Double U Trouble

The “it’s the economy, stupid” discussion continues this week, largely because of the testimony of Federal Reserve Chairman Ben Bernanke. Speaking before Congress last week, Bernanke uttered the following phrase when answering a question about the health of the U.S. economy.

“Even as the Federal Reserve continues prudent planning for the ultimate withdrawal of monetary policy accommodation, we also recognize that the economic outlook remains unusually uncertain,” he said in a prepared statement. Naturally, these last two “u” words sent the stock market into a freefall and confirmed fears that the danger of a double-dip recession is more real than ever.

Back in the agricultural world, the mood isn’t nearly as glum. As I wrote in my column a few weeks back, agriculture seems to be weathering the economic storm pretty well. From what folks I’ve talked with have said, money is being spent by grower-customers, crop inputs are moving out into the field, and custom application work is brisk. Despite some drought and flooding in the Midwest, the nation’s corn and soybean crops seems like they are on pace for a strong harvest year. This was particularly true during my recent visit to Maryland and Eastern Pennsylvania, where most of the corn and soybeans I saw were a healthy shade of green.

However, ag suppliers are still very, very cautious. While on my trip, I visited two companies that cater to the ag retail marketplace – one in construction and one in manufacturing. Both reported having good sales during 2010, at least compared with the inactivity that plagued the whole industry in late 2008 and 2009. But both longed for the giddy days of 2006 and 2007, when orders poured in with little or no marketing effort.

“Yes, customers are buying from us this year vs. last year,” said one marketing manager. “But they aren’t just buying to buy new like they did a few years ago. Now, they are being very selective about what they buy, performing much due diligence before making the decision to place an order.”

If this is the new normal in ag retail, I don’t necessarily see this as a bad thing. Being historically cautious has been a hallmark of agriculture for hundreds of years, especially when a one-day severe storm or natural disaster can wipe out months of effort. For one thing, this is making suppliers plan better and work harder to capture market dollars. Looking at this year’s equipment show line-ups, I’ve been amazed at the number of new product offerings being launched for the 2011 season. It seems as if nothing spurs innovation like a little market caution.

In conclusion, I would describe the state of agriculture as anything but unusually uncertain. Things may be unusual in 2010 compared with the past, but they are far from uncertain.

Leave a Reply

Latest News
Roy Blunt
LegislationARA Recognizes Blunt, Heitkamp For Legislative Efforts …
February 17, 2017
Agricultural industry continues to face federal regulatory challenges. Thankfully, agriculture’s allies in the U.S. Senate stepped forward. The Agricultural Retailers Read More
LegislationThe Fertilizer Institute Commends Senate On Confirmatio…
February 17, 2017
The Fertilizer Institute (TFI) President Chris Jahn issued the following statement on the Senate confirmation of Oklahoma Attorney General Scott Read More
Trump, Senate, Cabinet
LegislationBREAKING: Trump EPA Nominee Scott Pruitt Confirmed by S…
February 17, 2017
Scott Pruitt, who as Oklahoma’s attorney general spent years suing the Environmental Protection Agency over its efforts to regulate various Read More
ManagementFebruary Road Trip Edition
February 17, 2017
Editors Paul Schrimpf and Eric Sfiligoj discuss their recent visits to Indiana and Kentucky. Read More
Heritage Cooperative Finished Building Aerial
ManagementHeritage Cooperative, Agland Co-op Approve Merger
February 17, 2017
Agland Co-op and Heritage Cooperative stockholders have both approved the merger agreement between Agland Co-op and Heritage Cooperative. Now begins Read More
LegislationARA Fly-In: Ag Retail Descends on Capitol Hill, Lawmake…
February 15, 2017
More than 100 agricultural retailers, distributors and suppliers headed to Capitol Hill Tuesday morning for the Agribusiness Congressional Fly-in, according to a Read More
Untreated soybean seed Heartland Coop
Seed/BiotechMarrone Bio Innovations, Groundwork BioAg Bio-stacked M…
February 13, 2017
Marrone Bio Innovations, Inc. and Groundwork BioAg, Ltd have announced successful seed treatment field trials of the world’s first all-biological Read More
NL5000 With G5 Technology
SpreadersNew Leader Introduces NL5000 Dry Nutrient Applicator Wi…
February 13, 2017
New Leader, a division of Highway Equipment Company (HECO), has announced the next generation of spreading technology with the NL5000 Read More
Fertilizer Storage
Crop InputsThe State Of The Fertilizer Industry
February 9, 2017
He’s all hat, no horse.” It’s a humorous way of describing a person who tells a good story, but is Read More
CropLife 100Pinnacle Agriculture Agrees To Credit Agreement Amendme…
February 9, 2017
Pinnacle Operating Corp. has entered into an amendment (the “Amendment”) to its First Lien Credit Agreement that will provide for, Read More
ManagementUpdates on Upcoming Trips, Dow-DuPont, and the Des Moin…
February 9, 2017
Editors Paul Schrimpf and Eric Sfiligoj review a few future travels, along with the latest on big company mergers and Read More
Championship Tractor Pull
EquipmentNational Farm Machinery Show Highlighted By Championshi…
February 9, 2017
The scream of monster engines, the stench of burning rubber and the ground-pounding vibrations of the country’s largest, loudest and Read More
Farmer and aptop
Matt Hopkins10 Warning Signs Your Website Is Grossly Outdated
February 8, 2017
Your Website is often a visitor’s first impression of your ag retail business. A positive first impression can set the Read More
Corn Field
InsecticidesArysta LifeScience, DuPont Collaborate On Rynaxpyr Prem…
February 8, 2017
Arysta LifeScience recently announced that it has entered into a global collaboration with DuPont Crop Protection for the development of Read More
Industry NewsThe Fertilizer Institute Board Elects New Chairman, Vic…
February 8, 2017
The Fertilizer Institute’s (TFI) Board of Directors has elected Chuck Magro, President and CEO of Agrium, and Tony Will, President Read More
Sonny Perdue
ManagementARA Joins More Than 600 Organizations In Support Of Per…
February 8, 2017
The Agricultural Retailers Association (ARA) recently joined with more than 600 agricultural groups on a letter of support for Governor Read More
World Agri-Tech Innovation Summit Panel 2016
Crop InputsWorld Agri-Tech Innovation Summit To Be Held In San Fra…
February 8, 2017
“Breakthrough Applications and Business Models for Sustainable Farming” is the theme of the World Agri-Tech Innovation Summit to be held Read More
Cedar Country Cooperative
Eric SfiligojConsolidation In Agriculture: More Middle Movement
February 7, 2017
If you’ve regularly followed my column, you know I’m something of a movie junkie. Like many, one of my favorite Read More