“Tough conversations are ahead": Ag lender warns as the capital shrinks

Bankers from across the country are warning tough conversations are ahead.

In a Senate Ag Committee hearing this week, one loan officer testified capital is running out across farm country.

“What we’re seeing is continued significant earned network losses across the board. Talking to lenders down in that area, and as well as what I’m seeing in the Midwest, is certain parts of the Southeast part of the country are on year 2-3, if not 4, of losses and having two bankers are starting to work out plans, and having uncomfortable conversations on ‘what is the end game here?’ When I look at the Midwest coming through renewal season, we were able to get all of our renewals completed this year, but those conversations are ‘what is the burn rate of working capital?’ It’s creeping up on us much faster,” said Caleb Hopkins with First Dakota National Bank.

While there could be a rocky road ahead, producer sentiment is up. Economists with Purdue University say the ag economy barometer rose 11 points last month. However, the report showed little change in how producers feel about future prospects.

Related Stories
Vive’s Art Graves shared insights on the new Phobos FC 360 foliar fungicide, its advantages for Canadian growers, early performance results, and the company’s ongoing commitment to advanced crop protection solutions.
F-10 Wound Spray can now be used for livestock and other animals as officials monitor the ongoing New World Screwworm outbreak in Mexico.
China’s stricter inspection rules prompt Cargill to pause soybean exports from Brazil, briefly lifting U.S. soybean prices as traders anticipate potential shifts in global trade, as export demand remains supportive across all major U.S. commodities.
Suderman joins Tony St. James in the RFD Studios to discuss how geopolitical tensions are triggering global transport disruptions, new inflation pressures, and other challenges for agriculture to navigate.
RealAg Radio’s Shaun Haney shares insights from new Real Agri-Studies research surrounding the relationship between farmers and their lenders and what it reveals about the current farm economy.
Farm Bureau economist Dr. Faith Parum explains how geopolitical dynamics in the Middle East could further tighten fertilizer movement, increase fuel costs, and complicate planting decisions for U.S. farmers this spring.

LATEST STORIES BY THIS AUTHOR:

NRECA CEO Jim Matheson warns that rising electricity demand from AI and data centers could strain the grid and affect rural electric cooperatives if U.S. power infrastructure cannot keep up.
Tidal Grow’s AlignN delivers encapsulated nitrogen to leaves, boosting in-season response, yield gains, and farm profits.
Katie Keener with the National Women in Agriculture Association joins us to celebrate women in agriculture and spotlight programs and initiatives aimed at empowering female producers across the country.
Nationwide’s Elizabeth Duncan and Traci Via with Agriculture Future of America highlight the impact of women in agriculture and how mentorship and partnerships empower future farmers and ranchers.
Jake Charleston of Specialty Risk Insurance offers his perspective on current cattle market conditions and shares advice for producers seeking to stay protected in an uncertain market.