Financial stress will increase
Agribusiness professionals expect financial stress to increase, according to a recent survey released by the Center for Farm Financial Management at the University of Minnesota. Financial stress will become high or very high for farmers over the next three years, in the opinion of 84% of the 2,300 survey respondents, who are based in all 50 states. Among lenders only, that number does drop slightly, however, to 80%.
Today, financial stress is relatively low, but it is expected to increase. Twenty-eight percent of the respondents said that more than 30% of their clients will begin feeling financial stress in the next three years (see chart).
More farming women
The number of female farm operators rose nearly 30% between 2002 and 2007, according to the 2007 Census of Agriculture. Of the 2.2 million farms in the U.S., 306,209—or 14%—are run by women.
Their operations are equally likely to focus on one of three industries: cattle, calves and feedlots; aquaculture and other livestock; or crops.
Positive feelings are fading
Despite an onslaught of tough news for the general economy, farmers remain relatively positive about their own financial health and the condition of the overall farm economy. But it's starting to slip, according to a running survey of Top Producer readers.
Negative sentiment about the overall farm sector has increased with each survey since October, while readers' generally positive feeling about their own farm has declined during the same period. —Greg Vincent
Equipment leasing options expand
AGCO is the first equipment manufacturer to offer a short-term equipment leasing program for combines. The program, called Harvest Solutions, is being launched this spring in the High Plains and western Corn Belt with five combines. "We start out in the wheat harvest, move into soybeans and finish it out with the corn harvest in the Midwest," says Todd Stucke of Harvest Solutions.
The program is offering the Challenger 670B combine with 350-bu. capacity, available with a 30' or 35' platform and an 8- or 12-row corn head, says Kevin Cobb, senior marketing manager.
"The grower may already have one machine and require a second one during fall harvest for a corn and soybean operation, when you're needing to do both crops," Cobb says. "This program allows a fixed cost per acre for the grower to work with. Also, smaller operators who cannot justify owning or renting the combine on their own may get several growers together to rent the machine."
The hour range requirement is from 100 hours to 200 hours, depending on location and crop. Generally, the wheat market requirements are 100 to 125 hours and there are 200 required hours in the corn market.—Greg Vincent
Ag land ownership has remained stable over the past five years, according to USDA's 2007 Census of Agriculture, released last month. Operators own 62% of the farmland, while 38% is rented. Areas with a lot of farmland, such as the Midwest and along the Mississippi River, have the highest percent of rented ground.
The average age of U.S. farm operators rose from 55.3 years in 2002 to 57.1 years in 2007, the Ag Census reports. The number of operators 75 years and older rose 20% (and over 65, about 17%), while the number under 25 years of age fell 30%. In fact, even the group under 45 years old dropped more than 20%.
Editor's Note: Regarding the letter in the January issue (Letters) responding to a "Top Line" column about the trend to bigger farms, the writer, Brian Bruckner, would like to go on record that the opinions put forward are his personally and not necessarily those of his employer, the Lower Elkhorn (Neb.) Natural Resources District.
"Inheriting respect is easy. Keeping it is hard." John Ward, author of Perpetuating the Family Business
"I doubt I've ever seen such divergence in retailers—some have done very well and some have really got caught." David Downey, Purdue University economist
"Go forward confidently, energetically attacking problems, expecting favorable outcomes." Norman Vincent Peale, author and minister
"One of the underutilized assets on farm businesses is human assets." Dave Kohl, Virginia Tech University ag economist
"In a family business, it is not always easy to speak truths with love." Garrett Thompson, Laminators Inc., Hatfield, Pa.
Top Producer, March 2009