As keynote speaker for the second annual Tech Hub LIVE event, agricultural economist David Widmar offered his insights on where we are in the farm economy production agriculture business cycle, some key demographic trends, and some key conversations to have with growers.
Widmar, who is managing partner at Agricultural Economic Insights (AEI), says one of the main favorable factors in the current farm economy is an increase in oilseeds demand. “We’ve seen it here in the U.S. but also around the world,” said Widmar. “It’s soybeans in South America, sunflowers in Eastern Europe, and it’s rapeseed in India.”
As far as the demographics is concerned, Widmar pointed out that we all know that the average age of farmers continues to increase with more than two-thirds of producers over the age of 55. What that has caused is larger and more complex family farm operations. “So, we need to make sure we have a relationship with the farm team and not just one individual, more of a business,” he said.
While we tend to focus our attention on the big commercial growers, Widmar encouraged attendees to think about how they can meet the needs of producers in other categories. “There’s still 90 percent of farmers who are residential or intermediate involved in the farming economy. They might not buy as much but they may have other disposable income they could use to make investments in that lifestyle or budding enterprise.”
Finally, Widmar talked about conversations to have with growers. “Think about talking about ROI as a starting point for a much deeper conversation about investments and the types of returns various products can deliver,” he said. Using homeowners’ insurance as an example, Widmar pointed out that there are different types of return on investment and not all involve money.
Incidentally, Widmar and AEI.ag have produced two in-depth and award-winning ag economy podcast series. “Escaping 1980” explores the causes, impacts, and lasting effects of one of the most infamous events in American agriculture history, the 1980s farm crisis. “Corn Saves America” is about agriculture’s role in environmental solutions, comparing the rise of corn ethanol with today’s carbon markets.