How Farmers Are Financially Preparing for the Future
AgAmerica CEO and President, Brian Philpot, recently discussed the changing economic landscape in agriculture from a financial perspective with the voices of the Global Ag Network, Delaney Howell and Mike Pearson. Below are some highlights from the podcast, including how to build working capital to cover input expenses through ongoing uncertainty.
Understanding how working capital can cushion your operation during a volatile economy.
COVID-19 in the past month has uprooted millions of people across the nation affecting the way they live their lives and provide for their families. As the nation’s economy shakes with closures of non-essential businesses, lack of consumer spending and school closures playing a significant role in this, planning for the future of your farm operation when interest rates are low has never been more important.
Read to learn what a SWOT analysis is and how it can help your farm succeed.
A SWOT analysis is an advantageous strategy when considering any possible changes to a farm operation. It can also be used to assess past successes and failures while creating future goals. A SWOT analysis organizes thoughts, brainstorms, evaluates and compares potential ideas to bring in additional revenue for a farming or ranching operation. It has the unique ability to show gaps within a business model and highlight possible solutions to existing problems.
Here’s an understanding of what takes place during a loan closing for an agricultural land loan.
So, you’ve been approved for a loan. You’ve done everything you needed to do—provided all the necessary information and worked with the lender to agree upon terms for your land loan. As you transition into this final stage of securing the loan, you might be wondering what happens next. The closing period is a very important time, both for you as a borrower and for the lenders themselves. There are several factors that can affect how long it takes to close on a land purchase, so understanding what to expect during the loan closing stage is important.
Your credit score matters—but it shouldn’t keep you from securing the financial support your farm needs.
There are many reasons that you may need a farm loan. Perhaps you want to expand your operation by purchasing more land, or maybe you need to invest in new technology to optimize your production capabilities. Whatever the case may be, it’s likely that at some point your operation will need more working capital to sustain the fast-pace demand of food production.
Alternative Options to Traditional Agricultural Loans.
According to the U.S. Department of Agriculture (USDA), farm debt will hit a record high of $416 billion by the end of 2019. Farmers are leaning on lenders now more than ever, not just during the hard times, but to finance new opportunities like farm expansions, equipment updates, and more. So why are farmers choosing alternative lending companies to help open these doors?
Know what documents are required when applying for an agricultural loan.
Most farmers and ranchers will agree that time is a limited resource that impacts all aspects of their operation. As we’ve come to witness first-hand in working with our nation’s farmers and ranchers, the expectations around the loan application and approval process are rather low and not exactly positive.
5 Tips for Reducing Risk and Increasing Profits.
There are so many factors that go into running a profitable farming operation. In an industry that faces several influencing factors such as new technology, government regulations, and climate change, the potential impact on your operation’s bottom line is high.