8 March 26, 2015 2015 Logan County Farm Outlook Magazine Lincoln Daily News.com
With higher cash rents, obligations for machinery
and buildings, calls for higher wages, wear and tear
and maintenance, continued growth in technology,
escalating cost of living, and less overall income,
Logan County producers are feeling the squeeze and
some are even upside-down. The only current uptick
is that fuel prices are lower. Careful management
of cash reserves from year-to-year can help balance
the shortfalls, but other strategies for coping with
dwindling income are needed.
Rick Harbarger, ag loan specialist from
Town and Country Bank
(formerly Logan County Bank) writes:
As agriculture faces landmark changes across the field,
farmers are assessing not only their base acreage and
crop insurance but also their overall position forward
looking ahead of market adjustments. Adding to the
uncertainty are the possibility of $3.50 corn coupled
with the lack of a Renewable Fuels Standard – and the
increasing likelihood that a new RFS would call for
as much as 3 billion gallons less than in 2007. Cash
position and liquidity are an important component of
today’s successful farm income equation, and a strong,
knowledgeable farm lending partner can play a huge
role in keeping your budget right-side up.
Growers will start to feel a dwindling cash flow and
many who are upside down on farm budgets may start
dipping into their cash reserves to make ends meet.
You can help soften that risk by working ahead of time
to make adjustments, working closely with your lender
to carefully scrutinize cash rents and input expenses.
By giving your lender an in-depth understanding of
your farm, how you run your business, and where your
challenges lie, they are better able to help you adjust
to the market and identify solutions to help grow your
business. So, that by working together you can help
keep your farm finances in shape.
In this edition of Farm Outlook, we take a look at
strategies for reducing costs and raising incomes to
cope with these challenging economic times.
Because, as goes the farm, so goes the community.
Story by Jim Youngquist
