Chad Hart, ISU Extension Grain Marketing Economist, highlights new Iowa State University Extension and Outreach videos for today’s current farm financial situation.
With commodity prices low and projected to stay that way over the next couple years, farmers have begun to feel the pinch in their pocketbooks. This has made managing the finances of the farm that much more important. With this in mind, Iowa State University Extension and Outreach has released two videos that deal with the current farm financial situation and what can be done to alleviate financial pressure.
I host the first video, titled Tips for Managing Margins. It offers ideas for how to weather the next few years of low crop prices like protecting capital, reviewing production costs and renegotiating loans.
The second video, called Understanding Farm Mediation, was created in partnership with Iowa Mediation Service and is about the process of mediation. Mediation is an option available to farmers as they work with their creditors to find a mutually beneficial solution to a delinquent secured agricultural debt of $20,000 or more.
This short video provides tips to help farmers better understand what mediation is and when it may be necessary. It describes the process and provides a step-by-step guide on how to prepare for mediation.
While mediation is available should it be needed, ISU Extension and Outreach also provides these financial resources to help farmers create a financial plan for their operation:
The Iowa Concern Hotline provides free legal information to both rural and urban Iowans. Services are available 24 hours a day, 7 days a week by calling 1-800-447-1985.
Mike Duffy, ISU Extension Economist, provides information on the Farm Financial Planning Program.
Farm Financial Planning is Iowa State University Extension’s farm financial analysis program. It consists of one-on-one confidential financial counseling, a computerized analysis of the farm business, and referral to other extension programs or outside services that may be useful.
What does it do?
Farm Financial Planning helps you evaluate your farm business and determine whether or not a change is desirable. It provides an in-depth plan for the farm business so the operator and the lender can make decisions for the future.
The computer analysis looks at profitability, liquidity, solvency, and risk-bearing ability. This information is provided for three or more alternative plans at a time. Examples of alternative plans could be the addition, expansion or phasing out of a livestock operation, or buying, selling or renting land. Farm Financial Planning can help evaluate ways to correct negative cash flow and profitability problems.
A trained extension associate meets with the family to discuss the results of the analysis and the possible effects if changes are made. The extension worker may introduce other farm and family financial materials or information about outside sources of help.
How much does it cost?
The service is currently available at no charge through a grant made possible by CF Industries.
How do I make an appointment?
To set up an appointment, contact the associate in your area. For more information, contact your ISU Extension county office or the Beginning Farmer Center at 1-877-232-1999.
Where would I go to find easy-to-use cash flow spreadsheets for my farm operation?
The Ag Decision Maker web site provides several options for cash flow spreadsheets, ranging from a simple projection to a detailed multiple crop option. Information Files are also available to provide assistance in understanding cash flow analysis. To see the options available, visit: http://www.extension.iastate.edu/agdm/decisionaidswd.html#f. The video below will guide you to the cash flow spreadsheets available on Ag Decision Maker.