Farming is unpredictable, with many outside forces dictating your success in the field. Since you can’t control the weather, the only thing that can guarantee a yield, or indemnity in place of a yield, is crop insurance. Crop insurance can help you survive an unforeseen disaster and return your business to profitability, improve your cash flow in a down year, and manage your risk.

As we look ahead to the spring and prepare for planting season, now is a great time to seriously consider getting reliable coverage for your operation.

How does crop insurance help me manage my operation’s risk?  

Crop insurance can provide agricultural producers protection on two major sources of risk: production and price. As we experience more extreme weather patterns, crop insurance can help protect you when adverse weather events take a toll on your crop production, which will enable you to recover faster.

Aside from weather, another unpredictable variable producers face is the market. Crop insurance will also cover you when there is a loss in crop revenue due to price fluctuations. Having this coverage ensures a reliable level of cash flow and will allow more flexibility in your marketing plan.

Your lender likes to see crop insurance as part of your business plan because it shows that, with some level of production insured, the crop could be forward priced with greater certainty, creating a more predictable level of revenue. It will show that even amid disaster, you will have repayment ability, which will help ease your financial risk when applying for a loan or line of credit. Crop insurance enables your operation to meet your financial obligations and ensure the survival of your farm business.

What types of crop insurance are available for my operation?

Depending upon the type of operation you manage and its unique needs, there are several types of policies available to you. Please contact your crop insurance agent to discuss the details of each to help you determine which makes the most sense for your business.

• Yield Protection
• Revenue Protection
• Dairy Revenue Protection
• Livestock Risk Protection
• Hail/Fire Policies
• Whole Farm Revenue Protection
   

If you have any questions about your current policy or want to discuss the options available for your operation, contact our crop insurance agents prior to the March 15th spring crop sales closing deadline at 888.339.3334, or visit FarmCreditCropInsurance.com. We can review changes in your operation, discuss any concerns, and provide customized quotes that outline your coverage options and give you an estimated premium cost. We’re here to help you get growing this spring and beyond!

This article was written by Kathi Levan, Horizon Farm Credit Crop Insurance Manager.

What is MARBIDCO?

The Maryland Agricultural & Resource-Based Industry Development Corporation (MARBIDCO) is a quasi-public economic development organization chartered by the State of Maryland. Their mission is to help Maryland's farm, forestry, and seafood businesses succeed through financial partnership and other services.

What MARBIDCO offers

• Loan and grant programs for farmers, watermen, and rural business owners
• Land preservation programs to assist landowners in securing and protecting rural lands
• Partnerships with commercial lenders (like Farm Credit!) to maximize rural lending opportunities
• Business resources and planning tools for rural entrepreneurs

How does Farm Credit work with MARBIDCO?

Farm Credit can lend up to 80 percent of the appraised value or the purchase price, whichever is less, which equates to a 20 percent down payment. We understand this can be a challenge, especially for those that are young, small and/or beginning farmers. For our Maryland farmers, MARBIDCO is a resource we can turn to in order to help bridge that gap.

Here are some first steps:

1. Research MARBIDCO and the programs they offer:
   • Land preservation option – Rural Land Preservation Facilitation and Next Gen Programs | MARBIDCO
   • Loan options – Agricultural & Rural-Business Industry Loan Programs | MARBIDCO
2. Reach out to Farm Credit and one of our loan officers can help facilitate a call with the MARBIDCO staff, which will include checking the farm business and/or property’s eligibility
3. Proceed to application process

Ready to apply?

1. Prepare a robust farm business plan (Not sure where to start? Click here.)
2. Apply with Farm Credit (items to include: loan application, financials and business plan)
   Loans are evaluated for:

• Repayment: Ability to pay any debts (farm and personal) with income being generated
• Liquidity: Available cash on hand to service any debt payments within the next 12 months
• Equity: Looking at your ratio of assets to debt
• Credit: Pull credit report and evaluate history. Looking for no late pays, bankruptcies, tax liens
• Collateral: Evaluating value of the property to be purchased via appraisal

3. Once approved with Farm Credit, complete the MARBIDCO application process with assistance from your Farm Credit loan officer

What’s next?

The process of applying with Farm Credit and then MARBIDCO can take up to six months to complete. Be sure to inform all parties (sellers, real estate agents, attorneys) involved from the very beginning that you plan to work with both Farm Credit and MARBIDCO, to ensure this process goes as quickly and as smoothly as possible.

How does this partnership work?

Here’s an example scenario:

You are interested in purchasing a 100 acre farm. The proposed purchase price is $1,000,000. You have strong credit and a good income history. You know from your prior conversations with Farm Credit we require a 20 percent down payment. Your loan officer recommends two potential options for you to consider with MARBIDCO assistance:

Option 1: MARBIDCO Next Gen grant

• Utilize the farmland conservation easement option purchase program to help preserve the subject property from future development; this is an easement option purchase, which will limit land usage in the future
• MARBIDCO will pay up to 51 percent of the Fair Market Value (FMV) of the land only (with a cap of $500,000)
• Those interested in applying to the Next Gen program are requested to make contact with the county farmland preservation program office to determine eligibility of the property. (Not sure who to ask? Your loan officer can help you contact your local office.)
• Closing Transaction Fee: $2,500 (Next Gen only)

                       $1,000,000         (purchase price)

                       -$200,000            (MARBIDCO Next Gen grant)

                       $800,000             (Farm Credit loan amount)

Option 2: MARBIDCO Maryland Resource-Based Industry Financing Fund (MRBIFF)

• Can lend between 20-40 percent of financing needed, but MARBIDCO’s financing must be no greater than Farm Credit’s loan amount
• Current MARBIDCO interest rate*: 3.75% for first three years, 4.50% for the next three, and 5.75% for remaining life of loan
• Will typically have a balloon at ten years and require you refinance remaining balance
• Loan Origination: 1% of MARBIDCO loan amount (MRBIFF only)

                       $1,000,000 (purchase price)

                       -$350,000   (MARBIDCO loan amount)

                       -$50,000     (your cash down payment)

                       $600,000    (Farm Credit loan amount)

Are you searching for beginning farmer resources? Check out our beginning farmer page or our agriculture loans page. If you need help understanding how MARBIDCO and Farm Credit can work together to maximize your options, give us a call at 888.339.3334. We're here to help!

*As of January 31, 2023.

Horizon Farm Credit announced the results of the 2022 election for its Board of Directors.

Six positions on the 27-member Horizon Farm Credit Board were up for election this year.  Sam Parker (Delmarva Region); Sharon McClellan (Northeastern Pennsylvania Region); and Carl Metzgar (Southwestern Pennsylvania Region) were elected and will be joining the Board.  Brian Boyd (Keystone Region); Steven H. Gross, Jr. (Southcentral Pennsylvania Region); and Michael Nelson (Potomac Region) were re-elected to their positions on the Board. There were no open positions in the Northwestern Pennsylvania election region.  Each Director was elected to a four year term, which will begin January 1, 2023.

Horizon Farm Credit is a member-owned cooperative, and part of the national Farm Credit System. The Association’s Board of Directors and nominating committee are comprised primarily of Farm Credit borrowers, they’re elected by other borrowers, and they work together to make sure the Association continues to fulfill its mission to support America’s farming families.

“Farm Credit’s unique cooperative structure brings value to our customers,” says Tom Truitt, CEO of Horizon Farm Credit. “Our Board is comprised almost exclusively of our borrowers, who are considered members of Farm Credit,” he continued.  “Every member truly has a voice in how we operate as an Association and we appreciate everyone who took the time to vote in the election.”

The 2022 election took place via mail and email, with the ballots going out to all voting stockholders in November. For more information about Horizon Farm Credit’s board of directors, or to learn how you can become a candidate for a board position, please visit horizonfc.com/about/leadership.

Horizon Farm Credit joins with The Food Bank of Delaware to fight hunger during the holidays with a $25,000 donation.

“As a cooperative, our Association is deeply connected to our local communities,” said Tom Truitt, CEO of Horizon Farm Credit. “Our farmers have committed their lives to feeding people and serving the needs of others; supporting the great work being done by the Food Bank of Delaware is an additional way for us to honor those commitments,” Truitt continued. “We want to do all we can to ensure that our friends and neighbors have access to fresh, local, and nutritious food, especially this holiday season.”

The need for monetary and food donations is typically high during the winter months, but this year, the need is expected to be especially elevated. “We are so thankful for the support of Horizon Farm Credit,” said Food Bank of Delaware President and CEO Cathy Kanefsky. “This gift represents a commitment to the community, especially during this holiday season. We know so many in our community are struggling to make ends meet, while also thinking about where they will get resources to celebrate the holidays with family,” Kanefsky said, “this gift will give hope to so many families and allow them to enjoy this special time.”

Information about The Food Bank of Delaware can be found at fbd.org.

Horizon Farm Credit partnered with Feeding Pennsylvania, a statewide network of food banks, by donating $110,000 to fight hunger during the holidays and beyond.

“As a cooperative, our Association is deeply connected to our local communities and customers,” said Tom Truitt, CEO of Horizon Farm Credit.  “Our farmers have committed their lives to feeding people; they’re producing high quality, nutritious food and are doing so more efficiently than ever,” he said. “Despite the tireless work of our farmers, too many Pennsylvanians struggle with access to fresh, local food,” Truitt continued. “We want to do all we can to further support those facing food insecurity.”

The need for monetary and food donations is typically high during the winter months, but this year, the need is expected to be especially elevated. “With the inflation rate at its highest in 40 years, many Pennsylvanians are facing impossible choices between buying food and paying for other necessities, like rent and medicine,” said Jane Clements, CEO of Feeding Pennsylvania. “And when difficult times hit, food can be the first thing people forego to make ends meet.”

Clements went on to thank Farm Credit for being attuned to the community’s needs within its service area and for its commitment to combating food insecurity. “This generous donation from Farm Credit will support Feeding PA and our member food banks in our mission to ensure that no one in Pennsylvania goes without nutritious food, especially as we head into the holiday season."   

In today’s increasingly digital world, nearly everything in our lives exists within a phone, computer, TV, or tablet. Even kitchen appliances such as refrigerators these days now have their own digital or “smart” component. Whether we run from it or embrace it, technology is there and seems to be advancing by the day.

With all of these new tools and our increasing use of digital methods comes an increase in cyber attacks, identity theft, and hacking of information stored online. Using these exciting new technologies can be fun and make our lives easier, but when they are used to store important data and personal information, it is crucial to keep that information safe and secure.

Jeff McKay, Information Security Manager for Farm Credit, advises that today’s cybersecurity landscape is largely dominated by two things: social engineering and ransomware. Social engineering is when someone tries to manipulate you into performing an action or sharing confidential information. Cybercriminals use social engineering to access computer systems, gather information, or make money. Three of the most common methods of social engineering are malicious links, fake web pages, and impersonations.

“Social engineering is always present with criminals trying to get you to reveal confidential information through seemingly legitimate interactions,” says Jeff.

Ransomware is equally as dangerous and tends to be the leading threat users face in today’s environment. It can be delivered using multiple channels including email, pop-ups, or suspicious websites.

“At Farm Credit, we utilize firewalls within different levels of infrastructure. Traffic coming in and out of Farm Credit’s systems are continuously monitored for any kind of suspicious activity that could indicate a bad actor is trying to gain access or compromise an internal system,” explains Jeff.

Farm Credit also requires all staff to complete regular cybersecurity training and tests them to ensure they are aware of many different threats they could encounter.

Some general everyday practices and tips for keeping your data safe include:

• Double (or triple!) check links before clicking them – this can be done by hovering over a link or entering the URL directly into a separate browser. If it seems suspicious, it probably is.
• Create strong passwords…and don’t re-use. A password that is unique, and at least 12 characters long and a combination of lowercase and uppercase letters, numbers, and symbols is a smart place to start. Your passwords should be as long, complex, and random as possible.  You should avoid using the same passwords across multiple websites.
• Use multi-factor authentication, if it’s an option. This requires multiple forms of authentication such as a password or code sent to your phone via text message that you then must enter as part of the login process before you are allowed into your account. 
• Choose your own settings for data tracking when browsing the web. Most websites will ask you permission to track your activity through cookies. You can opt-out of or block most third-party cookies. If you want to only allow certain permissions, you can adjust your web browser’s settings.
• Avoid oversharing on social media. Guard your personally identifiable information by limiting what you share online. This includes being aware of subtle methods of information gathering such as quizzes that ask for personal details like your mother’s maiden name or your date of birth. Over time, cybercriminals could collect enough details to hack your accounts or steal your identity.

While cybersecurity threats are ever-present and have come to be almost routine or expected, it’s still important to stay alert – you can never be too cautious when it comes to your personal identity and information.

For more information on keeping your data secure, the Federal Trade Commission provides resources on what to do if you think your data was exposed, as well as identity theft safety and prevention tips.

For more information about Farm Credit’s privacy and security policies, visit horizonfc.com/privacy-security.

Horizon Farm Credit has announced the 2022 third quarter financial results. Net accruing loan volume for the first nine months of 2022 was $5.8 billion, an increase of 98.4 percent compared to the same 2021 period. Net interest income for the third quarter of 2022 was $42.8 million, a 119.3 percent increase from the same time period in 2021. Net income for the quarter was $34.7 million, a 152.0 percent increase compared to the third quarter of 2021, principally related to the favorable impact of the merger with legacy AgChoice Farm Credit.

“We at Horizon Farm Credit are pleased to be seeing continued growth, diversity, and investment in agriculture, which in turn, drives the financial success of our Association,” said Tom Truitt, Horizon Farm Credit’s Chief Executive Officer.  “Our performance is reflective of our members’ performance as well as our commitment to serve the farmers in our region. We are continually inspired and humbled by our mission to help members of the agriculture community secure the capital they need to build, expand, or improve their operations.” 

Nonaccrual loans decreased $2.0 million in the third quarter of 2022 to $35.6 million, compared to $37.6 million at December 31, 2021 and $40.3 million at September 30, 2021. The association’s nonaccrual loans as a percentage of total loans decreased to 0.60 percent at the end of the third quarter of 2022, compared to 1.24 percent at the end of 2021 and 1.34 percent at the end of the third quarter of 2021.

Members’ equity at September 30, 2022 totaled $1.1 billion, up 66.9 percent from December 31, 2021, and the Total Capital Ratio was 17.23 percent. That number is compared with the 10.5 percent minimum mandated by the Farm Credit Administration (FCA), the Association’s independent regulator. MidAtlantic Farm Credit distributed a record-breaking $83.9 million in cash patronage distribution to its members in March 2022, based on 2021 earnings. AgChoice Farm Credit paid a record-breaking $50.2 million in cash patronage distribution based on its 2021 earnings, meaning Horizon Farm Credit member-borrowers received over $134 million in combined patronage.