“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
Galynn Beer of Tidal Grow Agri-Science joined us to discuss challenges in fertility management, the benefits of Align-N, and what growers can expect at Commodity Classic next week.
Iowa farmer Derek Hommer joined us to discuss grain bin safety, ongoing prevention efforts, and the importance of community preparedness during Nationwide’s Grain Bin Safety Week.
Tommy Roach with Nachurs Alpine Solutions discuss fertilizer decision-making, plant fertility strategies, and what farmers can learn at Commodity Classic.
The U.S. Supreme Court ruled on Friday that imposing duties without Congressional authorization exceeds presidential powers. RealAg Radio host Shaun Haney joins us to discuss the potential trade and agriculture implications of the recent ruling.
Fertilizer still consumes an unusually large share of crop value.
Kerry Hartwig from Sukup Manufacturing previews the grain management solutions they plan to share with producers at the upcoming Commodity Classic in San Antonio.

LATEST STORIES BY THIS AUTHOR:

The Midland County Junior Livestock Show in West Texas features a competitive steer showcase highlighting top-quality cattle and the accomplishments of driven youth exhibitors.
CoBank Knowledge Exchange’s Jeff Johnston shares the group’s positive perspective on expanding data centers into rural areas and weighs the risks and rewards for those communities.
Farm CPA Paul Neiffer discusses how January’s WASDE report could impact ARC and PLC payments and updates on disaster relief programs as farmers navigate a challenging market environment.
Texas Commissioner of Agriculture Sid Miller joined us to discuss data center expansion, farmland preservation, rural economic impacts, and imminent cattle biosecurity concerns affecting agriculture today.
The Pennsylvania Farm Show continues through Saturday, wrapping up another successful year of celebrating agriculture in the Commonwealth.
Shaun Haney joined us to discuss Canada’s new trade agreement with China, the potential impact on farmers and exporters, and what it could mean for U.S.–Canada trade relations going forward.