Tag Archive for: Agriculture

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Calculator and hundred dollar bills sitting on pile of wheat grain
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From The Fields: Changing the Mentality of Strategic Planning

By Ben Hertel

As the calendar has now flipped to 2026 and we all inevitably take an extra second to think about what date we’re writing on a document, it shows again how habitual a simple task becomes. Habits, by nature, are tough to break. For many, it is easy to fall back into familiar habits, after all, it is what led us to our current point in life or business.

This leads us to ask how we can help our customers break those habits and become more organized. This applies not only to their finances, but also to timely reporting that allows them to utilize those records and reports to learn from the past to apply insights to future strategic planning.

Too many farmers and business owners alike view financial record keeping as a task completed solely to pay Uncle Sam or because their banker requires it, rather than as a tool to stay ahead in their business and plan for the future. Those who are not up to date often become habitual extension filers, producing documentation that is eight to ten months outdated by the time it is filed. By the time returns are produced, the current year’s crop is already in the ground and in some cases, nearly ready for harvest, making the financials largely unusable for planning purposes.

Let’s break this process down into three steps that can help our producers break this cycle.

Step 1: Formalize the Process

  • Resources are crucial and can make this process much easier, not just for us as bankers, but for the customers themselves. Creating a plan to organize all required information into, at a minimum, an Excel spreadsheet or another record keeping platform that suits them the best is a strong first step. Not every customer has a robust system but moving from handwritten records to an Excel sheet can make a significant difference in organization.
  • It is important to recognize that record keeping is not always simple or straightforward. Many producers are balancing long workdays, weather uncertainty, labor constraints and volatile markets, all while trying to keep operations moving forward. When record keeping falls behind, it is often due to time limitations. By acknowledging these challenges, we can better position ourselves as partners in the process. Offering practical solutions, manageable timelines, and realistic expectations can help reduce the burden and make consistent record keeping more achievable.

Step 2: Update Financials in a Timely Manner

  • Procrastination is not our friend and creating a plan to keep financials current on an ongoing basis is essential. Interim financials are important to help with planning priorities for the upcoming year. Encouraging growers to take advantage of available time before cropping season begins is key.

Step 3: Use Financials for Strategic Planning

  • Use the information you have to plan for your future. This includes pushing for accrual adjustments, calculating break-even points and learning from the past to gain efficiencies. While there will always be unpredictable events and circumstances, past performance can still help inform future decisions.
  • As bankers, we can add value when provided with current financials, demonstrating to our customers that we are partners in their future successes. We all want to be there to celebrate our customers’ wins, and successful planning can make that happen.

Breaking a habit does not happen overnight, it takes time, patience and persistence. The goal is to help customers focus on the reward of successful planning while creating an environment where we can work together effectively.

Start the conversation, break the habit, and help ensure success for generations to come.

Hertel is vice president – commercial/ag banking officer at Prevail Bank in Marshfield. Hertel also currently serves on the WBA Agricultural Bankers Section Board of Directors.

 

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From The Fields: Supporting WI Agriculture – A Resource Reminder

By Amy Austin

As we close 2025 and begin to discuss 2026 plans with farmers, it can be a stressful time as they review their financials and plan for the year to come, especially with depressed commodity prices. Agriculture bankers, milk truck drivers, technicians and countless others that are involved in day-to-day farm operations are often times the first to know about major life or farm altering events – good and bad. It is important that all of us are aware of signs of severe stress and know how to connect farmers with helpful resources. I urge you to listen carefully to those who may be struggling and help them reach out for a little extra support when needed.

I want to remind all agriculture bankers and others within the agricultural industry of the resources available through the Wisconsin Farm Center, part of the Department of Agriculture, Trade and Consumer Protection. From financial consulting, succession planning, and mediation services to their Farmer Wellness Program, the Wisconsin Farm Center is a trusted partner for the farmers we work with every day.

The Farmer Wellness Program offers:

  • 24/7 Helpline – Always available when someone needs a listening ear
  • Counseling vouchers – Assisting to cover the cost of in-person counseling services
  • Tele-health services – Support by phone or video
  • Online support groups – Connecting farmers with others around the state who understand
  • Rural Realties Podcast – Conversations on farm legacy, farm business & mental well-being

All of these offerings are free and confidential to Wisconsin farmers and their extended families.

I encourage you to visit the Wisconsin Farm Center’s website or reach out to their team directly to learn more about the resources available through their Farmer Wellness Program. One-on-one training is available as well. Our Ag Team at Lake Ridge Bank was fortunate to receive training with Karen Endres, the Farmer Wellness Program Coordinator, and Dan Bauer, the Wisconsin Farm Center Program Supervisor.

If a farmer you know is experiencing anxiety, depression, or simply needs someone to talk to, please encourage them to call the 24/7 Wisconsin Farmer Wellness Helpline at (888) 901-2558 for free, confidential, and immediate support any day, any time.

Austin is an ag & business portfolio specialist at Lake Ridge Bank in Evansville, and a current member of the WBA Agricultural Bankers Section Board.

 

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From the Fields: A Recap of the ABA National Ag Conference

By Nicholas Felder

The ABA Ag Banker’s Conference was held in St. Louis at the St. Louis Union Station Hotel. An architectural marvel and historical landmark that provided the setting for two and a half days of data, Q&A, humor, and personal struggles and success.

The consensus of economists from Moody’s, Dr. David Kohl, Center for Farm Financial Management, and members of academia like Dr. Andrew Griffith of the University of Tennessee was very similar: certain markets are enjoying their heyday (proteins) due to increasing domestic and global demand as a result of economic growth or health trends. And, gosh darn it, people like the flavor of U.S. grown chicken and beef! On the other hand, cash crops have been negatively impacted the entire marketing year by overhyped yield projections, trade disagreements, and domestic use concerns with the repeal of biofuels incentives.

Our protein growers and milk producers rely on domestic and close markets like Mexico to which we must be mindful of shifts in consumer demand (processing that reduces meal prep is preferred and shifts to protein-heavy diets). Overall, we may have fewer head of dairy, beef, swine, or poultry in this country that in the past as has been promoted by media for the last while, but the American Farmer continues to pound out larger, more productive animals resulting in strong volume production meeting the needs of consumers.

Liquidity retention through cost containment, family living boundaries, and effective tax strategies (not shiny paint for paint’s sake) remains the dividing line from the clear winners and losers. It was not size that determined profitability, it appeared to be cost reductions through the effective delivery of liquidity into the cash cycle. We always knew, but the data looks to be proving it out.

The loudest and most resonating topic for the week for me was the focus on the self: Culture, Training, Balance High Tech vs High Touch, Self Care through physical and mental choices, and beyond. When Dr. Kohl starts to discuss leadership, personal wealth, and the focus on personal growth – we should listen. Take NOTES via writing not a keyboard! Engages more areas of the brain! Read! Give back to your communities. All of which create communities in which we want to live, work, and play.

The ABA Ag Banker’s Conference reinforced its role as a vital forum for navigating complexity in ag lending. By blending economics, policy, technology, and personal anecdotes, the event helps attendees sharpen their strategies for their producers, be encouraged or moved to engage in meaningful advocacy, and build relationships that will support their institutions – and the producers they serve – through an unpredictable future. Participate! Advocate! Celebrate! Hope to see many of you in 2026 at the WBA Agricultural Bankers Conference, April 16-17 in Wisconsin Dells!

Felder is vice president – commercial and agricultural banking at MidWestOne Bank in Lancaster. Felder also serves as Chair on the 2025–2026 WBA Agricultural Bankers Section Board of Directors.

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Man sitting on wheel of large farming vehicle looking at laptop

From The Fields: Preparing for Q4 – More Than Just Harvest

By Matthew Hartmann

In my first few years of ag banking, I found the fourth quarter to be an intimidating time of year. As fall approaches, the focus of our clients and prospects typically shifts to getting crops out of the ground. As we all know, harvest is demanding, and time is limited. Have you ever found yourself trying to understand how to continue to add value to your clients and prospects without adding pressure during an already busy time?

I’ve been blessed to have some wonderful mentors in my life that have challenged me to find solutions to problems (both inherited and self-inflicted), while providing their unique perspectives during the process. As a result, I’ve come to find that this job doesn’t stop at understanding your client’s financial metrics. It’s about understanding the challenges (and opportunities) producers are facing and providing your perspective on possible solutions. It’s about building trust and showing them that you have a vested interest in their success.

I now view the fourth quarter as an opportunity to begin the next fiscal year strong. Harvest continues to be a key focus, as it should. However, thoughtful, well-timed conversations both during harvest and post-harvest can help avoid last-minute decisions later. Whether it’s exploring capital investments, reviewing succession plans, or running a few “what-if” scenarios based on current market conditions, starting early can provide room to think clearly and plan intentionally.

So as harvest continues, consider carving out time to ask a few thoughtful questions. Not every conversation needs to be formal or complex. Sometimes, simply being present and asking, “What’s on your mind as you look toward year-end?” can open the door to valuable insights, stronger relationships and trust that extends beyond the next loan renewal.

 

 

Hartmann is vice president – agricultural banking at BMO Bank, N.A. in Menomonee Falls. Hartmann also currently serves on the WBA Agricultural Bankers Section Board of Directors.

 

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Classic Red Barn in a Corn Field

From The Fields: Navigating the Future of Wisconsin Agriculture – Resilience. Risk. Opportunity.

By Lance Lansing

Wisconsin agriculture continues to be a cornerstone of the state’s economy and identity, with dairy, grain, livestock, and specialty crops all contributing to a vibrant, diverse industry. As agricultural lenders, our role extends beyond traditional banking—we are risk managers, strategic advisors, and partners in growth. In today’s climate, that role is more critical than ever.

Economic Headwinds and Financial Stress

Inflationary pressures, higher interest rates, and volatile commodity prices are reshaping the financial outlook for Wisconsin farmers. While some have benefited from strong milk and grain prices in recent years, rising input costs—particularly fuel, fertilizer, and feed—have cut into margins. The net result is greater financial stress on operations with tight working capital and high leverage.

As lenders, we must balance risk with long-term relationships. Tools like cash flow projections, margin analysis, and stress testing remain vital, particularly when evaluating renewals or new lending opportunities in sectors such as grain, where volatility remains high.

Climate and Conservation: A Growing Focus

Weather extremes—from drought in northern counties to excessive rainfall in southern regions—underscore the need for climate resilience. Many Wisconsin farmers are adopting conservation practices, such as cover cropping, no-till planting, and managed grazing, to build soil health and mitigate environmental risk.

These efforts present unique lending opportunities. Lenders can play a proactive role by supporting farmers through USDA conservation programs or by exploring green financing models that reward sustainability practices with lower borrowing costs.

Generational Transition: Planning Ahead

An estimated 60% of Wisconsin’s farms are expected to change hands in the next 10–15 years. However, fewer than half have a formal succession plan. This generational transition presents both a challenge and a chance for agricultural bankers to add value. We can support clients with planning services, facilitate land transfer strategies, and provide the capital needed for younger generations to step into ownership.

It’s also critical that we build strong relationships with the next generation of producers—offering financial literacy, tech-savvy lending platforms, and flexible loan products that align with the evolving priorities of younger farm operators.

Technology and Innovation in Lending

Precision agriculture, robotics, and data analytics are transforming farm management. These technologies can improve efficiency and profitability—but they also require capital. Banks that understand the ROI of ag tech investments can offer more targeted financing solutions, such as equipment loans, leasing programs, or partnerships with tech providers.

Additionally, digital lending platforms are streamlining loan applications and approvals, particularly for smaller operations and rural customers. Embracing innovation in lending processes will be key to staying competitive and responsive in this fast-changing environment.

Conclusion

Wisconsin’s agricultural landscape is evolving, and so too must our approach to agricultural banking. By deepening our understanding of the challenges our clients face—and proactively offering strategic, customized solutions—we can continue to be trusted partners in Wisconsin’s agricultural success.

Lansing is vice president – lending at Apple River State Bank in Darlington. Lansing also currently serves as the Vice Chair of the WBA Agricultural Bankers Section Board of Directors.

 

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A New Tax Advantage for Banks: 25% Interest Exclusion Explained

Wisconsin’s community banks have long been a cornerstone of the state’s rural and agricultural economy. A new federal tax provision introduced under the One Big Beautiful Bill Act (H.R.1) signed into law on July 4, 2025, offers an opportunity for financial institutions engaged in rural and agricultural lending to strengthen that impact. Section 139L of the Internal Revenue Code allows qualified lenders to exclude 25% of interest income earned on eligible rural and agricultural real estate loans from federal taxable income. This measure is intended to promote increased lending activity in rural areas by providing a tax incentive to participating institutions.

Eligibility Criteria for Lenders

The definition of a “qualified lender” is intentionally broad, ensuring a wide range of financial institutions can benefit from the new tax exclusion. Eligible entities include FDIC-insured banks and savings associations, state- or federally regulated insurance companies, U.S.-based subsidiaries of bank or insurance holding companies, and certain federally chartered institutions within the Farm Credit System. This inclusive approach is particularly advantageous for Wisconsin-based lenders, many of whom already serve rural and agricultural markets and are well-positioned to take advantage of this incentive.

Loan Qualifications

To qualify for the 25% interest exclusion, a loan must be secured by real estate classified as rural or agricultural, issued by a qualified lender to a U.S. customer, and originated after July 4, 2025. The exclusion applies to interest earned during tax years ending after July 4, 2025. While the borrower does not need to be a farmer or operate an agricultural business, the collateral must meet the rural or agricultural criteria.

Specifically, “rural or agricultural real estate” includes (i) any real property substantially used for the production of one or more agricultural products, (ii) any real property substantially used in the trade or business of fishing or seafood processing, and (iii) any aquaculture facility. These definitions ensure the exclusion targets loans supporting core agricultural and rural economic activities.

It is important to note that refinanced loans are not eligible for the exclusion under the current guidelines.

Interest Expense Limitations

Section 139L modifies the application of Section 265 of the Internal Revenue Code, which traditionally disallows deductions for expenses related to tax-exempt income. Under this provision, lenders are prohibited from deducting expenses associated with the portion of interest income that is excluded from taxable income. The expense disallowance is calculated based on 25% of the tax-exempt loan’s adjusted basis.

State Tax Conformity

Wisconsin already provides a state-level exemption for certain commercial and agricultural loan income; that exemption remains unchanged by the new federal Section 139L provision. Although both aim to encourage lending in key sectors, they operate independently. Wisconsin does not automatically conform to federal tax law, and its treatment of loan income will stay the same unless the state legislature takes specific action to adopt the new federal provision. Financial institutions should continue to track and report federal and state tax benefits separately.

Implications for Financial Reporting

It is equally important to consider how these changes affect financial reporting. The exclusion of a portion of interest income under this provision introduces specific considerations for both C corporations and S corporations.

  • C Corporations

For C corporations, the 25% interest exclusion reduces taxable income, thereby lowering the current tax expense reported on the income statement through the tax provision calculation. Because this exclusion represents a permanent book-to-tax difference rather than a temporary timing difference, it does not give rise to a deferred tax liability.

  • S Corporations

For S corporations that are treated as pass-through entities, the exclusion reduces the taxable income reported on shareholders’ Schedule K-1s. The deduction may influence the calculation of distributable income and affect shareholder basis.

Strategic Considerations

Financial institutions are encouraged to review their loan portfolios and origination strategies to identify opportunities to benefit from the Section 139L interest exclusion. Given Wisconsin’s strong agricultural presence and extensive rural lending activity, this provision may offer both tax savings and strategic advantages. Institutions should consult with their trusted tax advisors to explore planning opportunities and accurate financial reporting.

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Tractor planting a potato crop
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From The Fields: Gratitude in a World of Volatility

By Amy Austin

I recently read The Four Winds by Kristin Hannah, it takes place in the 1930s focusing on life in the Great Plains. The story follows a farm family from Texas that experienced years of bountiful wheat harvests followed by years of severe drought. Due to the lack of conservation practices and moisture the man-made disaster of The Great Dust Bowl was created. After several years of extreme hardship, the family chose to leave their farm behind and travel to California with very little to their name. Once arrived in the San Joaquin Valley, the family expected the land of milk and honey. That was far from the truth, due to the flood of migrants from the Great Plains – there was no work for these Americans as they were viewed as dirty, untrustworthy and criminal by the locals.

Today, there are many uncertainties in the world and in agriculture. This book was a reminder to me that there has always been obstacles that must be overcome no matter where one lives. Generations later, the worries of the farmers we work with aren’t that much different than they were then. Things like funding for government programs, interest rates, looming droughts, immigration, tariffs, providing for their families have always been on farmers’ minds.

I found gratitude in this book. As agriculture lenders, many of the farmers we work with look to us as a resource to be able to answer what will happen to the tariffs and all other issues in the news. Although we are still experiencing the same challenges that our ancestors have for decades, agriculture is better prepared for the fight today than ever before. We learned conservation practices to prevent hundreds of thousands of acres from eroding. Biotechnology has advanced so far that even in a drought year, corn yields remain average. Farm management decisions are now made with information from varying tools and resources. Farmers have social networks across the nation and internationally that connect them with others experiencing similar things.

This is a reminder for all of us and our farmers that we work with that there may be volatility and obstacles in the year to come, but there is proof that so much has already been overcome to be where we are today. We have much to be grateful for.

 

Austin is an ag & business relationship manager at Lake Ridge Bank in Evansville.

 

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Family with hands cupped together holding up patch of soil with plant growing out of it

From The Fields: Reflecting Back on 2024

By Craig Rogan

The 2024 planting season in several areas of Wisconsin will be memorable for the spring rains that limited planting and hay harvest windows. Farms in these areas focused on obtaining enough tonnage for cattle feed through several different methods. Working with their nutritionist and agronomist to calculate the number of acres necessary to be planted for corn silage was a vital process. These meetings allowed for operations to calculate the number of acres they would need to harvest for the necessary tonnage of feed for there cattle. Knowing your carry over inventory and daily usage is important to these calculations. In many cases the farms knew they would end up needed to purchase dry corn then raising their own dry corn or HM corn. Others planted what they could and took prevented plant on several acres while working out contracts with local grain farms to obtain corn silage.  The versatility of farmers is amazing on how they navigate through uncontrolled circumstances to feed their cattle.

A steady increase in milk throughout the year 2024 eased some of the stress that was being added to our dairy farmers from a cash flow standpoint. The decrease in crop inventories will have negative effect earnings when reviewing 2024 financials.

November is one of my favorite times of the year and most notable during the Wisconsin deer hunt, but more importantly the comradery that a deer camp provides. The gathering of hunters to tell stories of previous hunts, discuss current time and the future of the hunting camp. Now is the time to get together with your farmers and discuss history on the farm, current operation and what it entails for 2025 and the future of their operation.

Wishing you all the best as we near the start of 2025!

 

Rogan is vice president – agricultural banking officer at Nicolet National Bank in Stevens Point. Rogan also currently serves as the Immediate Past Chair of the WBA Agricultural Bankers Section Board of Directors.

 

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2024 ABA Agricultural Bankers Conference attendees watching presentation

From The Fields: A Recap of the 2024 ABA National Ag Conference

By Matthew Hartmann

The 2024 ABA Agricultural Bankers Conference took place at the newly renovated Baird Center in Milwaukee from November 12th to 15th. With the recent election and ongoing challenges in the agricultural industry, there was a great deal for attendees to discuss.

ABA’s Chris Fisher, Ed Elfmann, Blake Earley, and Kirsten Sutton

Members of the ABA’s congressional relations team, Blake Earley, Chris Fisher, and Kirsten Sutton joined ABA’s SVP of Agricultural & Rural Banking, Ed Elfmann, to discuss the impact of the recent election results on banking policy. They noted that the GOP’s control of both the House and Senate could benefit bank-friendly policies. The panel emphasized their role in making every banking priority as bipartisan as possible and discussed the need for strategic advocacy to ensure banking priorities are considered, regardless of which party holds power, as control could flip in two years. Regarding the new Farm Bill, Elfmann noted that there is a slim chance of a vote being included in the lame duck session. He suggested that another extension is more likely to give the Senate time to work on a five-year bill, as the House already has its version, and he doesn’t anticipate much change there. He also provided an update regarding the Access to Credit for our Rural Economy (ACRE) Act, explaining that it will likely be included in tax legislation outside of the lame duck sessions and that including it in tax reform is the best vehicle to move it forward. He mentioned that significant progress has been made, with more Democrats supporting the plan than ever before. However, with Sen. Jon Tester losing his seat in Montana, they might need a new supporter from the minority party in Congress. Elfmann stressed the importance of advocating to key Senate members to support this plan and making sure farmers understand how it will help them. ACRE would enable access to more affordable real estate credit for farmers, ranchers, and rural families by granting banks that serve rural communities the same tax-exempt status on certain earned interest as the farm credit system, allowing banks to offer lower interest rates to farm real estate borrowers and rural homeowners.

The pre-conference workshop, “Buckle Up. Turbulence Ahead.,” set the tone for the conference by highlighting some challenges producers will face in the coming year. Net farm income is projected to decline for the second consecutive year due to continued pressure on prices and higher interest rates. Equipment prices are softening, and in some areas of the country, real estate values have begun to plateau. Reviewing asset valuations with clients to prevent overleveraging and preserve working capital will be crucial. With average interest rates above 8% for the first time in nearly two decades, moving debt down the balance sheet to replenish working capital may be more challenging than it was between 2014 and 2019 when the yield curve was flat. Dr. Kevin Bernhardt’s (Professor, UW-Platteville School of Agriculture) presentation, “Impact of Rising Interest Rates,” was a valuable supplement, reiterating the impact of increased borrowing costs, decreased net farm income, and a slowdown in farmland value growth.

Dr. Kevin Bernhardt

He noted that 35% of agricultural bankers report tightening credit conditions and a rise in Chapter 12 bankruptcies. Lenders anticipate ongoing cash flow challenges resulting in delayed capital expenditures and increased demand for refinancing, while emphasizing the need for greater efficiency and risk management. Bernhardt recommends strategic financial planning, including budgeting for capital expenditures with interest rate contingencies, stress-testing leverage multipliers, and cautious debt restructuring to avoid deadweight debt.

With challenges ahead, there was an emphasis on the importance of building strong business relationships and focusing on cash flow management to help clients navigate these times. In his presentation, “Better Communication, Stronger Relationships,” Vernon Roberts (Executive Coach, Extraordinary Communications) highlighted the importance of enhancing communication skills to build stronger relationships. He emphasized that strong relationships are built on the ability to ask thoughtful questions and answer challenging ones. He noted that empathetic communication and strategic questioning are crucial for fostering better relationships and effectively handling challenges. Scott Sartor’s (Founder/CEO, Croptell) “The Hero Ag Lender: Modern Cash Flow Education” and Anthony “Tony” Hotchkiss’s (Retired Ag Banking Executive) “Farm Financials: What Bankers Need Their Producers to Know” both stressed the importance of strong partnerships between bankers and producers, while underscoring the critical role of proper financial management. Sartor focused on leveraging technology and data to assist in the vital role that loan officers play in guiding farmers through financial challenges and supporting sustainable operations. Hotchkiss highlighted the importance of understanding farm financials, including key financial statements, cost of production, and the impact of capital expenditures, to ensure financial stability and growth.

In their presentation “Swift Signs in Agriculture,” Jessica Lehman (Managing Director, First Financial Bank) and Zach Allen (Senior Director, First Financial Bank) drew parallels between Taylor Swift song lyrics and stressed credit scenarios to highlight the importance of identifying red flags in character, financials, loan covenants, and agricultural cyclicality to manage troubled assets and limit bank risk. Jennifer Lurken (Partner, Gislason & Hunter, LLP) and Michael Dove’s (Gislason & Hunter, LLP) presentation, “Identifying and Protecting Against Hidden Liens and Lenders,” discussed understanding and managing various agricultural liens to protect financial interests and ensure priority in the event of debtor default or liquidation. Both presentations provided practical advice for agricultural bankers to mitigate risks and manage their portfolios effectively.

Organizational culture was also a key topic, highlighting its significance in shaping workplace environments and overall success. In “Building & Sustaining Strong Cultures in Banking,” Nate Franzen (President, Ag Banking, First Dakota National Bank), Lynn Paulson (SVP, Agribusiness Development, Bell Bank), and Alan Hoskins (President and National Sales Director, American Farm Mortgage and Financial Services) discussed the need for organizations to adapt to new challenges, understand cultural influences, address toxic elements, and maintain core values. Casey Merkwan’s (Community Market & Engagement Manager, Old National Bank) presentation, “Merging Bank Cultures for a Seamless Transition,” underscored the importance of understanding cultural differences, promoting transparency, and the role of leadership in ensuring effective communication and strong leadership during mergers.

This year’s keynote speakers brought a diverse array of experiences and insights, captivating the audience with their unique perspectives. In his 47th conference appearance, Dr. David Kohl, as

Dr. David Kohl

always, was able to keep the room engaged while discussing an agricultural industry outlook reminiscent of the 2013-2020 down cycle. Natalie Bartholomew, a seasoned banker and community president, is known for her advocacy for women in banking through her platform, The Girl Banker. John Wesley Boyd, Jr., a fourth-generation farmer and civil rights activist, founded the National Black Farmers Association. He shared his experiences working extensively with national and international leaders to fight the discrimination many black farmers have and continue to face. Craig Culver, co-founder of the Culver’s restaurant chain, shared his journey from a family-owned restaurant to a successful franchise with nearly 1000 locations. Retired Rear Admiral Scott Moore, with 30 years of experience as a SEAL leader, offered insights into leadership and tactical planning from his time leading elite military forces, which includes leading a mission later portrayed in the Tom Hanks film, Captain Phillips. Together, these speakers provided great knowledge and inspiration with their diverse leadership perspectives, and I strongly encourage readers to spend time learning more about each of their journeys.

I want to extend a sincere thank you to all our sponsors, exhibitors, and bankers from across North America (including our Canadian friends) who attended. I hope to see you all again next November at the 2025 ABA Agricultural Bankers Conference in St. Louis, MO. As always, it was wonderful to connect with our fellow Wisconsin bankers and I encourage all bankers interested in agriculture and agricultural banking to join us at the 2025 WBA Agricultural Bankers Conference, taking place on April 10-11, 2025 at the Kalahari Resort & Convention Center in Wisconsin Dells.

 

Hartmann is vice president – agricultural banking at BMO Bank, N.A. in Menomonee Falls. Hartmann also currently serves on the WBA Agricultural Bankers Section Board of Directors.

 

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Green combine in corn field during harvest

From The Fields: Grain Harvest 2024

By Lance Lansing

As is done every year in September, planted and harvested acreage estimates for corn, cotton, and soybeans are reviewed based on all available data, including the latest certified acreage data from the Farm Service Agency. The USDA’s Supply/Demand Report on 9/12/2024, reported the outlook for harvest yields as “good” for our part of the country. USDA is estimating record yields in both corn and beans for southern Wisconsin and that will lead to even bigger increases in supply so we should expect to see lower prices for 2025. According to USDA data, production for corn increased by 39 million bushels to 15.186 billion. That is 30 million bushels above expectations. Record yields are projected at 183.6 bushels per acre vs. 183.1 bushels per acre predicted last month. Old Stocks are below expectations at 1.812 billion due to stronger exports and increased ethanol production. New stocks came in above expectations at 2.057 billion.

Bean production was trimmed by 3 million bushels to 4.586 billion which was 23 million below expectations. Record yields were left unchanged at 53.2 bushels per acre. Old stocks were cut 5 million bushels to 340 million in line with estimates. New crop stocks cut 10 million bushels to 550 million which is 34 million below expectation. Ending stocks were left unchanged at 828 million bushels.

As a result of the elevated yield expectations, working capital will probably be negative for most grain farmers in 2024. That could lead to increases in short-term operating loans. That could also mean a sharp decline in machinery purchases and capital improvements.

According to a recent survey done by Illinois FBFM, the cost of production for corn on owned ground hovered around $600/acre from 2015 to 2021 but has since jumped to $800/acre plus. When adding in cash rent that number increased to an all-time high of $1,182/acre in 2023. Projections are for only a slight reduction to input prices in 2025, leaving little room for the farmer to offset lower market prices. Improvements to input prices may come from anhydrous and nitrogen prices but Dap and Potash will likely remain steady. Diesel prices will be affected by who sits in office but has been trending lower. Cash rents should drop but landowners are going to be reluctant to follow through, especially those who owe money and are paying higher interest rates. The expected difference is only $25/acre.   Net income per acre hit a record high of $500/acre in 2022 and is estimated to be near zero or below for 2024 and 2025.

As bankers, we need to recognize that our grain producers are in a downward trend after 2-3 years of profitability. We can build value in our relationships by reminding our grain clients to get back to the basics. Make sure they know their cost of production. Encourage them to spend time on their financial statements and reporting. Control costs including inputs, land rents, capital purchases and family living. Debt per tillable acre has increased from $267 in 1992 to $809 today, and it is expected to continue to increase with the cost of land. Debt to asset ratios have dropped from 32% to 17% over the same time signifying that most of our landowners are 60 years old and older. This means that farm succession planning is more important than ever for our producers.

This is a time that our grain producers will need the support of their bankers. It will be our job to make sure they have the tools and knowledge needed to weather this downturn in profit. More communication will be needed to get through this to a more profitable time. We can bring value to the relationship with honest analysis, and hopefully the profitable times will return sooner rather than later.

Lansing is vice president – lending at Apple River State Bank in Darlington. Lansing also currently serves on the WBA Agricultural Bankers Section Board of Directors.

 

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