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Dairy financing is different this year
A lot of dairy producers are wondering just where they stand credit-wise this spring. Gary Sipiorski serves on the Advisory Council for Agriculture and Industry for the Federal Reserve Bank of Chicago, he says lenders do have money to lend but bank examiners are causing them to be tighter with credit. “When the documentation looks sketchy, that’s when lenders are going to have to pull back.” However, Sipiorski points out that if your banker can’t go with you, there are other sources. The Farm Service Agency has $300,000 in direct money available at a 2.6 percent rate for seven to ten years amortization also there are WHEDA crop loans available up to $100,000. Sipiorski says now is the time to talk to your lender.
Another new thing for dairy producers this year is lenders may ask for some type of milk marketing plan beyond “Having the milk truck back in and load up.”
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