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Bankers have questions, concerns about hemp

Agricultural bankers still have some reservations about industrial hemp, even with hemp-friendly language in the 2018 Farm Bill.  Chief Operating Officer Mike Semmann with the Wisconsin Banker’s Association says, “Bankers are really telling us to tap the brake here a little bit.”

Semmann tells Brownfield they’re looking at the federal rules and the 2018 Farm Bill language, and also what Wisconsin has already done during its one-year-old hemp pilot program.  Semmann says bankers still have a lot of questions.  “They’re asking a lot of the detailed questions about the crop cost, the price structure, yield, returns.  They’re trying to figure out what is all involved in the contracts and the markets.”

The association surveyed bankers and found 87% will not actively promote loans to hemp farmers and processors, and 87% believe hemp will not provide enough revenue to stabilize a farmer’s revenue stream.

Semmann says bankers will be looking at collateral for loans, but also a farmer’s experience and understanding of the hemp market.  “They know their customers.  They will dive in on the details and they will be very responsive, so if you’ve got contracts, the more information that you can provide to your banker, the better off you’re going to be.”

Listen as Mike Semmann from the Wisconsin Bankers Association talks with Brownfield’s Larry Lee.