A healthy farm industry is leading a regional financial company to add 84 employees this year, on top of 110 hired last year.
The hiring reflects growth in crop insurance sales, loans for farm equipment and other expansion by Farm Credit Services of America, a cooperative headquartered in Omaha and owned by 60,000 farmers and ranchers in Iowa, Nebraska, South Dakota and Wyoming.
Doug Stark, president and CEO, told about 100 people at a breakfast meeting Thursday that the cooperative’s focus on agriculture has brought strong growth in recent years as demand for food and grain-based fuel in the United States and abroad has prompted high prices for farm products and farmland.
Prices paid for Nebraska and Iowa farmland have risen more than 13 percent in just the last six months and tripled in the past decade, he told the meeting of the Association for Corporate Growth at Happy Hollow Country Club.
But Stark said everyone in agriculture knows that the business is cyclical and that a downturn will happen sometime. “You be the judge,” he said, when someone in the audience asked whether prices for land, crops and other key elements will turn downward. After a decade of growth, he said, “We’re really at a pivotal point.”
Even trouble on the Korean peninsula could affect Midwestern agriculture, he said. If North Korea “does something,” China might react politically, and China is a major agricultural trading partner with Midwestern states.
Stark said the Farm Credit System, made up of 84 local and regional cooperatives, is committed by federal law to agriculture and related financing, whether the industry is growing or in financial trouble. He said he has heard of farmland prices in northwestern Iowa close to $22,000 an acre, a sign that buyers believe demand for farm products will continue growing long-term.
It’s possible that land prices could collapse, but Stark said most buyers are borrowing less than half of the purchase price, so even a significant drop in land prices would not put them in financial jeopardy.
This week’s wet, snowy weather in the Midwest is rescuing farmers and ranchers from a repeat of last year’s drought, Stark said. “We love it. Our members are absolutely ecstatic about the moisture.”
Spring planting might be delayed a bit, he said, but today’s farmers have the equipment to plant 80 percent of the U.S. corn crop within a week, once the land dries.
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