What Are Ag Lenders Looking For In New Farmers

Agriculture lenders in recent years have increased support and ease of financing for beginning and young farmers with the hope of creating easier entry into farming and ranching.  What are some of the attributes is the USDA look for in these new farmers?

"From a cost perspective, they can compete very, very well,” said Tim Cook of Farm Credit Services. “What they don't necessarily always have is the liquidity in equity to absorb some of those short-term loses. So, what that means is young and beginning producers need to sharpen that pencil and ensure that they are a low-cost producer.

“And then what we see is that they generally have a little more discipline from a marketing standpoint,” Cook continued.  “Over the last several years, the markets have given producers an opportunity to hedge their crops at profitable levels. Obviously, not all of them have taken advantage of that but, for the most part, young and beginning producers are more apt to use hedging and marketing strategies, which helps them significantly."

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