shaking hands

Younger farmers are a growing portion of Farm Credit borrowers

Younger farmers borrowing from Farm Credit share 6 tips on what's important to grow next-gen businesses into the future.

Farm Credit System’s celebration of 100 years brought a noteworthy focus on younger farmers. Traditionally thought of as a lending source for established farm and agribusiness enterprises, this spring’s Farm Credit 100 events in the nation’s capital underscored its growth as a financial and management resource for young, beginning and small-scale farmers and ranchers.

The events, kicked off during National Ag Week, brought a lot of synergy and focus on younger farmers. “A lot of beginning farmers aren’t so young,” points out Todd Van Hoose, president and CEO of the Farm Credit Council.

To better track loans made to this segment, Farm Credit associations split young farmer/rancher loans into three groups: Young – those 35 years and younger; beginning – those farming 10 years or less; and small – those with gross annual sales under $250,000.

New loans to these groups rose 3.5%, 4.0% and 2.3%, respectively, from 2014 to 2015. Dollar volume of loans increased 6.0%, 6.4% and 2.3% respectively from 2014 to 2015.

“We make specific efforts to meet their unique financing needs to help them thrive even as lower commodity prices put pressure on farmers,” adds Van Hoose.

The event included a panel discussion by young farmers and ranchers exploring opportunities and needs for next-gen agriculture. Here’s a quick-read:  

Wild horses couldn’t keep Oldham from ranching
Odessa Oldham, a Navajo sheep and cattle rancher from Lander, Wyo., was honored earlier this spring as a Farm Credit 100 influencer. As a 13-year-old, she started her own cattle operation with a Farm Service Agency loan, and today partners with her brother and parents in pasturing 600 head of all-natural beef and lamb on their father’s 900-acre Double-D Beef ranch.

They market in package deals or on the hoof. “As a business, we sell our product, and offer education. The local FFA chapter comes out to learn, and participate in daily chores.”

Getting off the reservation [or farm] and getting an education is imperative, she stresses. It opened her eyes to opportunities and spiked her inspiration. After doing so, she became a founder of the Native American Youth Agriculture Summit in association with the University of Arkansas’ Indigenous Food & Agriculture Initiative.

The Double-D is the newest of three wild horse sanctuaries in America. And Oldham has earned a new title of Wild Horse Cultural Educator.

Oldham sees financing as the biggest challenge. “When we started, we went to FSA, then Farm Credit. Commercial banks still often don’t understand the business of agriculture. We [young farmers] need to be taken seriously.”

Veterans need experienced ag mentors like Ingrao
Adam Ingrao, an Army veteran and executive director of the Farmer Veteran Coalition of Michigan, is a National Science Foundation Fellow at Michigan State University. His entomology expertise in sustainable pest management led him back to establishing an urban farm in Lansing.

In January, Bee Wise Farms, LLC was established as a Community Supported Agriculture project and acquired more land on the city’s east side. “I can’t make a whole lot of income living off the land, yet,” he concedes, but adds, “Coming back from the military was a very rough time for me. Agriculture was an opportunity for personal wellness.”

He and wife, Lacey, provide the greater Lansing community with organically-raised vegetables, cut flowers and bee products. They also have educational and wellness outreach programs, including the Veteran Mentorship program, teaching veterans about urban bee-keeping.

One widespread problem, contends Imgrao, is: “There’s no zoning for urban agriculture. Without it, we can’t create opportunities where there’s a real need.”

What’s most needed? One-on-one with someone – a mentor – who’s been there and done that, who knows the pitfalls, he emphasizes. As a veteran, he’s trying to fill that role, and has helped three individuals develop business plans. “We make certain they know who’s out there to help them in terms of resources.”

Farming is a numbers game for Pottinger
At age 27, Quint Pottinger has accomplished more than what many farmers hope to do in a lifetime. In 2012, after graduating from the University of Kentucky with an ag economics degree, he bought his grandmother’s farm and named it Affinity Farm.

Sharing machinery with his father, Ramy, the partners farm close to 1,500 acres of corn and soybeans at New Haven, Ky. Quint and wife, Leah, also grow vegetables as part of a community outreach. “It’s a good way to connect with the public about how their food is grown,” Quint explains.

“There are just a few people my age out there who are farming on their own,” he says. “There are even fewer who engage in policy or international trade work.”

He’s a director of the Kentucky Soybean Association, Kentucky FFA Foundation, serves on the Corn Farmers Coalition and was recently appointed to the U.S. Soybean Export Council. His activism led to him being named a 2014 White House Champion of Change.

An evolving business plan and on-going cash flow analysis are key tools for this young farmer – that plus “brain sweat” and self-discipline. “Some people don’t want to do what it takes to be a farmer,” he maintains. “If you’ve got a job, save your money because you’re going to need it to invest.”

“Cash flow helps you analyze ‘This is where I want to be’,” he says. “Then you need a plan on how to get that point. It’s a process to get where you want to be.”

“GPS technology has changed the efficiency of our farm. It helps control planter rows and keeps us from overplanting or over-fertilizing. Spreading that over 1,500 acres, inaccuracy can cost thousands – or save thousands,” adds this Kentucky farmer.

Business plan proved crucial to Tiffanys
“Our story is a little different,” says Shane Tiffany, Tiffany Cattle Company, Herrington, Kans. “Our family didn’t have ownership and didn’t have a lot of resources.”

But during the summer of 2007, Shane and brother Shawn returned home after college and cattle industry jobs with a business plan to acquire a commercial feedlot. With the feedlot owner’s backing, Farm Credit stepped in to help. Today, they feed 30,000 head of cattle, farm 1,500 acres and graze 2,500 head of their own cattle.

Access to capital is crucial as farms grow, stresses this cattleman. “Without our business plan, we’d be lost,” he acknowledges. “At any point, it’s crucial to know where we’re at. And, we have consultants and advisors over every single aspect of our operation, particularly with our partnership and older owner.”

6 tips for start-up farmers

1. Most farms fail in first five years for the lack of business planning. “You must first understand today’s business environment,” says Ingrao. “You can always learn plant and animal science. But knowledge of the business atmosphere is really the first step.”

2. Farming is one of those things you’ve got to know how to do, adds Tiffany. “Get a job and experience before you dive in. Then you’re better prepared to figure out if it’s really what you want to do.”

3. Embracing technology is a must, contend these go-getters. “We can’t produce what we do today without the technology, especially when bags of seed cost $380,” says Pottinger. “GPS tech saves us money.”

Oldham is more tech-ambivalent. While she won’t go as far as writing everything down with pencil like her dad, “I still like to steer the tractor, and cow tech apps aren’t working as well as I would want them.”

4. Networking is absolutely critical, stresses Ingrao. “Find somebody who knows how it works, to bounce farming ideas off of.  After you’ve been in Afghanistan or Iraq, sitting in a classroom isn’t something you really want to do.”

5. Know for certain what you want to get involved in, adds Oldham. Then go talk to those who are doing it. “You have to stay positive and pursue routes to stay so.”

6. Is land ownership important? “That really depends on your family,” claims Pottinger.

“We own 1,500 acres, and control about 15,000,” elaborates Tiffany. “Our industry is relationship-based. Take care of what you’re entrusted with, and it’ll work and grow.”

“Owning all of your operation is expensive,” points out Oldham. “The bigger question is: Can you afford it?”

TAGS: Soybean
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