The AGgregator

Farm Credit Experts Speak with Executive Women in Agriculture

Farm Credit Experts Speak with Executive Women in Agriculture

Changes in the agricultural sector are affecting the value of agricultural assets—land, equipment and grain inventories—that show up on farmers’ balance sheets, and will have an impact on owners’ equity and working capital.

That's the view of Sarah Lukach, an agribusiness commercial lending service officer with 1st Farm Credit Services in Normal, Illinois. Speaking this winter at Top Producer Magazine’s 6th annual Executive Women in Agriculture Conference in Chicago, Lukach told attendees that USDA’s annual real-estate valuations, released in August, reflect a national decline in real estate values of 0.3 percent. Regional valuations, however, have declined by a slightly larger percentage depending on location, soil productivity and land characteristics. In some regions, values increased.

“Producers need to consider the real, current value of their assets and be realistic when putting them in their balance sheets for business valuation,” Sarah said. Her presentation, Farming and Financing During Challenging Times, focused on the general ag economy and the actions producers should take to prepare for the impact of those shifts.

Sarah believes that cash flow and liquidity will become more critical in the current environment. Producers will need to develop customized plans for implementing risk management tools that will help sustain profitability for an operation in tight economic times.

Almost 250 producers and agribusiness professionals from 28 states and Canada attended the conference. Among them was Sherri Tomhave, a risk management product and training specialist with Farm Credit Illinois. Speaking on the topic of Untangling Your 2017 Crop Insurance Decisions, Sherri provided updates to crop insurance options for the coming crop year. She emphasized that the responsibility for crop insurance policies rests with policy holders—not insurance agents. Producers are also obligated to document changes to operation that occur after a policy is put in place.

"Producers shouldn't assume that their agent knows their operation as well as they do - or knows about any updates they've made to acreage, facilities, crops or other issues that impact their crop insurance coverage," Sherri says. "They need to have frank conversations with their agents so the best policy can be put in place to mitigate their risks.

Sarah and Sherri were first-time attendees at the Executive Women in Agriculture conference.

“The group was very diverse in terms of crops, farm size and locations, but it was very clear that every woman there is supporting their operation100 percent, whether they’re there every day running a combine or making marketing and purchasing decisions, or if they’re also working off-farm jobs,” Sherri says. “These women are dedicated to their operations because they want to be able to pass them on to the next generation.”

While the production agriculture sector is experiencing tougher times; Sarah indicated optimism was still strong amongst the attendees and peers.

"Even though we're looking at a challenging 2017, many producers have paid down their debt over the past few years with the profitability they've experienced from higher commodity prices," she says. "There's still a lot of optimism, and the industry is still strong."