National network of farmer-owned cooperatives remains strong, vital credit source for agricultural producers and rural communities
DENVER, July 17, 2014 – Nearly 100 years after the U.S. Congress established Farm Credit www.farmcredit.com to serve as a reliable source of credit for the nation’s farmers and ranchers, the network of borrower-owned lending institutions and specialized service organizations remains a sound and vital resource for rural America. Today marks the cooperative networks’ 98th anniversary.
“For 98 years, the Farm Credit System has served agriculture and rural America as a dedicated, reliable, competitive, customer-owned source of credit,” said Mary Fritz, owner and operator of Quarter Circle JF Ranch, Inc., a dry land grain and cow-calf operation in Chester, Montana, and chair of the Farm Credit Council board of directors. “America’s agricultural producers and rural communities have benefited greatly from the vision and foresight that went into establishing the Farm Credit System.”
Today, about 40 percent of the dollar volume of outstanding loans to U.S. farmers and ranchers comes from Farm Credit. The federally chartered network is comprised of 82 privately owned institutions, including four wholesale banks and 78 direct lending associations that operate in every county in all 50 states and Puerto Rico.
These local Farm Credit System institutions specialize in providing credit and related services to farmers, ranchers, timber harvesters and aquatic producers. In addition, the Farm Credit System provides financing for the processing and marketing activities of these borrowers, as well as to rural homeowners, certain farm-related businesses, and agricultural and public utility cooperatives.
In support of their mission of service, Farm Credit System institutions also have programs specifically focused on meeting the needs of young, beginning and small farmers and ranchers. In 2013, more than 40 percent of new loans made by Farm Credit were to small producers, those with annual gross agricultural sales of $250,000 or less.
“Our cooperative model is designed specifically to ensure that our lending and related financial services are driven by the needs of our borrower-owners,” Fritz said. “Our focus remains on the success of our owners rather than on achieving quarterly returns to impress stockholders.”
Farm Credit’s commitment to its borrower-owners is demonstrated further by the fact that associations share profits directly with borrowers through patronage dividends. In 2013, the Farm Credit System distributed more than $1 billion in cash patronage, allowing borrower-owners to reinvest in their own operations and to further support rural communities through local spending.
”Today, Farm Credit celebrates its heritage as it continues to fulfill its mission to serve U.S. agriculture and rural America,” Fritz said. “Farm Credit was established as a permanent system of credit that is to be responsive to the needs of our nation’s agricultural sector, and we look forward to continued success and a bright future.”
About the Farm Credit System
For nearly a century, Farm Credit has been a national provider of credit and related services to rural America through its cooperative network of customer-owned lending institutions. Farm Credit provides more than $200 billion in loans and leases to farmers, ranchers, rural homeowners, aquatic producers, timber harvesters, agribusinesses, and agricultural and rural utility cooperatives. For more information about the Farm Credit System, please visit www.farmcredit.com.