Every five years the U.S. Department of Agriculture (USDA) conducts a Census of Agriculture to gather information on the state of agriculture in the US. And this year brings bad news for the Farm Credit System (FCS) and the young, beginning and small farmers and producers that it has a legal duty to serve.
The 2017 census reveals that there are roughly 908,000 beginning producers across the country. With around 3,447,000 producers countrywide, that means more than one out of every four producers is just beginning to farm. The future of agriculture in the US depends on beginning farmers.
Farm Credit has a legal duty to provide credit to these farmers. But the numbers show that it isn’t doing enough: only 15 percent of its 2017 loan volume went to beginning farmers. And to make things even worse, Farm Credit doesn’t lend to everyone in this category, only to fewer than one in three. The System simply isn’t doing enough to sustain and support beginning farmers, the future of American agriculture.
There’s a reason why the System has a legal obligation to furnish sound credit to young, beginning and small farmers. Small farms are small businesses which support their communities; beginning farmers need extra support to begin their operations; young farmers need more guidance as they develop their skill-set. All three categories need sound credit because they’re more vulnerable and more likely to fail. If they fail, then the future of American agriculture is in peril.
That’s why Congress gave Farm Credit this mission.
Congress needs to hold Farm Credit to that mission. It needs to keep the FCS’s regulator, the Farm Credit Administration (FCA), from being captured by the very special interests it was created to regulate. If either the FCS or the FCA fails to fulfill its duty, then Congress must act. And to make sure that the FCS and FCA keep to their missions, Congress must hold yearly oversight hearings.
