Tighter margins on the horizon for 2014 and beyond

Farmers are buckling in for a period of lower profits after a string of record income years, a leading Midwest banker said last week at the Iowa Farm Bureau Economic Summit in Ames.

"I don’t think there’s any question 2014 is a year of transition for agriculture," said Jim Knuth, Farm Credit Services of America senior vice president. "We don’t know what’s going to happen in the future, but we don’t expect the next decade to look like the last one. We believe 2014 is the beginning of a soft landing for agriculture."

Farmers realized record profits from 2007 to 2012 as a series of factors coincided to increase demand for crops at the same time production lagged, Knuth pointed out. That period was marked by a boom in corn-based...

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