Newspaper article THE JOURNAL RECORD

Oklahoma Ag Producers Having No Issues Securing Operational Capital

Newspaper article THE JOURNAL RECORD

Oklahoma Ag Producers Having No Issues Securing Operational Capital

Article excerpt

Oklahoma agriculture producers shouldn't have any problems securing operational capital from rural lenders into next year, even as the nation's banks start tightening their lending policies, NBC Bank President Jeff Greenlee said recently.

"Agribusinesses have been concerned about how our customers' financing is going to be affected by everything happening in Washington, D.C.," said Greenlee, who also serves as chairman of the American Bankers Association's agricultural committee.

"The biggest concern isn't over the general economy," he said. "It's making sure that our customers' enterprises are profitable and have cash flow to meet their debt. ... We still have to make sure that their enterprises and commodities can be profitable. That's the bottom line."

National Corn Growers Association Chairman Ron Litterer represented the farmer's perspective of the issue in a recent seminar: "Even before this crisis hit, growers have been faced with higher operating capital requirements due to rising input costs and marketing strategies," he said.

Like Greenlee, he said the ingredients necessary to produce crops - fertilizers, equipment and diesel - have been hurting producers' bottom lines, although fuel prices seem to have dropped back to a manageable expense.

"And with higher production and lower demand, pricing can affect margins," Litterer said at the event recorded by AgriMarketing magazine.

Greenlee confirmed commodity prices have taken hits along with recent economic news, "and that's affecting some of the cash flow projections. But that doesn't necessarily affect what we do. We actually have good revenue in most of our commodities compared with prior years."

And that's reason enough for bankers to make sure America's food engine keeps running, he said.

"As long as we work with our customers' budgets, and understand their input costs and break-even prices are, we shouldn't see agriculture lenders tighten up," Greenlee said. …

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