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2/20/2008 4:27 PM
February 16, 2008
Diverse 'tidal wave' of investors turns to farmland
By JERRY PERKINS and LYNN HICKS
Register Business Writers
Although the U.S. economy appears to be cooling, the farmland market is cooking.
Farmers, investors and even Wall Street hedge funds are looking to farm country, searching for
a safe haven for their money.
"We're teetering on the edge of a recession," Don DeWaay of DeWaay Capital Management in
Clive said Friday at a land investment expo in West Des Moines.
Yet, despite the slowdown in the overall U.S. economy, DeWaay said, it might be a good time to
buy farmland, but he urged potential buyers to be cautious about how much they pay for it.
"There will be a peak" in the farmland market, DeWaay said. "The good times don't last forever."
Another speaker at the land expo, Moe Russell, president of Russell Consulting Group, said
higher prices for corn and soybeans, increasing farm production costs and double-digit growth
in farmland prices have combined to make farming riskier than ever.
"The risk has increased about 16 times in the past few years," Russell said.
Despite the higher risk, Russell said, he is bullish on agriculture.
"If you do the right things, you'll be successful," he said. "If you don't, you're history."
Diversification is a key for investors looking for a place to put their money, he said.
"If you don't own farmland, look for some," Russell said. "There are good deals and bad deals.
Do your due diligence before you buy."
Iowa farmland prices set a record in 2007 for the fifth year in a row, according to Iowa State
University's annual farmland survey in December. Prices rose to an average of $3,908 an acre,
22 percent more than 2006. It was the largest one-year increase since 1976.
Other surveys have shown farmland prices also are on the rise in the eastern and western Corn
Although farmers are the largest buyers o