The Federal Open Market Committee will make another interest rate decision this week. Innovus Agra President Bret Oelke said the issue for farmers goes beyond the percentage rate increase. “We’ve pushed ahead enough income and we’ve prepaid for enough expenses that nobody is going broke this year.” To manage taxes, farmers may decide not to pay off their operating line of credit before the end of the year. “Now, all of a sudden, we’ve got an increasing volume of capital that we’ve needing and we’re probably paying twice what we were three years ago for operating line interest rates. That’s going to be the wakeup call.” In that scenario, Oelke said farmers will experience $40-to-$50 per acre interest costs for short and intermediate credit. Watch the entire seminar.
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