Hoosier Ag Today by: Cayla McLeland
It was a year of inconsistency from field to field and that’s going to affect farmer’s finances heading into a new year. Doug Stark, President and CEO of Farm Credit Services, says the pockets of good crop helped to save the bad.
“Worried about break evens and profitability. And actually, we had such strong profits in a big share of the Midwest that really helped propel these guys to a break even kind of level and maybe even a little profitability.”
Likely most affected will be young farmers. While most are aligned with some kind of family operation, there are three things Stark recommends they take to better themselves in the long run.
“Build constructive, win/win relationships with landlord and actively think about how you manage that landlord relationship besides just giving them a check at the end of the year. So, that. Know your costs and break evens. And engage in a marketing plan. Thirdly, off-farm income is huge as you’re getting started whether it be a spouse working off-farm to cover living and medical expenses or insurance or maybe them working for the family operation of having a job off-farm as well.”
Stark says Farm Credit Services is offering a lot of options for young producers in a difficult market landscape.
“Really looking at reamortizing loans to stretch out payment terms to lower the payments to give them a little bit easier cash flow during the interim. Maybe re-capitlizing their working capital by drawing on some land equity to position their balance sheet. They maybe paid ahead in the last few years so kind of restructuring that. There are some things they can do for this coming year.”
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