Grain producers should consider cutting costs to prepare for what could be several years of lower crop prices, Purdue University agricultural economists said.
“The message right now is to maintain your liquidity and protect your working capital,” said Michael Boehlje, a specialist in agricultural finance. “That means holding onto your savings and keeping a very close eye on your bottom line.”
A good first step, he said, would be to restructure any outstanding debt.
“If you have short-term loans, leases or purchase agreements, talk to your lender and see if you can extend the term to reduce your monthly payments,” he said. “Many lenders have become risk-averse in this environment and might not be willing to refinance, but it would be a good idea to look into the possibility as soon as possible.”
Chris Hurt, a marketing specialist, said there were plenty of other ways for farmers to tighten their belts, including streamlining their operations to become more efficient and avoiding any unnecessary purchases.… Continue readingRead More »