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Next 24 Months Could Bring Golden Opportunity for Operational Expansion (Video)
By: Dr. David Kohl, Agriculture Economist
TAGS: Grain, Dairy, Swine, Women In Agriculture, Young, Beginning Farmers
 
February 13, 2017 -

Hi, I'm Dr. Dave Kohl, Professor Emeritus, Agricultural Economics, at Virginia Tech, Blacksburg, Virginia, and of course, we'd like to welcome you back to the Macro Clinic. Well, today's subject matter actually came from the road.

An agricultural producer asked me, "What's will the opportunities in ag look like over the next 24 months, particularly with this agricultural reset?" Well, first of all, 60% of U.S. farm ground is going to change hands between now and 2030. Of course, that's 13 years, but as we narrow down to the next 24 months, I think there's going to be golden opportunities to expand, particularly as we see turnover in land. We're starting to see many stressed agricultural producers, financially and mentally, and one of the things is they're giving up some of their rented ground, and also we're looking at a number of older agricultural producers that are thinking about possibly selling land. One of the things that you've got to think about in your business planning is how can we selectively grow the opportunities of business, particularly here in the downturn?

Second, we're definitely seeing thinking outside the box, particularly niche markets. A number of producers are looking at diversifying income streams, others are looking at value-added and niche markets, and one of the things is, if you're going to do that, make sure you have the resources, but also do the business planning process and make sure that you not only have a market, but a backup market, and you've also got to be thinking about two or three markets downstream, because again, if you have a profitable niche, everybody's going to be there.

I think the next 24 months in agriculture is going to be the old opportunity to “get better before you get bigger.” In other words, "better is better before bigger is better." That requires innovation -- actually innovation before technology -- but also, it could be an opportunity to bring the next generation back into the business, or another generation that's outside the family, to re-energize the business.

Again, some of the best opportunities are actually in the agricultural downturn. Everybody wants to be in agriculture when times are good, and I think the next 24 months is going to be a very, very good avenue for business opportunity in the agricultural arena. Next time, we'll see you in the Macro Clinic.

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Dr. David Kohl
Agriculture Economist
Dr. Kohl is Professor Emeritus of Agricultural Finance and Small Business Management and Entrepreneurship at Virginia Tech, Blacksburg, VA.  He taught in the Agricultural and Applied Economics Department for 25 years. 

Dr. Kohl currently energizes agricultural lenders, producers and business people with his keen insight into the agricultural industry gained through extensive travel, research, and exposure during his career.  He has traveled over 8 million miles in his career and conducted more than 6,000 workshops and seminars for agricultural audiences.  He has published more than 1,300 articles and writes for many leading publications. 

Dr. Kohl’s personal involvement with agriculture and interaction with key industry players provide a unique perspective into future trends of the agricultural industry and economy. 
Contact Dr. David Kohl
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