Farmers cautious amid volatility

Farmers in the Shenandoah Valley — which includes Virginia’s two most productive agricultural counties, Rockingham and Augusta — reacted to Wall Street rumblings with a wait-and-see attitude Tuesday, calling financial uncertainty a routine test in their industry

“I think the rest of the world is starting to experience the frustration that the farm business has been feeling for a long time,” said Augusta County Farm Bureau President Charles Curry, who raises beef cattle. “You have no control over the prices, so you take what you can get. It’s normal for farming.”

Despite market volatility and predictions of a broad squeeze on loans, the Virginia Farm Bureau predicted Tuesday that few farms will go out of business.

“There will be casualties,” said Jonah Bowles, agricultural risk management coordinator with the bureau. “But the farmer has got to be the most positive thinking individual in the world [as it is].”

Agricultural credit is supplied in large part by depositors and has not been as affected as have other sectors seeking credit. Farm interest rates have come down in the last year and farm delinquencies are at historic lows. Loan scarcity should not impact large and deeply invested farms, but entry-level farmers may struggle, said Tom Stanley, agent for farm management of the Virginia Cooperative Extension in Verona.

“Many [Valley] farms have significant equity in their real estate and as a consequence are in a fairly strong financial position,” Stanley said. “Credit, locally, is still available.”

Augusta County supervisor and beef cattle farmer Larry Howdyshell agreed.

“Locally, I think people know people, and as long as the banks can get their hands on money, the farmers aren’t at risk,” Howdyshell said.

Challenges will come to farmers whose seemingly reasonable purchases six months ago have now stretched thin their available capital, Bowles said.

But few farmers are panicking, especially while busy with the harvest season.

“Most farmers are pretty well tested,” Curry said. “It’s kind of amusing to watch politicians as they lose control.”

The Associated Press contributed to this report.