Monday, April 18, 2011

"Volatility and Record Risk in Agriculture?"

There is a report at of a meeting involving 75 bankers and lenders from across the state of Texas for the "91st annual Agriculture and Rural Affairs Conference."

Of particular interest was the summary of the comments by Mark Pearson, host of “Market to Market,” who presented his global outlook on agriculture:
While there is some economic recovery and an improving consumer confidence, he advised the audience to watch China’s military and economic actions, the growing youth population in the Middle East, industrial developments in Africa and the increasing world demand for food and agricultural products. Lenders will need to understand what is happening in the world and not just the U.S. agriculture sector in order to maintain their businesses and be prepared for changes in this current market environment, Pearson said. “We are in volatile times and that’s not going to change. As agricultural lenders, never before has your expertise been in such demand,” he said. “If you are in any sector of agriculture, you are facing record risk today.”

Does that last line sound extremely bearish, or is it just me?
K. McDonald