Farmer Access to Credit Still Tight

January 7, 2009 06:00 PM
 

Jeanne Bernick, Top Producer Issues Editor
 
The last 12 months are a taste of what producers will continue to see in terms of access to credit, says Emily French, associate director, Treasury & Commodities Group Macquarie Bank. French spoke at the Farm Journal Forum last month in Washington D.C.
 
"For the spring of 2009 farmers should expect to see continued limited access to liquidity,” French says. She expects credit to remain tight for at least three years.
 
The global economic crisis has blasted credit and left many bankers in a situation of not quite knowing what to do, she says. "This is a historic episode in world credit, and a lot of us are stepping back and watching for awhile before we make big decisions.”
 
She does advise farmers to lock in some price risk. And if you have an opportunity for a profit, French says: "take it rather than looking for the moonshot.”
 
The bright side right now for agriculture is that global demand for food has not diminished. "We haven't seen the massive demand destruction for food like we have seen in other sectors globally with the financial crisis, and this bodes well for agriculture,” French says.
 
Still, farmers cannot be lax on watching the markets. "The worst thing U.S. farmers can do is not to be educated about the markets or selling their crops,” says French. "You have tools. Learn to use them.”
 
Listen to an exclusive audio interview with Emily French of Maquarie Bank.

 
 
 
For More Information
 

 
You can email Jeanne Bernick at jbernick@farmjournal.com.
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