But the overwhelming concern voiced by bankers is water. Not enough rain, and not enough water for irrigation. State-wide declining or soft prices are affecting grain, cattle, dairy and timber, among other industries. And the boll weevil infestation continues to plague the cotton farmers. More choices, more decisions, more complications is the way of life for today's farmer.
Many farmers generate only a part-time income from farming.
A growing percentage of farmers are getting their primary income from outside sources, with one or more in the household having outside employment. Some farmers are deciding to go out of business on their own, which is a different phenomenon from the past, where lenders were forcing the issue. Farmers are finding themselves owning equipment that is no longer needed because the farmer is planting different crops than he has in the past. AG lenders have particular issues to factor into their strategic plans, which some other lenders do not. Realistic and sound strategic planning can make the difference between a problem loan portfolio and a sound one.