The head of the fifth largest Farm Credit Association firm expects interest rates to remain low — at least for now. Paul DeBryin is president and CEO of AgStar Financial Services, based in Mankato, Minnesota.
“If you listen to the Federal Reserve and Ben Bernancke, it sounds like he’s going to continue to hold them down, probably for the next 18 months to two years. So, we probably won’t see sizeable increases for a while,” DeBryin tells Brownfield Ag News.
But, DeBryin cautions, with the economy beginning to pick up some – in the housing and consumer sectors for example –a period of inflation is coming.
“Once that happens,” he says, “Interest rates may start to rise pretty rapidly. We have a lot of clients that want to sleep at night, so, they’re fixing rates. You know, wanting to put them on longer maturities so that they don’t have to worry about trying to figure out when it is that rates might begin to increase.”
He cautions farmers to know their financial position and employ risk management tools. DeBryin says the global economy is a big market factor and no one knows how the ongoing volatility will impact prices. DeBryin says there are strange things going on in ag, “We’re cheering for South America to have a crop. We’re shipping corn UP the Mississippi. We’re shipping corn from North Dakota to Indiana. We’ve exported ethanol to Brazil.”
AgStar Financial provides loans and financial services to farmers, agribusinesses, and rural communities, specializing in swine, dairy, grain and ethanol industries.
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