Saturday, October 11, 2008

Bad Times for Agriculture Ahead?

Just getting back into blogging and have many posts on other blogs to catch up on. But I'm anticipating problems for agriculture: the dollar is stronger against the euro and pound, so I'm assuming it's stronger against the currency of grain importing countries. And stories such as this, about grain piling up in ports because the credit markets are frozen, are worrisome. And a general slowdown in economic growth means a cutback in meat consumption. So I'm expecting sharply lower grain prices, meaning bankruptcies as farmers who committed to land purchases at high prices or rentals at high rates, can't make ends meet. In other words, a rerun of the 80's, but from a base of fewer farmers.

I'll be interested to see what John Phipps thinks.

[Updated: This Brownfield post reports an economist's guess as to the impact of a world-wide recession on farm prices.]

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