WASHINGTON, June 14, 2017 – A group of 21 farm and lending organizations, including the National Farmers Union and the American Bankers Association, is urging the leaders of the House and Senate Appropriations committees to make sure the country’s farmers and ranchers have adequate access to credit as they face another year of difficult economic conditions.
“With the farm economy only expected to worsen, access to credit, specifically credit provided through the U.S. Department of Agriculture Farm Service Agency’s Farm Loan programs, is critical,” the group said today in a letter to the lawmakers, stressing the need for a strong safety net for the nation’s farm community.
The group acknowledged the assistance Congress provided in the 2017 omnibus spending bill (the 2017 Consolidated Appropriations Act) by adding roughly $1.4 billion to FSA’s Farm Loan programs, for direct and guaranteed farm operating and farm ownership loans. It called that action “an important and necessary step in ensuring continued access to credit.”
The group noted, however, that metrics associated with the farm economy, including debt to asset ratios, working capital, and cash flow, are expected to weaken further this year or stay the same as 2016. And, with farm income down 50 percent in the past four years, they expect demand for new or revised loans to at least match that of 2016, meaning FSA will need additional resources in the future, including “adequate lending authority and state mediation grants that reflect the growing stress in the countryside.”
While recognizing that budget restrictions weigh into such calculations, the group urged the lawmakers to “match this demand with an appropriate level of resources for FY 2018.”
The letter concluded: “Inadequately funding FSA would be a disservice to our hardworking farmers and ranchers, who are dedicated to feeding our nation and the world.”
The organizations signing the letter include: the Farm Credit Council, the National Association of Wheat Growers, the National Corn Growers Association, the National Milk Producers Federation, the National Rural Lenders Association and the Independent Community Bankers of America.