House Ag Committee hears YBS farmer concerns over loans, production costs
An Illinois farmer says USDA loan programs for young, beginning and small farmers should me more flexible to help offset the cost of producing a crop.
During a hearing House Ag Committee hearing Thursday, Adam Brown told lawmakers the lack of capital has squeezed his bottom line at a time when input costs are skyrocketing. “Government programs certainly can’t make up for every cash flow problem a farmer may face. Tight margins over the last few years have forced us to find ways to tighten our budget to make ends meet including the liquidation of non-essential farm equipment.”
Ag economist Nathan Kauffman with the Kansas City Federal Reserve says he expects an increase in farm loans over the next few years. “Capital spending is expected to decline in the coming months for the first time since 2020. Numerous contacts have pointed to large increases in costs associated with fertilizer, fuel and labor as primary drivers of higher expenses and a less favorable industry outlook.”
Kauffman says a sudden drop in commodity prices could make profit margins even thinner and reduce overall capital.
Brown and Kauffman testified during a hearing on a review of the Farm Bill: The State of Credit for Young, Beginning and Underserved Producers.