As the new Chairperson of your Agricultural Bankers Section of the WBA, I would like to take this opportunity to thank you for your membership and participation in the organization! I would also like to thank our two outgoing board members (Dave Coggins and John Zanghi) for their service and commitment to the Ag Section. During their tenure, membership numbers have increased and participation in the numerous offerings that the Ag Section of the WBA provides has also expanded. New to the Board this year are Matt Towns from DMB Bank in DeForest and Chris Schneider of Investors Community Bank of Manitowoc. On June 1, the new Board met to reorganize and plan for the upcoming year, and I think that we have some interesting opportunities for you to take advantage of. Please check your emails and this monthly newsletter for all of the upcoming opportunities.
As we near the half-way point of 2017, it's clear that our agricultural clients probably won't be setting any records for profitability. Most commodity prices remain stable but lower than average, with any small rallies quickly being offset by some report indicating further bearish news. In most cases, it comes down to an issue of supply and demand. Farmers are very good at producing food, and when conditions are right, they invariably produce more than what can be consumed or traded. For the dairy industry, the recent squabble with Canada over ultra-filtered milk has further complicated things, setting off a mini trade war with our neighbor to the north. In addition, an atmosphere of nationalism and protectionism appears to be prevalent between the US and our three leading trading partners (Mexico, Canada and China). To paraphrase Dr. Dave Kohl, historically when nationalism rises, agriculture is the first sector to pay the price. Let's hope that we resolve our differences with these countries soon, or the economic impact will be harmful to an already weakened economic area.
For agricultural bankers, the current economic climate has certainly created some challenges. Many of us have been through this before, and it is important to stay positive with our clients. Agriculture will be here in Wisconsin for decades to come, but it will look far different from where we are today. Change is inevitable, but it's how we react to that change that will determine our (and our customer's) success or failure. Most farmers look to their lenders for guidance during times of stress, so being a good source of unbiased, unemotional feedback can be the best help that we can provide.
Several Members of the 2017-2018 WBA Agricultural Bankers Section Board gathered at WBA in early June for orientation and their first meeting of the year.
Buttke is vice president, commercial and agricultural banking at Nicolet National Bank, Green Bay and the Chair of the 2017-2018 WBA Agricultural Bankers Section Board.