Don’t Make a 20-Year Decision Based on 1-Year Results

When it comes to big purchases—especially land—too many business owners fall into the same trap: making a 20- to 30-year financial commitment based solely on how things are going right now.

This mindset isn’t unique to farmers. It happens across every industry. But in agriculture, where volatility is part of the deal, the consequences can be severe.

Most people run the numbers on a land purchase based on today’s prices, today’s yields, and today’s margins. If it pencils out right now, they assume it’ll work long-term.

But here’s the problem: you’re not buying that land for just one year.

You’re locking in a long-term obligation—often 20 years or more. And over that time, a lot can change. Commodity prices dip. Input costs spike. Interest rates rise. One bad year becomes two, and suddenly, that land payment starts tightening the noose.

What happens when corn is $3.50 instead of $6.50?

What if your input costs jump and margins evaporate?

Can your operation still cash flow that note? If the answer is no—or even maybe not—then you’re not making a sound business decision. You’re gambling.

This doesn’t mean you shouldn’t buy land. It means you should run the numbers not just for today, but for a range of scenarios. What does your business look like when the market turns?

If you can’t cash flow it at all-time lows, then you need to ask yourself: what’s the real risk here? And are you prepared to deal with it?

That’s the mindset of a business owner—not just a producer.

If you want to build something that lasts, your decisions need to reflect the long game.

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