Planting Season Tips from an Ag Lender
June 03, 2020
Every spring there’s a sea of tractors out planting the fall
crop. During this time there is usually
one thing on a farmer’s mind: getting the crop out on time. Although, this is the perfect time for
farmers to be thinking ahead on how they can help their lender. How you may wonder? Let’s discuss a few
things to do during planting season that will proactively help you and your ag lender.
1.  ... Continue reading
Conversations with your Ag Lender: 3 Key Components of Financial Analysis
May 20, 2020
ranchers across the United States have felt the pressure of declining margins
over the past few years. With declining margins, proactive conversations with
your ag lender become essential for the financial health of any operation.
Conversations about annual projections, capital purchases, debt structure, and
operating expenses should happen early in the year to allow time for adequate
financial planning. At times these
conversations can feel overwhelming yet having the right tools in place and
understand... Continue reading
INFORMATION TO SECURE A REAL ESTATE LOAN -Why So Much?
April 21, 2020
question from borrowers, especially first-time borrowers, is why the lender
needs so much information? It may seem
like a lot and somewhat unnecessary from the borrower’s perspective, but the
lender wouldn’t be asking if the information wasn’t critical somewhere in the
application, approval, documentation or closing process. Everybody answers to someone, lenders
included, so proper analysis and documentation is paramount for the borrower’s
protection as well as the lender’s.
LET’S TAKE THE MYSTERY OUT OF THIS.
SGMA through the Lens of an Agricultural Lender
April 21, 2020
water supplies and weather conditions in California lack predictability. Over
time the snowpack in the Sierra Nevada mountain range has shown a boom and bust
pattern. The one constant historically relied upon by agricultural operations,
and those financing them, was groundwater, either as a primary or supplemental
supply. Entire operations may have depended on 100 percent groundwater, and
that method was not considered high-risk.
SUSTAINING THE AG SUPPLY CHAIN THROUGH CRISIS
April 13, 2020
and ranchers aren’t immune to the angst surrounding the rapidly evolving
COVID-19 pandemic and the protective measures intended to prevent the virus’
spread. But “social distancing” is nothing new for many people in agriculture
given the nature of the day-to-day work of operating a farm or ranch. Farmers,
ranchers and agricultural workers are doing everything they can to maintain
life and work as “normal.” It’s easier to socially distance in rural America.
Farmers, ranchers and agribusinesses rise to the COVID-19 challenge.
What to Expect with the Loan Process During the COVID-19 Pandemic
April 06, 2020
lenders have in place Business Continuity Plans, but COVID-19 has put them to
the test, with varying results. With
many states enacting stay at home orders to protect the health of their
residents, what remains for many lenders is to move off-site the support
functions, consistent with their Business Continuity Plan.
said, loan-making involves the application and supporting financial information
flowing in a timely and secure manner, much of which is dependent on th... Continue reading
Protecting your operation in these uncertain times
April 06, 2020
With COVID-19 causing disruptions
throughout the US economy, farmers and ranchers are experiencing a wide range
of side effects. While parts of Rural
America have some insulation, certain sectors and areas have seen greater
impacts. Low oil prices and reduced
demand for fuel, as travel has slowed, is wreaking havoc on the ethanol
industry, which has a trickle-down effect on corn prices in areas supported by
ethanol production. Operating on tight
margins, many farmers rely on off-... Continue reading
TIME TO REFINANCE YOUR AG LOANS?
March 25, 2020
economic times often create financial opportunities. The Federal Reserve recently
lowered the federal funds rate to near zero and eliminated reserve requirements,
as it seeks to stimulate the economy and eliminate bank liquidity concerns as
recession looms. Reassessing our farm
and personal financial positions, specifically our debt structures and costs,
must be a fundamental response to the rapidly changing economic environment. But
does a lower funds rate mean you will benefit from refinancing assets lik... Continue reading
Consider cash flow needs, long-term financial consistency
FINANCING NUT CROPS. WHAT IS THE LENDER’S APPROACH?
February 26, 2020
Nut crops favor
very warm climates, and this climate limitation concentrates most of the
production to the far western states.
There are commonalities among the various nut crops, but there are also
come big differences.
Let’s explore what
a real estate lender might be looking for when considering a loan request for
collateral containing nut crops:
Locatio... Continue reading
3 THINGS TO THINK ABOUT IN OVERCOMING CURRENT DAIRY INDUSTRY CHALLENGES
February 24, 2020
in the U.S. dairy industry have been through well-documented struggles in
recent years. Some say dairy industry challenges are causing massive structural
changes and edging out family farmers. Multigenerational dairy farms are indeed
shuttering around the country as consolidation and market pressure force
difficult and sometimes painful decisions when further expansion or
diversification aren’t viable options. Whether it’s a natural evolution of the
dairy marketplace or a consequence of industry changes, it’s a painf... Continue reading
Family dairy farmers face an uphill climb but have options to build efficiency
Women in Agriculture – Navigating Leadership
February 20, 2020
of the modern woman in agriculture has made quite a transformation. Women are taking their seat at the table as
decision makers, CEOs, partners, farm owners, and it is not stopping
there. Women are looking to curate a
solid platform to ensure agriculture remains relevant while ensuring the truth
about agriculture is accurately told. This
has led to the Women in Ag (WIA) initiative which provides tools, resources,
and training to women. WIA, is providing
the space needed to create indu... Continue reading
Financing Permanent Crops in the West: 4 Things Lenders Consider
February 12, 2020
U.S. differs from the rest of the country in many ways. The West, especially California, is one of
the most productive places in the world in terms of food production. California alone produces more than 400 different
commodities in part to the climate, topography, and availability of water
through the complex systems of delivery.
It is important lenders analyze every deal individually, recognizing
there are different strengths and weaknesses with each borrower. What do lenders look for?<... Continue reading
PERMANENT CROPS AS REAL ESTATE COLLATERAL - 4 TIPS TO CONSIDER
February 03, 2020
In the more
temperate climates of the West, there are millions of acres of permanent
crops. Nut crops, vineyards and tree
fruit dot the landscape everywhere you look.
What will real estate lenders be looking for?
When you’ve gone
to your operating lender and they, for various reasons, have decided not to
loan on your real state, then you will need to seek out an experienced long
term ag real estate lender. They will,
of course, be analyzing your cash flow capabilities, but the... Continue reading
PLAN BUDGETS WITH FUNDAMENTALS, NOT GOVERNMENT PAYMENTS
January 08, 2020
last month of 2019 saw signs that there is life in the ag economy. But some of
that life isn't fundamental to the ag marketplace and could throw a wrench in
2020 farm financial planning, making it of utmost importance to stay focused on
sound, fundamental decision-making and not get distracted by things like trade
wars and resulting farm payments.
reports toward the end of 2019 indicated the year was wrapping up with improved
financial performance and resulting sentiment in... Continue reading
Government payments can throw a wrench in long-term budget planning.
3 Looming Factors for Farm Financial Health as 2019 Winds Down
October 22, 2019
With last week's release of the latest Beige Book, the
summary of commentary on current economic conditions in each of the nation's 12
Federal Reserve districts, Fed officials painted a picture of gradual financial
attrition for ag producers in each district. But the data may not paint the
full picture of the impact of declining markets. Loan delinquency, machinery
financing and the ongoing trade dispute are three big factors to watch in the
near future as ag producers wrap up 2019 production.
DON’T LET OPTIMISM GET IN THE WAY OF GOOD FINANCIAL DECISIONS
September 27, 2019
Farmers are eternal optimists, and rightfully so. Raising
a crop takes a lot of hope. Planting a seed in the ground, tending it for
months — through sometimes impossibly challenging weather and environmental
conditions — and expecting a bountiful crop takes both a diverse skillset as
well as the right mentality. Optimism is almost a pre-requisite for being a
But when times are tight and markets strain revenue
potential, this mentality sometimes can be harmful. Sure, ti... Continue reading
September 06, 2019
awareness and adaptability are important to ag lenders.
In a challenging marketplace like the one grain
farmers have faced in the last few years, expanding an operation by adding acres
can be tough, especially for young or less-established farmers. Even when
markets are more bullish, competition can keep some buyers on the sideline when
a nearby 40-, 80- or quarter-section of land becomes available.
No matter the dynami... Continue reading
BUYING FARMLAND? HERE ARE THREE TIPS TO GET IT FINANCED
CREATING A LONG-TERM BUSINESS PLAN
August 11, 2019
Ask the right questions and think like a
lender when assessing your business’s viability.
Planning ahead is a
critical component of any successful ag venture, from the smallest farm to the
largest agribusiness. Though it’s important to think ahead in the short-term to
help guide effective day-to-day work and decision-making, it’s even more
imperative to plan for the long-term success of a farm or ag business.
THREE STEPS TO A SOLID LONG-TERM PLAN FOR YOUR OPERATION
KNOW YOUR CREDIT SCORE
May 28, 2019
It’s a simple three-digit
number that can make a difference worth thousands of dollars in how you finance
and manage your ag operation. Knowing your credit score is important; but even
more critical is knowing how you can improve it. Improving your score can help
in the long run so finance charges don’t add up and erode the revenue potential
of your farm or ranch.
A credit score speaks to
the management of both your business and your pers... Continue reading
Preferential financing options grow with stronger credit scores.
THE BENEFITS OF PLANNING AHEAD
April 22, 2019
It’s a common refrain among too many farmers and
ranchers today: “We know we need an estate plan, but we don’t have it yet.
We’ll get to it one of these days.”
Often, “one of these days” never arrives, then an
abrupt, unplanned change happens — a farm patriarch or matriarch passes away, a
family divide develops, or the next generation steers away from taking the
reins of the farm — and suddenly, you have a major problem. Changing family and
business dynamics means you’re going to have to ma... Continue reading
5 tips to start your estate planning