Panelists provide outlook for 2009

John Cripe, GROWMARK manager, energy risk management, offered a unique perspective on the energy outlook for 2009 at the Iowa Farm Bureau Federation Annual Meeting in Des Moines in December. Cripe was one of three panelists on the risk in the agriculture industry. He was joined by Jim Knuth of Farm Credit Services of America and Bruce Nelson of FC Stone LLC.

All agreed that recovery from the current economic crisis may take as long as 18 months, although the specifics are difficult to gauge. "We basically caught a cold and the rest of the world got sick," Cripe explained.

The three panelists agreed on some common themes: we're not repeating the 1980s as the bulk of farmers don't have high debt loads and interest rates are quite low; the grain markets are difficult to predict and volatility will return to the marketplace; and energy prices are difficult to predict long-term. "We tend to bottom out in the winter time," he said. At the same time, it's very possible that the dramatic downturn in energy prices will be short-lived, he said, noting there may be an abrupt turn-around in a few months.