Bankers and Small Farmers Find Common Ground - Growing Local Economies
Jeff Gangemi Feb 09, 2012 News 0 comments
According to a great feature story by Patty Cantrell on sustainableagriculture.net, there is a “growing group of activist lenders and small farm business advisers,” who are defying convention by supporting businesses - and sometimes business models - that look unproven and unfamiliar to more traditional lenders.
And they’re not in it for philanthropy. If more lenders don’t become versed on farms and farm lending, then the sector’s economic and production potential may remain unrealized. That’s bad for business and bad for banks.
Last year, a study conducted by the Opportunity Finance Network found at least as much need for capacity-building among lenders as there was among farmers, who are surprisingly competent at basic finance. This year, that group will offer training on farm production lending as part of a capacity building effort funded by the U.S. Treasury Department’s Healthy Food Financing Initiative.
With the next Farm Bill on the horizon, there may soon be more federal loan funds available for building small ag-based businesses. Read on for more about how farmers and bankers are working to make sure they are prepared to unlock the growing economic potential in local food and farms.
“Nic Welty employs himself full time year-round raising lettuce, spinach, and other leafy greens in three low-cost passive solar greenhouses, which together cover less than one acre of land.
His 9 Bean Rows farm near Traverse City, MI, is one of many smaller, diversified, often first-generation farms in the country that defy expectations, particularly among bankers and others with money needed to finance the new food enterprises.
Most find it difficult to pencil out the possibility that such a niche farm business could reliably make enough money to grow…”