Interest rates will remain low for at least another year and possibly longer.

The economic ups-and-down affect agriculture, but perhaps not as negatively as they do other segments of the economy. Land values remain strong and represent the one positive in real estate. “Demand for agriculture land is fueled by equity capital returns. Agriculture looks very good in relation to other assets and has remained steady over the past few years.”

Energy will influence the agriculture economy. “Corn and oil are closely related in price, which will be dependent on policy. We can produce enough ethanol to meet demand as long as we have the blend wall.”

Up to that blend limit, 15 percent with a recent EPA announcement — “we can produce to demand.”

Beyond that, Conklin says, are problems with infrastructure for blends such as E-85. “We will be limited until we get a fleet of cars available and also infrastructure improvements including investment in new pumps.”

He said some demand may not be price sensitive. “The military has a big interest in direct-to-hydrocarbon fuels. The military has aggressive goals and economics is not as important. Remember $300 toilet seats?”

He said feedstocks for “drop-in fuels” may come from switchgrass, miscanthus and willows, among other biomass products.

Corn prices remain strong. “We are looking at the third largest corn crop in history and prices are near $6 a bushel, so demand is holding up and will remain strong. Food prices also may increase, but will be more modest than some think.”

Wheat and other grain prices have trended downward for years. “Increases in production pushed prices down. That’s been the trend for the last 50 years. Corn demand resulted in a slight upward food price trend in 2004 and 2005, but the long-term trend has been down for real food prices.

“We spend only 10 percent of our incomes for food and we are buying a huge share of food away from home and still prices come down. But is that trend at an end?”

Maybe so. With estimated world population at 9 billion by 2050, demand for food will increase significantly. “Also, incomes will be rising. Now, much of the world’s population lives on $1 a day. As that increases, they will want to improve the quality of their diets, including animal protein and fruits and vegetables.”