa.
Land sells and damn high. Just isn’t much for sale. 230 acres sold in Grundy county for over $17,000 an acre not that long ago.
It’s really all about shareholder value. A big drop off in projected earnings after a record year has to be mitigated. Also, we all know JD is going to attempt to lower production/labor costs by moving it south of the border, yet prices for their equipment will continue to climb until the equipment market is disrupted somehow.
Life is not always fair…farmers are not excluded. The move is more and more to “corporate farms” and only the big ones will survive. Smart (and lucky) operators will survive. Those short on cash and victimized with bad luck, won’t. Pretty simple. Nothing sinister but honest. Capitalism survives because it destroys folks financially.
For capitalism to win, someone has to lose. Winners are constantly working to tip the field in their favor. Capitalism cannot grow if all things are equal. There must always be “an edge” or something to leverage.
So who was the loser when Microsoft introduced the windows operating system? Maybe a few folks who were trying to make a competing operating system, although I’m sure those losers could have easily been hired by Microsoft or another tech company after their company went bankrupt.
But the positive impact, Microsoft and windows, created was far and vast; as such the shareholders were rewarded handsomely.
If there was no reward, would there have been a Microsoft to begin with?
Would the government, (in a more China like way) have done better in creating the value for everyone the same way Microsoft did?
Government?? I was talking “capitalism”….Capitalism demands losers for it to succeed. For every winner in capitalism, there are one or more losers in its wake. These small farm machinery manufacturers and smaller under capitalized farmers are in the way of the scythe of capitalism.
I’m not going there….all I am saying is that capitalism destroys folks financially in order to survive. Just. A. Simple. Observation.
I’m sure those people it destroys aren’t actually destroyed. Plenty of ways for someone to pick up new work and maybe even learn from their failures to get better.
Someone does “win”…… but understand, someone does “lose” too. And the bankers are the enablers…
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My dad sold for IH up until 2 years ago. The manufacturers were increasing the price on new equipment by 50k a year compared to the normal inflation adjusted price increases. The reason….they could. When corn is above $5, all input suppliers will raise prices to get their share.
