A couple of the smartest guys in agriculture had some words of wisdom for farmers attending North Dakota Soybean Expo in Fargo Tuesday.
Michael Swanson, chief ag economist for Wells Fargo, recommended looking at "scope deals" to increase income in the future – especially if you have young people that you are trying to bring the farm or ranch.
"Scope deals" are ventures that expand the scope of your business, not just the scale of it.
Providing custom farming or grain hauling services are examples of enterprises that would increase the scope of a farm business.
"Basically, it's getting businesses that are up or down the value chain from you," he said.
Swanson said he is generally bullish on the agriculture because people in China, India and other countries are likely to earn more money in the future. When they earn more, they will want to eat better food.
But even though the trend line is strongly positive for future growth in U.S. agriculture, there will likely be big year-to-year fluctuations in farm income.
A change in interest rates, value of the dollar or government policy could turn current good times into bad times, he said.
It's not possible to predict when such factors will change, he said, but you need to be prepared and have your business positioned to survive the sudden shifts.
Bill Wilson -- a North Dakota economist who consults worldwide on agricultural trade – said he sees great opportunity for Dakota agriculture because it lies on the edge of the Cornbelt closest to Pacific Northwest ports.
It the lowest-cost region for production and [transportation] logistics for soybeans to China and Asia," he said.
China may soon begin buying much more corn, too, he said.
Another advantage for the Dakotas is its access to shipping containers that are being hauled back to Asia from Chicago. Rather than shipping them empty, they can be filled non-GMO food-grade soybeans and specialty crops.
Wilson advised the North Dakota Soybean Council to invest in projects that will develop new technologies specifically for the region.