And joining us now is Tim Cook. He is the Chief Credit Officer for Frontier Farm Credit. Farm Credit Services of America. Tim, thanks for joining us.
– Yeah, thanks Ken. Pleasure to be on.
– Well, interesting times in production agriculture as we wrap up what has been very much and interesting year that agriculture has had to play in it. But one of those things that we continue to read reports and see things from the Federal Reserve Bank that agriculture is gonna come through this, all be it with some help. But kind of what’s the 3000 foot view that you see AgCredit in helping production agriculture?
– Yeah, interesting to say the least. Is if we back up to maybe three or four or five months ago, things look pretty bleak for agriculture. The cattle sector was having trouble getting cattle killed, and corn and soybean prices looked pretty tough. Now, as we fast forward to today, as you reference, it looks like overall farm profitability for 2020 is gonna be very, very strong. There’s no doubt that the farm program payments, as well as the disaster assistance payments tied to COVID, the CFAT payments, it had a big impact on that. But I think we’d be remiss if we didn’t recognize that the overall commodity price and fireman and the most recent rally is a big component of that as well.
– Well, it is and that we’ve talked with other folks and go well, that helped in 2020, but looking at 2021, a lot of those things won’t be there, and so we’re gonna have to find someplace for all these crops to go.
– Yeah. Well, and that’s the positive thing. It looks like we’ve entered into a demand-driven markets. These last several years, it’s been the supply side that’s really driven any price valleys we’ve had, but with China coming back into the market in a big way for US crops, both corn and soybeans, and looking like South America’s at least for the time being having some weather challenges. I think there’s at least some short-term legs underneath these crop prices that we’re seeing, and we’re optimistic. And if we look at the futures market, there’s certainly an opportunity for producers to hedge some profitable levels for 2021 as well.
– Tim Cook is the Chief Credit Officer for Frontier Farm Credit and Farm Credit Services of America. We’re gonna take a break, and we’ll have more with him in just a moment.