"Financing Farm Operations: The Importance of Credit and Risk Management"
House Subcommittee on General Farm Commodities, Risk Management, and Credit
2025-07-16
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Source: Congress.gov
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Maybe will come to order welcome and thank you for joining today's hearing entitled financing for operations, the importance of credit and risk management. After brief opening remarks members will receive testimony from witnesses today and then the hearing will be open to questions. In consultation with the ranking member pursuant rule 11 e I want to make members of the subcommittee where the other members of the full committee may join us today. And today we will hear from lenders representing diverse regions across the country, along with a producer, all of whom bring firsthand insight into the challenges farmers face when seeking the capital necessary for success. The reality is that farming is getting tougher every year. Input costs are up and market prices are down. If we don't support today's farmers, there won't be a next generation ready to step in. We must ensure the resources available to those who provide capital to our producers can meet the moment. This is why Farm Bill programs matter. They form the foundation of affordable, reliable credit for our producers. Lending tools and risk management programs like crop insurance and commodity programs work hand in hand to help farmers withstand downturns and sustain their operations. The loan programs to the safety net, it's critical that producers and their lenders have as many tools in the toolbox as possible to ensure dependable access to capital. It's essential to maintain the safest, most abundant food supply in the world. Over the past six years, we've seen nearly $130 billion in ad hoc assistance flow to producers, many of that in my district. Well, that support was necessary in times of crisis. It is no substitute for a durable, predictable safety net. We owe it to farmers and lenders alike to build a system that doesn't rely on ad hoc assistance every time a disaster strikes. And I might add, the ad hoc assistance in many cases takes well over a year to get to the producers. That's exactly what the one big beautiful bill does we string that the farm safety net increased reference prices expanded access to crop insurance and the opportunity to add additional base acres.
Just a few of the real improvements will bring more certainty to producers and reduce risk for lenders. additionally the bill significantly raises the federal estate tax exemptions and makes it permanent in the tax code allowing farmers more clarity to plan for their future we know work can our work cannot stop there today our loan programs don't reflect the realities of the modern family farm loan limits are outdated and the lending process is often slow and burdensome We must ensure that the credit programs at the Farm Service Agency are approved to serve both producers and lenders. That's why today's hearing is so important. The discussion today will help guide the next steps in our Farm Bill reauthorization process and ensure that the credit title complements the changes we made in the one big beautiful bill. It will also underscore the need to support our producers who take the risk to grow the food, fiber, and fuel our country depends on. I want to thank our witnesses for being here and for all of the work that you do every day. Your insight is critical to helping this committee get it right. With that, I'd like to welcome the distinguished ranking member, the gentlelady from Kansas, Ms. Davids, for any opening remarks she would like to give.
Thank you Chairman Scott for convening this important hearing. You know Kansas is home to more than fifty five thousand farms and agriculture remains the number one economic driver in our state. When I speak to Kansas producers one issue consistently rises to the top and that's the importance of the farm safety net. Since Congress last passed a full bipartisan farm bill in 2018 the landscape for producers has changed dramatically. Farmers and ranchers are facing high input costs, rising interest rates, supply chain disruptions, and market volatility driven by global uncertainty, including tariffs. These producers make programs like crop insurance and access to affordable credit, especially through USDA's credit programs, that much more critical. That's particularly true for beginning farmers and those in underserved communities who are trying to break into agriculture at a time when the average age of a Kansas producer is nearly 60 years old. Kansas producers have always been resilient, adapting to challenges that are immense, the Dust Bowl, droughts, climate change. But resilience is in the DNA of Kansans. But it does take partnership. And it's our job on this committee and in the Congress to be that partner to ensure that the risk management tools that farmers rely on are strong, that they're accessible, and that they're responsive to the needs of the folks making use of them. And I want to thank you. our panel today for being here, for sharing your insights and expertise. Your experiences are certainly critical to this committee, to our ability to ensure that federal agricultural policy works for all farmers, and that includes new ones, inexperienced, experienced farmers, large and small, and folks in every corner of our country.
So I look forward to hearing your testimony, and I appreciate the time. Thank you, Chairman, and I yield back.
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