Academic journal article ABA Banking Journal

In Ag Country, It's A' Waiting Game

Academic journal article ABA Banking Journal

In Ag Country, It's A' Waiting Game

Article excerpt

It is the first week of June now, and the farmers of Yellow Medicine Country have substantially wrapped up their planting for the season. Countywide, a bit more acreage has been sown this year than last. In part, this is because there is less incentive to place land just coming out of a ten-year stay in the Conservation Reserve Program back into the less-attractive revised CRP program. Generally such land was put hack into production.

"That's unfortunate, because we already have a production surplus," says Steve Lindholm, president of Farmers & Merchants State Bank of Clarkfield, Minn. High yields in the face of falling demand helped cause the price crunch that has put so many farmers into difficulty. The general solution seems to be to literally try to grow out of trouble and hope higher yields and a better price will regain some ground. "Many farmers are storing much of last year's grain in anticipation of higher prices," says Lindholm. "They may be forced to sell at current prices, which are low. This is a concern for our customers.

The federal government's mid-May prediction that bumper crops would be seen for the fourth year in a row, nationwide, only underscored what folks were expecting: a poor revenue year. What Lindholm is hoping for is a year of holding on, a year where income is sufficient to help his customers survive into the next growing year.

"Of course, we've been much more fortunate than some other areas, like the Red River Valley," says Lindholm, "which has had poor crops and poor prices. …

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