Fortunately, it is now official.
As of yesterday, we have no relationship whatsoever with Farm Credit. Our line of credit, in place for many years, was up for renewal with no likelihood of it not being renewed. We had saved all of our yearling heifers (sold only half our calf crop) and wanted to either keep the heifers until they could be sold as bred heifers or, better yet, cull older cows as bred cows in the fall and keep the bred heifers. We were turned down for an increase in the line of credit that would have allowed us to keep our existing animals for another six months, with a likely increase in value of an additional 50K or more. Farm Credit also blocked our purchase of an additional 150 heifers to be sold as bred heifers in the fall because the lender who was willing to finance the additional purchase also wanted a UCC on the purchased animals.
The letter that I wrote in response to a pro forma rejections letter, calling the information therein to be equivalent to the southern emissions of a north facing bull, was not well received. The detailed rejection letter written to me on Farm Credit’s behalf apparently insulted my loan officer and his boss, neither of whom appear to have been overly constrained by logic or common sense. I was given a two week notice that the line of credit would not be renewed. The consequence of the non-renewal was that the only way we could obtain any further money for operating expenses would be to first pay off the entire balance to Farm Credit by selling either cow/calf pairs at their current lowest value or by the selling unbred heifers, also at their current lowest value. Neither of those choices made any economic sense. Selling cow/calf pairs would have resulted in decreases in animal numbers would have had a crippling impact on our operation. Assuming a modicum of intelligence on their part, Farm Credit was well aware of the potential impact. Apparently they considered their actions to be justifiable for reasons only they can explain. Inasmuch as I was on at least the fourth loan officer (others had all moved on), it is possible that the local organization is so concerned with job survival that it is much better to say “no” than it is to risk making any changes.
In what seems to be supreme irony, our agricultural loans are now all from a non-agricultural bank, one which does not enjoy the special tax privileges Farm Credit gets for making agricultural loans.
We apparently are not the only ones who have suffered the wrath of Farm Credit: http://reformfarmcredit.org/
***Gary A. Howie MSc, PhD*** is a business owner/rancher and a Life & Liberty News contributor
We have are ag loans threw united fcs in Wisconsin I believe this was farm credit at one time it has now turned into a sick joke. I told them this spring I needed to buy 20 springing holstein heifers (I milk cows) the loan officer called my home phone left me a message they just couldn’t borrow us anymore money at this time we never use this phone we just have it for Internet so it was a week before I got his message it’s like when the tuff times come they don’t want anything to do with you so here we sit we go more broke every day.