Pressures Continue to Grow in the Ag, Logistics Industries
As guest editor of this issue of the JCR , in early February I began formulating topics that focused on the challenges faced by the agriculture and transportation industries. Final submissions were due March 10. On March 11, the NBA abruptly suspended its season, Tom Hanks announced he had tested...
Will Chapter 12's New Debt Limit Fuel a Cramdown Express?
On August 23, 2019, President Trump signed into law the Family Farmer Relief Act of 2019, which increased the debt limit under Chapter 12 of the U.S. Bankruptcy Code to $10 million from about $4.15 million. This means that Chapter 12 is now a viable option for larger family farming operations,...
Squeezed by Constantly Evolving Supply and Demand
When people think of agriculture, they think of long-term businesses in steady markets. They think of family-owned businesses passing from generation to generation. They think of farmer-owned cooperatives serving their members and feeding the world. That has been changing in a dramatic manner over...
Working with Distressed Agricultural Cooperatives
Today’s volatile and uncertain economic environment is taking a toll on agricultural producers and cooperatives, creating both opportunity and challenges to the financial services organizations that support these vital businesses. Cooperatives, or co-ops, are privately held businesses owned and...
Thomas Jefferson recognized more than a century ago that “agriculture is our wisest pursuit, because it will in the end contribute most to real wealth, good morals and happiness.” Today, agriculture, food, and related industries contribute more than $1 trillion to U.S. GDP. They account for more...
The financing of a commercial farming operation presents unique issues for lenders, regardless of their status as secured, potentially secured, or unsecured. 1 Many of these issues are intrinsic to production agriculture. Others are the product of special legislation. Still others are attributable...
Many insolvency industry gray beards who live in states where agriculture is a major industry will remember the 1980s farm crisis. That’s when agriculture loan default rates exceeded 6 percent, many family farms were lost forever to foreclosure, Farm Aid Concerts were held to help financially...
Times were good for U.S. corn producers back in 2012, when prices stood at $7 a bushel. But since then, producers have watched as $7 fell to below $4, where prices have remained for nearly five years. Like corn, other farm commodities are also feeling the pain of depressed prices. Soybeans, wheat,...
Financial publications such as the Wall Street Journal have been running articles on rising distress among agricultural producers. Many turnaround professions, particularly those in the Midwest, have seen an uptick in the number of farm bankruptcies and foreclosures. While it does not appear this...