For three decades, the cycle was predictable for agricultural bankers: Farmers would use money from the sale of crops harvested in the fall to pay down their debts during the winter. But this year broke the pattern. Farm debt increased during the first quarter, said the Federal Reserve in a report that pointed to trade disputes and burdensome crop stockpiles as the likely causes.
A coalition of 19 farm and advocacy groups and lenders wrote a letter to members of Congress Wednesday urging them not to raise the cap on loans issued by the Farm Service Agency.
Sen. Cory Booker introduced legislation yesterday that would require more transparency and oversight of how poultry loans are allocated by the Small Business Administration. The proposal comes just a week after a report from the Office of the Inspector General questioned nearly $2 billion in loans from the SBA to poultry farmers. (No paywall)
In a report released on March 6, the Office of the Inspector General found that some poultry farmers who had received SBA loans were actually ineligible, because poultry companies “exercised such comprehensive control over the growers” that farmers were not, in fact, operating as independent small business owners. (No paywall)
"Nothing runs like a Deere," according to an old tagline for the world's largest farm equipment maker, and nothing lends like a Deere, either, says the Wall Street Journal. The company, which lends billions of dollars to farmers who buy its equipment, "is providing more short-term credit for crop supplies such as seeds, chemicals and fertilizer, making it the No. 5 agricultural lender."