Blog for Rural America

The Center for Rural Affairs, a private, non-profit organization, is working to strengthen small businesses, family farms and ranches, and rural communities. Permission to reprint items from this web log is hereby granted, on the condition that clear credit is given to the original source of the material. If the blog provides information for a story, please let us know by sending an email to

Wednesday, December 20, 2006

Farmers Guide to Agricultural Credit

Farmer’s Guide to Agricultural Credit

John Bonitz, Rural Advancement Foundation International – USA,

The Rural Advancement Foundation International - USA recently released "The Farmer's Guide to Agricultural Credit." The guide provides step-by-step advice on financing non-traditional farm-based enterprises.

The Farmer's Guide grew out of the Farmer & Lender Project, a partnership between RAFI-USA and the Self-Help Credit Union, supported by the North Carolina Tobacco Trust Fund Commission.

Creative ideas, from growing organic produce to grinding corn into grits, offer farms a way to stay afloat in financially challenging times. However, these ideas can be difficult to explain to lenders who are used to dealing with traditional commodity crops. Farmers have experience with getting annual operating loans, but are often unprepared for the amount of documentation lenders expect for a new enterprise. Agricultural lenders know how to assess risks and benefits of familiar crops, but few of them are prepared to evaluate a new kind of project.

The Farmer's Guide helps close this gap. It outlines how lenders evaluate loan applications, how to communicate ideas to lenders, and what resources are available to help along the way. A steering committee of farmers, commercial and agricultural lenders, representatives of state government and other experts helped produce the Farmer's Guide.

The Farmer's Guide is available on-line at

A limited number of printed copies are available by mail: North Carolina farmers may request a free copy by calling 919-542-1396.

Out-of-state shipping requires $10 to cover the costs of printing and postage.

RAFI-USA is a nonprofit organization dedicated to community, equity, and diversity in agriculture.

Post a question or comment here or contact John Crabtree,

Center for Rural Affairs
Values. Worth. Action.


  • At 12:07 AM, Anonymous Anonymous said…

    "Accessing capital is one of the many challenges facing farmers. Agricultural financing is crucial for maintaining production, expanding operations, or trying different enterprises. To maximize profits, more and more farmers
    and farm entrepreneurs are turning away from simple commodity crops in favor of more complicated or diversified enterprises. This can create a problem. New business models may be unfamiliar to agricultural lenders. So the farmer
    may need to take some extra steps in preparing and presenting his or her business plans. This Guide is a tool to help transitioning farmers and farm entrepreneurs to take those useful steps."

    This is a good report, this introduction explains why it is needed quite well. Thanks for posting this. Whiting, Iowa

  • At 11:57 PM, Anonymous Anonymous said…

    Accessing capital for entrepreneurial farm or ranch ventures IS difficult. A lot of what this guide talks about are ways to help bankers understand the venture (better business and marketing plans, etc.). But getting those plans done is difficult too. Value added producers grants can help a lot with funding for feasibility studies and business plans and the like. The Center has some good information on their website on that grant program (


Post a Comment

Links to this post:

Create a Link

<< Home