WASHINGTON, D.C. – U.S. Senator Debbie Stabenow, Ranking Member of the U.S. Senate Committee on Agriculture, Nutrition and Forestry, today released the following opening statement – as prepared for delivery – at today’s hearing entitled: The Farm Credit System: Oversight and Outlook of the Current Economic Climate.
Stabenow’s statement, as prepared for delivery, follows.
Thank you, Mr. Chairman.
And thank you to our witnesses – as well as the leaders from the Farm Credit Administration, it is great to see all of you again.
Especially Mr. Tonsager and Mr. Hall whose nominations this Committee unanimously approved last year.
I would also like to give a warm welcome to Jed Welder. Jed served in both the United States Marine Corps and the U.S. Army. He and his wife Milka are now the proud owners of Trinity Farms in Greenville, Michigan.
It’s great to have you here today, Jed. Thank you not only for your service to our country but for also taking the time away from planting corn to join us – you have an important story to tell!
As many of us know, 100 years ago – in 1916 – Congress passed the Federal Farm Loan Act to address a serious problem facing our farmers and agricultural producers. A problem that threatened the long term success of our rural economy.
At that time – obtaining reliable credit was often unaffordable in most rural areas. Many lenders avoided farm loans altogether because the inherent risks of weather and price swings made lending to farmers unappealing.
As a result, Congress established the Farm Credit System to fill the gap in credit and provide American farmers and producers the financing they needed to expand in good times and weather the bad times.
100 years later – the Farm Credit System continues to ensure that producers of all types and sizes have adequate and reliable access to credit.
In fact – Farm Credit lenders nationally provide more than $200 billion in loans to rural America.
In my home state of Michigan, Greenstone Farm Credit provides more than $5 billion in loans to producers, including to more than 17,500 small, new, or beginning farmers that need access to capital.
And as we will hear from Mr. Welder – it was exactly this type of support that helped him secure land and create a new life for himself and his family after his military service.
However, as we look ahead to the next several years, we know that we are entering a period of low commodity prices – especially compared to what we have seen the past few years – which will make it more challenging for farmers to make ends meet.
This year alone, net farm income is projected to decline for the third consecutive year, a drop of 56 percent from 2013.
To weather this downturn, American farmers will continue to rely on commercial banks, USDA, and our farm credit system to provide the necessary short, medium, and long term financing that will allow American agriculture to continue to grow and prosper.
I am pleased that we will also be hearing from the lenders on our second panel who play an important role in providing credit to our farmers, producers, and food businesses throughout the entire food supply chain.
I would also briefly like to mention the longstanding support of the Farm Credit System by Senator Leahy. I understand our colleagues on the Appropriations Committee are marking up the Agriculture Appropriations bill this morning – keeping Senator Leahy from attending this hearing.
As Chair of the Committee during the 1990s when many important reforms were made to the Farm Credit System, Senator Leahy has asked me to submit for the record a transcript of his and then-Ranking Member Lugar’s floor statements during the consideration of one of these major changes.
I would ask the Chair to enter this statement for the record.
Thank you.
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