With four years of low commodity prices and no clear sign of a turnaround, University of Minnesota Extension services has started offering one-to-one financial counseling to farmers in financial stress at no cost.
The free service is offered in response to a sharp uptick in requests for Extension to offer financial consulting, according to Kevin Klair, who is an extension professor in the department of applied economics.
Klair said financial stress has increased rapidly since 2013, which marked the last year of high commodity prices. In the time since, input costs have decreased, but not nearly enough. These factors have led to farmers burning through their working capital and growing concern around getting refinanced.
“Farmers are beginning to wonder how long will this go, and how will they continue to manage it,” Klair said. “Good yields last year helped farmers out, but we won’t always have yields to pull us out.”
In response, Klair said Extension plans to hire 12 farm financial analysts that will span Minnesota, with the goal to make it easy for farmers statewide to meet in-person. Analysts will come from a farm lending or farm business education background and have decades of experience working with farmers.
Each analyst will work with farmers confidentially on a wide variety of ways to reduce financial stress. Tactics can vary from working with a lender to restructure or refinance to how a farmer can look at reducing input costs. Klair said each analyst will be prepared to take a comprehensive look at farm operations and the financials behind it as they search for ways to reduce financial stress.
Farmers who are interested should call the Extension Farm Information Line at 1-800-232-9077. Callers will only need to provide their name, county and major commodity produced to start the process of working with an analyst.
Klair emphasized this program is for farmers avoiding foreclosure. For farmers in foreclosure, it is recommended they reach out to the Farmer-Lender Mediation program.