Farmers attending the Indiana-Illinois Farm Show are checking out the newest in farm equipment. And, at the Hoosier Ag Today seminar on Tuesday, growers were told that now may be a good time to buy. The seminar featured a panel of bankers and CPAs who made the case that now is the time to consider making an investment in new equipment. Joshua Sickler, with Sikich CPA, says tax law changes in 2014 will eliminate some major deductions, “The bonus deprecation section 179 will be reduced from $250,000 to $25,000 beginning January 1 of 2014.” He advised that growers who may want to offset income in 2013 might want to consider investing in equipment.
Matt Monteiro, with Farm Credit Services of Mid-America, says another reason to buy now is that interest rates are will low, but are expected to increase in 2014, “There has been a recent increase in interest rates and that is not unexpected, but they are still at historically low levels.” He expects rates to continue to increase in 2014, but does not foresee a rapid rise in rates, “They tend to go up a lot slower than when they are coming down.” He told the seminar he does expect both shorter and long term rates to be higher at the end of 2014 than they are today.
Monteiro says now would also be a good time to lock in some long-term interest rates, “Locking in a low rate for a long period of time gives a farmer the certainty to know what his costs will be.” He recommended growers talk with Farm Credit Services about locking in a long-term rate. Currently, Farm Credit has an operating loan special that offers a 2.9% rate.
The HAT seminar series continues at the farm show on Wednesday with a presentation by Indiana Lt. Governor Sue Ellspermann and Purdue Ag Economist Dr. Chris Hurt. The focus will be an outlook at Indiana agriculture from both a policy and an economic perspective. The Thursday seminar will focus on the futures market with presentations by Jim Riley of Riley Trading and Tom Fritz of EFG group in Chicago. The seminars begin daily at 11am.