With commodity prices markedly higher, farmers around the nation are capitalizing on the prosperity and investing in and upgrading their machinery, according to published accounts.
Combine sales in October 2010 were 24 percent than they were in October 2009 while sales of tractors for all of 2010 have increased in excess of 5,000 from last year. Sales of four-wheel-drive tractors, which are larger and more expensive, have increased nearly 27 percent for year to date. And corn and soybean prices are 60 percent higher now than they were in June.
"The ag economy is strong right now compared to the general economy, and that breeds new investment," Brent Carpenter, an analyst with the Food and Agricultural Policy Research Institute at the University of Missouri, told the Cattle Network.
Joe Spatafora, a farmer who recently was shopping for a new combine in Missouri, said the past three-plus years have been good to farmers and their crops. He said even the amount of rain has been sufficient, also noting he wants to continue moving forward by keeping his equipment modern.
"Farmers are replacing and buying new and larger equipment, which is showing up not only in strong sales for larger tractors, combines and pickups but also grain bins and computers," Carpenter said.
Risk Disclosure
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.
