High farming costs challenge FSA loans - WALB.com, Albany News, Weather, Sports

High farming costs challenge FSA loans

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August 29, 2007

Dawson -- Even in a good year, farmers can face financial challenges. Some farmers even have trouble getting the loans that they need.

With the worst drought in decades and high fuel prices, this hasn't been a good year for many farmers.

But if they can't get help at their bank, they may be able to get help from the federal government. However, the help the government provides, may not be enough.

Edward Parker is a local farmer who is applying for a Farm Service Agency farm ownership loan. He knows all to well the high costs of farming. "Your fuel prices, fertilizer prices, nitrogen prices, equipment; all that is through the roof," said Parker.

A farmer for more than 30 years, Parker and his wife lease more than 500 acres of farmland in Lee County where they operate E & I Diversified Farming Services.

"We produce peanuts, corn, and soybeans," says Parker.

But Parker's goal is to own his land. So today, he and other local farmers met in Dawson to get approval for an FSA loan.

He said, "To farm for the rest of our lives, we feel like we need to own the land to start a family farm. Today we're just trying to get the basics of what we're going to need to just continue."

For farmers who are unable to receive a commercial banking loan, FSA loans provide money for land, feed, seed, and equipment. But there is a $200,000 cap on the loans, which does not necessarily provide farmers enough funds to keep up with today's farming costs.

"You're talking about a direct, farm ownership loan of $200,000. You know, like I said, it's not even enough money to operate a farm professionally, like it needs to done," says Parker.

Few would argue with Parker. With tractor equipment alone reaching into the six figure digits, few loan alternatives are out there for farmers who cannot meet the high collaterals set by commercial banks.

Economic setbacks such as these are really placing the hurt on small farmers.

Parker admits, "Farming, I think, is the backbone of America. I mean, without it, where would we be?"

And while the low-interest FSA loans are considered a savior to farmers in need, rising industry costs now jeopardize its worth.

Farm ownership direct loans are offered to members of socially disadvantage groups. USDA farm loan representatives say they have been successful for past recipients.

FSA loans are offered to farmers and ranchers through the USDA. If you would like more information on the loans, contact your local Farm Service Agency office.

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