SlideShare a Scribd company logo
1 of 20
Download to read offline
Current Ag Financial
Climate: Economic
Indicators to Watch
2015 Women Managing the Farm
Amy Gales, EVP Regional Agribusiness
CoBank
February 5, 2015
 Indicators
 Commodity Prices
 Interest Rates
 Land values & Cash Rent
 Domestic Economy
 World Economy
 Talent
 Technology
 Risk Management
 Financial Management
Indicators to Watch—As you Manage your Farm
Confidential and
Proprietary 2
Norwegian Icebreaker
Confidential and
Proprietary 3
As you may have seen on the news it's been very cold in the Midwest …..So cold, in
fact, that the City Government has borrowed a Norwegian Icebreaker to clear
the Mississipppi River for fishing and migrating waterfowl.
December 2013 December 2014
Economy
U.S. real GDP
growth
 1.9% 9 months 2013 actual (annualized)
 2.5% - 2.9% 2014 forecast
 2.7% 9 months 2014 actual (annualized)
 3.0% - 3.1% 2015 forecast (IMF & World Bank)
10-yr U.S.
Treasury
 3.03%
 A new high for 2013
 2.17%
Future interest
rates
 4.69% January 2019 5-year swap rate forecast  2.79% January 2020 5-year swap rate forecast
Home prices  10% increase projected for 2014  3% - 4% increase projected for 2015
Unemployment  7.00% (November)  5.80% (November)
Inflation  1.31% Core PCE (November)  1.41% Core PCE (November)
Commodity
Prices*
Corn  $4.28/bu  $3.97/bu
Soybeans  $13.32/bu  $10.19/bu
Wheat  $6.09/bu  $5.90/bu
Oil (WTI)  $98.42/bbl  $53.27/bbl
Volatility and Uncertainty Continue
4
* Nearby future prices
5
* Nearby future prices
6
* Nearby future prices
7
* Nearby future prices
8
* Nearby future prices
9
* Nearby future prices
Interest Rate Yield Curve
Confidential and
Proprietary 10
10 Year Interest Rates
Confidential and
Proprietary 11
Interest rate movements have two important
impacts on farmland values
Expected
Farm Income
Capitalization
Rates
Farmland
Values
=÷Interest
Rates
Sale Price Cash Rent
2006 $1200 $74
2007 $1260 $82
2008 $1450 $92
2009 $1500 $89
2010 $1600 $95
2011 $1900 $105
2012 $2400 $119
2013 $3000 $137
2014 $3280 $126
Kansas Price Per Acre-Irrigated Cropland
Kansas Agricultural Statistical Districts
13
Value of the Dollar
Confidential and
Proprietary 16
“If I were running a company today, I would have one priority above all
others: to acquire as many of the best people as I could …[because] the
single biggest constraint on the success of my organization is the ability to
get and to hang on to enough of the right people.” — Jim Collins
Talent and Engagement
Confidential and
Proprietary 17
 “If automobiles had followed the same development cycle as the
computer, a Rolls-Royce would today cost $100, get a million miles per
gallon, and explode once a year, killing everyone inside” ~ Robert
Cringely
Technology
Confidential and
Proprietary 18
Information Technology in Agriculture
Confidential and
Proprietary 19
Questions?

More Related Content

What's hot

March 2014 Corporate Presentation
March 2014 Corporate PresentationMarch 2014 Corporate Presentation
March 2014 Corporate Presentation
Crocodile Gold
 
DouglasKatz_Buying_Versus_Renting
DouglasKatz_Buying_Versus_RentingDouglasKatz_Buying_Versus_Renting
DouglasKatz_Buying_Versus_Renting
Doug Katz
 
The Clg Flyer11 01 09 C Scott
The Clg Flyer11 01 09 C ScottThe Clg Flyer11 01 09 C Scott
The Clg Flyer11 01 09 C Scott
michaelchadscott
 

What's hot (18)

CCIM Thrive 2015 Economic Outlook
CCIM Thrive 2015 Economic OutlookCCIM Thrive 2015 Economic Outlook
CCIM Thrive 2015 Economic Outlook
 
Macro 22
Macro 22Macro 22
Macro 22
 
VectorVest April 15
VectorVest April 15VectorVest April 15
VectorVest April 15
 
12 18-12 landlord tenant workshop
12 18-12 landlord tenant workshop12 18-12 landlord tenant workshop
12 18-12 landlord tenant workshop
 
Agribusiness Update for 2014
Agribusiness Update for 2014Agribusiness Update for 2014
Agribusiness Update for 2014
 
Crude Oil and it’s price history
Crude Oil and it’s price historyCrude Oil and it’s price history
Crude Oil and it’s price history
 
March 2014 Corporate Presentation
March 2014 Corporate PresentationMarch 2014 Corporate Presentation
March 2014 Corporate Presentation
 
Market Predictions For 2016
Market Predictions For 2016 Market Predictions For 2016
Market Predictions For 2016
 
Business Opportunities in 2016/ Investasi Tepat, Profit Hebat
Business Opportunities in 2016/ Investasi Tepat, Profit HebatBusiness Opportunities in 2016/ Investasi Tepat, Profit Hebat
Business Opportunities in 2016/ Investasi Tepat, Profit Hebat
 
AG Environment Outside the Pork Industry
AG Environment Outside the Pork IndustryAG Environment Outside the Pork Industry
AG Environment Outside the Pork Industry
 
Facebook report
Facebook reportFacebook report
Facebook report
 
Who Owns, Rents and Buys Farmland Today
Who Owns, Rents and Buys Farmland TodayWho Owns, Rents and Buys Farmland Today
Who Owns, Rents and Buys Farmland Today
 
Long Tandou
Long TandouLong Tandou
Long Tandou
 
Dc to cambridge2
Dc  to cambridge2Dc  to cambridge2
Dc to cambridge2
 
Dc to cambridge
Dc  to cambridgeDc  to cambridge
Dc to cambridge
 
DouglasKatz_Buying_Versus_Renting
DouglasKatz_Buying_Versus_RentingDouglasKatz_Buying_Versus_Renting
DouglasKatz_Buying_Versus_Renting
 
The Clg Flyer11 01 09 C Scott
The Clg Flyer11 01 09 C ScottThe Clg Flyer11 01 09 C Scott
The Clg Flyer11 01 09 C Scott
 
Macro 6
Macro 6Macro 6
Macro 6
 

Similar to Current Agriculture Financial Climate: Economic Indicators to Watch

AFFORDABILITY2015
AFFORDABILITY2015AFFORDABILITY2015
AFFORDABILITY2015
Mike Netzel
 
Real Estate Analysis & Benchmark 121214
Real Estate Analysis & Benchmark 121214Real Estate Analysis & Benchmark 121214
Real Estate Analysis & Benchmark 121214
Dean Koeller
 
ClearPath Investment Perspectives - Nov 17 2014
ClearPath Investment Perspectives - Nov  17 2014ClearPath Investment Perspectives - Nov  17 2014
ClearPath Investment Perspectives - Nov 17 2014
bcdconna
 
2013 forecast slide presentation
2013 forecast slide presentation2013 forecast slide presentation
2013 forecast slide presentation
LCCCIllinois
 

Similar to Current Agriculture Financial Climate: Economic Indicators to Watch (20)

Comerica Economic Outlook: The Oil Price Rollercoaster and the U.S. Economy
Comerica Economic Outlook: The Oil Price Rollercoaster and the U.S. EconomyComerica Economic Outlook: The Oil Price Rollercoaster and the U.S. Economy
Comerica Economic Outlook: The Oil Price Rollercoaster and the U.S. Economy
 
Wells Fargo - SDBJ 2016 Economic Trends
Wells Fargo - SDBJ 2016 Economic TrendsWells Fargo - SDBJ 2016 Economic Trends
Wells Fargo - SDBJ 2016 Economic Trends
 
Walker Mallott Transition Team Presentation (11.21.2014final)
Walker Mallott Transition Team Presentation (11.21.2014final)Walker Mallott Transition Team Presentation (11.21.2014final)
Walker Mallott Transition Team Presentation (11.21.2014final)
 
Economic Briefing Breakfast
Economic Briefing BreakfastEconomic Briefing Breakfast
Economic Briefing Breakfast
 
cushman & wakefield the economy cre and investment ideas -
 cushman & wakefield   the economy cre and investment ideas - cushman & wakefield   the economy cre and investment ideas -
cushman & wakefield the economy cre and investment ideas -
 
Economic Forecast - Summer 2014 NCLGBA Conference
Economic Forecast - Summer 2014 NCLGBA ConferenceEconomic Forecast - Summer 2014 NCLGBA Conference
Economic Forecast - Summer 2014 NCLGBA Conference
 
Mercer Capital's Value Focus: Agribusiness | Q3 2014 | Segment: Agriculture R...
Mercer Capital's Value Focus: Agribusiness | Q3 2014 | Segment: Agriculture R...Mercer Capital's Value Focus: Agribusiness | Q3 2014 | Segment: Agriculture R...
Mercer Capital's Value Focus: Agribusiness | Q3 2014 | Segment: Agriculture R...
 
AFFORDABILITY2015
AFFORDABILITY2015AFFORDABILITY2015
AFFORDABILITY2015
 
Presentation to Alaska Policy Frontiers (11.22.2014final)
Presentation to Alaska Policy Frontiers (11.22.2014final)Presentation to Alaska Policy Frontiers (11.22.2014final)
Presentation to Alaska Policy Frontiers (11.22.2014final)
 
Real Estate Analysis & Benchmark 121214
Real Estate Analysis & Benchmark 121214Real Estate Analysis & Benchmark 121214
Real Estate Analysis & Benchmark 121214
 
ClearPath Investment Perspectives - Nov 17 2014
ClearPath Investment Perspectives - Nov  17 2014ClearPath Investment Perspectives - Nov  17 2014
ClearPath Investment Perspectives - Nov 17 2014
 
2014 Economic Outlook (Michael Brown, Wells Fargo)
2014 Economic Outlook (Michael Brown, Wells Fargo)2014 Economic Outlook (Michael Brown, Wells Fargo)
2014 Economic Outlook (Michael Brown, Wells Fargo)
 
Making Good Marketing Decisions - And How to Do It - Rex Zenger
Making Good Marketing Decisions - And How to Do It - Rex ZengerMaking Good Marketing Decisions - And How to Do It - Rex Zenger
Making Good Marketing Decisions - And How to Do It - Rex Zenger
 
Dr. Steve Meyer - Market & Grain Outlook
Dr. Steve Meyer - Market & Grain OutlookDr. Steve Meyer - Market & Grain Outlook
Dr. Steve Meyer - Market & Grain Outlook
 
2014 Economic Outlook Briefing
2014 Economic Outlook Briefing2014 Economic Outlook Briefing
2014 Economic Outlook Briefing
 
2013 forecast slide presentation
2013 forecast slide presentation2013 forecast slide presentation
2013 forecast slide presentation
 
September 2018 Realtor Report
September 2018 Realtor ReportSeptember 2018 Realtor Report
September 2018 Realtor Report
 
Dealing with $75 oil (copas 11.17.2014 final)
Dealing with $75 oil (copas 11.17.2014 final)Dealing with $75 oil (copas 11.17.2014 final)
Dealing with $75 oil (copas 11.17.2014 final)
 
Dr. Michael Swanson's Slides from the 2014 Minnesota AgriGrowth Council Annua...
Dr. Michael Swanson's Slides from the 2014 Minnesota AgriGrowth Council Annua...Dr. Michael Swanson's Slides from the 2014 Minnesota AgriGrowth Council Annua...
Dr. Michael Swanson's Slides from the 2014 Minnesota AgriGrowth Council Annua...
 
Latest Dallas Fed Energy Slideshow
Latest Dallas Fed Energy SlideshowLatest Dallas Fed Energy Slideshow
Latest Dallas Fed Energy Slideshow
 

More from dhagenmaier

More from dhagenmaier (14)

Women in Agriculture: Your Body, Your Tools
Women in Agriculture: Your Body, Your ToolsWomen in Agriculture: Your Body, Your Tools
Women in Agriculture: Your Body, Your Tools
 
Possibilities and Planning Strategically Using Social Media on Your Farm or R...
Possibilities and Planning Strategically Using Social Media on Your Farm or R...Possibilities and Planning Strategically Using Social Media on Your Farm or R...
Possibilities and Planning Strategically Using Social Media on Your Farm or R...
 
Social Security 101
Social Security 101Social Security 101
Social Security 101
 
Cooperatives: Who are they? What are they? Why are they important to my farmi...
Cooperatives: Who are they? What are they? Why are they important to my farmi...Cooperatives: Who are they? What are they? Why are they important to my farmi...
Cooperatives: Who are they? What are they? Why are they important to my farmi...
 
What is
What isWhat is
What is
 
New Farm Bill Conservation Programs
New Farm Bill Conservation ProgramsNew Farm Bill Conservation Programs
New Farm Bill Conservation Programs
 
Barfield
BarfieldBarfield
Barfield
 
Larson trusts-advanced
Larson   trusts-advancedLarson   trusts-advanced
Larson trusts-advanced
 
2014 Farm Bill Programs
2014 Farm Bill Programs2014 Farm Bill Programs
2014 Farm Bill Programs
 
Feast of the Fields
Feast of the FieldsFeast of the Fields
Feast of the Fields
 
Grain Marketing 101
Grain Marketing 101Grain Marketing 101
Grain Marketing 101
 
Trusts (beginner level)
Trusts (beginner level)Trusts (beginner level)
Trusts (beginner level)
 
USDA-Farm Service Agency Farm Loan Programs
USDA-Farm Service Agency Farm Loan ProgramsUSDA-Farm Service Agency Farm Loan Programs
USDA-Farm Service Agency Farm Loan Programs
 
Celebrating Women: Healthy Heroes in Agriculture
Celebrating Women: Healthy Heroes in AgricultureCelebrating Women: Healthy Heroes in Agriculture
Celebrating Women: Healthy Heroes in Agriculture
 

Recently uploaded

The Abortion pills for sale in Qatar@Doha [+27737758557] []Deira Dubai Kuwait
The Abortion pills for sale in Qatar@Doha [+27737758557] []Deira Dubai KuwaitThe Abortion pills for sale in Qatar@Doha [+27737758557] []Deira Dubai Kuwait
The Abortion pills for sale in Qatar@Doha [+27737758557] []Deira Dubai Kuwait
daisycvs
 

Recently uploaded (20)

Escorts in Nungambakkam Phone 8250092165 Enjoy 24/7 Escort Service Enjoy Your...
Escorts in Nungambakkam Phone 8250092165 Enjoy 24/7 Escort Service Enjoy Your...Escorts in Nungambakkam Phone 8250092165 Enjoy 24/7 Escort Service Enjoy Your...
Escorts in Nungambakkam Phone 8250092165 Enjoy 24/7 Escort Service Enjoy Your...
 
Chandrapur Call Girl Just Call 8084732287 Top Class Call Girl Service Available
Chandrapur Call Girl Just Call 8084732287 Top Class Call Girl Service AvailableChandrapur Call Girl Just Call 8084732287 Top Class Call Girl Service Available
Chandrapur Call Girl Just Call 8084732287 Top Class Call Girl Service Available
 
Putting the SPARK into Virtual Training.pptx
Putting the SPARK into Virtual Training.pptxPutting the SPARK into Virtual Training.pptx
Putting the SPARK into Virtual Training.pptx
 
Berhampur 70918*19311 CALL GIRLS IN ESCORT SERVICE WE ARE PROVIDING
Berhampur 70918*19311 CALL GIRLS IN ESCORT SERVICE WE ARE PROVIDINGBerhampur 70918*19311 CALL GIRLS IN ESCORT SERVICE WE ARE PROVIDING
Berhampur 70918*19311 CALL GIRLS IN ESCORT SERVICE WE ARE PROVIDING
 
KOLKATA 💋 Call Girl 9827461493 Call Girls in Escort service book now
KOLKATA 💋 Call Girl 9827461493 Call Girls in  Escort service book nowKOLKATA 💋 Call Girl 9827461493 Call Girls in  Escort service book now
KOLKATA 💋 Call Girl 9827461493 Call Girls in Escort service book now
 
Getting Real with AI - Columbus DAW - May 2024 - Nick Woo from AlignAI
Getting Real with AI - Columbus DAW - May 2024 - Nick Woo from AlignAIGetting Real with AI - Columbus DAW - May 2024 - Nick Woo from AlignAI
Getting Real with AI - Columbus DAW - May 2024 - Nick Woo from AlignAI
 
The Abortion pills for sale in Qatar@Doha [+27737758557] []Deira Dubai Kuwait
The Abortion pills for sale in Qatar@Doha [+27737758557] []Deira Dubai KuwaitThe Abortion pills for sale in Qatar@Doha [+27737758557] []Deira Dubai Kuwait
The Abortion pills for sale in Qatar@Doha [+27737758557] []Deira Dubai Kuwait
 
Lundin Gold - Q1 2024 Conference Call Presentation (Revised)
Lundin Gold - Q1 2024 Conference Call Presentation (Revised)Lundin Gold - Q1 2024 Conference Call Presentation (Revised)
Lundin Gold - Q1 2024 Conference Call Presentation (Revised)
 
PHX May 2024 Corporate Presentation Final
PHX May 2024 Corporate Presentation FinalPHX May 2024 Corporate Presentation Final
PHX May 2024 Corporate Presentation Final
 
SRI GANGANAGAR 💋 Call Girl 9827461493 Call Girls in Escort service book now
SRI GANGANAGAR 💋 Call Girl 9827461493 Call Girls in  Escort service book nowSRI GANGANAGAR 💋 Call Girl 9827461493 Call Girls in  Escort service book now
SRI GANGANAGAR 💋 Call Girl 9827461493 Call Girls in Escort service book now
 
WheelTug Short Pitch Deck 2024 | Byond Insights
WheelTug Short Pitch Deck 2024 | Byond InsightsWheelTug Short Pitch Deck 2024 | Byond Insights
WheelTug Short Pitch Deck 2024 | Byond Insights
 
Unveiling Falcon Invoice Discounting: Leading the Way as India's Premier Bill...
Unveiling Falcon Invoice Discounting: Leading the Way as India's Premier Bill...Unveiling Falcon Invoice Discounting: Leading the Way as India's Premier Bill...
Unveiling Falcon Invoice Discounting: Leading the Way as India's Premier Bill...
 
Solan Call Girl Just Call 8084732287 Top Class Call Girl Service Available
Solan Call Girl Just Call 8084732287 Top Class Call Girl Service AvailableSolan Call Girl Just Call 8084732287 Top Class Call Girl Service Available
Solan Call Girl Just Call 8084732287 Top Class Call Girl Service Available
 
Nashik Call Girl Just Call 7091819311 Top Class Call Girl Service Available
Nashik Call Girl Just Call 7091819311 Top Class Call Girl Service AvailableNashik Call Girl Just Call 7091819311 Top Class Call Girl Service Available
Nashik Call Girl Just Call 7091819311 Top Class Call Girl Service Available
 
Kalyan Call Girl 98350*37198 Call Girls in Escort service book now
Kalyan Call Girl 98350*37198 Call Girls in Escort service book nowKalyan Call Girl 98350*37198 Call Girls in Escort service book now
Kalyan Call Girl 98350*37198 Call Girls in Escort service book now
 
Lucknow Housewife Escorts by Sexy Bhabhi Service 8250092165
Lucknow Housewife Escorts  by Sexy Bhabhi Service 8250092165Lucknow Housewife Escorts  by Sexy Bhabhi Service 8250092165
Lucknow Housewife Escorts by Sexy Bhabhi Service 8250092165
 
Chennai Call Gril 80022//12248 Only For Sex And High Profile Best Gril Sex Av...
Chennai Call Gril 80022//12248 Only For Sex And High Profile Best Gril Sex Av...Chennai Call Gril 80022//12248 Only For Sex And High Profile Best Gril Sex Av...
Chennai Call Gril 80022//12248 Only For Sex And High Profile Best Gril Sex Av...
 
Marel Q1 2024 Investor Presentation from May 8, 2024
Marel Q1 2024 Investor Presentation from May 8, 2024Marel Q1 2024 Investor Presentation from May 8, 2024
Marel Q1 2024 Investor Presentation from May 8, 2024
 
Call 7737669865 Vadodara Call Girls Service at your Door Step Available All Time
Call 7737669865 Vadodara Call Girls Service at your Door Step Available All TimeCall 7737669865 Vadodara Call Girls Service at your Door Step Available All Time
Call 7737669865 Vadodara Call Girls Service at your Door Step Available All Time
 
Horngren’s Cost Accounting A Managerial Emphasis, Canadian 9th edition soluti...
Horngren’s Cost Accounting A Managerial Emphasis, Canadian 9th edition soluti...Horngren’s Cost Accounting A Managerial Emphasis, Canadian 9th edition soluti...
Horngren’s Cost Accounting A Managerial Emphasis, Canadian 9th edition soluti...
 

Current Agriculture Financial Climate: Economic Indicators to Watch

  • 1. Current Ag Financial Climate: Economic Indicators to Watch 2015 Women Managing the Farm Amy Gales, EVP Regional Agribusiness CoBank February 5, 2015
  • 2.  Indicators  Commodity Prices  Interest Rates  Land values & Cash Rent  Domestic Economy  World Economy  Talent  Technology  Risk Management  Financial Management Indicators to Watch—As you Manage your Farm Confidential and Proprietary 2
  • 3. Norwegian Icebreaker Confidential and Proprietary 3 As you may have seen on the news it's been very cold in the Midwest …..So cold, in fact, that the City Government has borrowed a Norwegian Icebreaker to clear the Mississipppi River for fishing and migrating waterfowl.
  • 4. December 2013 December 2014 Economy U.S. real GDP growth  1.9% 9 months 2013 actual (annualized)  2.5% - 2.9% 2014 forecast  2.7% 9 months 2014 actual (annualized)  3.0% - 3.1% 2015 forecast (IMF & World Bank) 10-yr U.S. Treasury  3.03%  A new high for 2013  2.17% Future interest rates  4.69% January 2019 5-year swap rate forecast  2.79% January 2020 5-year swap rate forecast Home prices  10% increase projected for 2014  3% - 4% increase projected for 2015 Unemployment  7.00% (November)  5.80% (November) Inflation  1.31% Core PCE (November)  1.41% Core PCE (November) Commodity Prices* Corn  $4.28/bu  $3.97/bu Soybeans  $13.32/bu  $10.19/bu Wheat  $6.09/bu  $5.90/bu Oil (WTI)  $98.42/bbl  $53.27/bbl Volatility and Uncertainty Continue 4 * Nearby future prices
  • 10. Interest Rate Yield Curve Confidential and Proprietary 10
  • 11. 10 Year Interest Rates Confidential and Proprietary 11
  • 12. Interest rate movements have two important impacts on farmland values Expected Farm Income Capitalization Rates Farmland Values =÷Interest Rates
  • 13. Sale Price Cash Rent 2006 $1200 $74 2007 $1260 $82 2008 $1450 $92 2009 $1500 $89 2010 $1600 $95 2011 $1900 $105 2012 $2400 $119 2013 $3000 $137 2014 $3280 $126 Kansas Price Per Acre-Irrigated Cropland Kansas Agricultural Statistical Districts 13
  • 14.
  • 15.
  • 16. Value of the Dollar Confidential and Proprietary 16
  • 17. “If I were running a company today, I would have one priority above all others: to acquire as many of the best people as I could …[because] the single biggest constraint on the success of my organization is the ability to get and to hang on to enough of the right people.” — Jim Collins Talent and Engagement Confidential and Proprietary 17
  • 18.  “If automobiles had followed the same development cycle as the computer, a Rolls-Royce would today cost $100, get a million miles per gallon, and explode once a year, killing everyone inside” ~ Robert Cringely Technology Confidential and Proprietary 18
  • 19. Information Technology in Agriculture Confidential and Proprietary 19