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Maximizing Agricultural Success: Utilizing Farm Financial Management Tools in Arkansas

2023 Delta States Farm Management Meeting

September 15, 2023

Ryan Loy, Ph.D.

Assistant Professor and Extension Agricultural Economist

Department of Agricultural Economics and Agribusiness

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Making a Positive Impact on Arkansas

My Extension Program Focus:

Farm Financial Education

Farm Management
Farm Finance
Risk Management

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Farm Financial Education

Maximizing Production
Optimal Allocation of Resources
Business Planning

Farm Management

Farm Programs
Budget Resources
Finance 101

Farm Finance

Market Activity
Value Added Marketing Channels
Macroeconomy/Profitability

Risk Management

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Arkansas Farm Financial Issues Survey�Number of Times Ranked First, n = 28

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The Plan?

“Financial Basics” Factsheet Series

Financial Position and Performance.
Familiarizing with Financial Statements.
Important Financial Health Criteria.
Metrics for a Successful Farm Business.

Understanding AR Enterprise Budgets

Virtual (or in-person) trainings.
Enterprise Budget Factsheets:

User Guide
Breakeven Analysis (2024 budgets)

Improve Accessibility.

AgriFinance Academy & FarmPulse AR

“AgriFinance Academy”:

Finance 101
FSA Loan Training Tool

“FarmPulse AR”:

Financial Report Card

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Financial Tools Brainstorm

FarmPulseAR

Web Application
Producer can:

Input financial statements.
Report card on financial measures. (barometer)
Benchmark against Ag sector.

Future:

Enterprise budgeting tool.
Data from AR crop budgets.
“What-if” Analyses.

AgriFinance Academy

Lecture videos, worksheets, and quizzes
Modules:

Basic Accounting Concepts
QuickBooks Training
Production, Inventory, and Cash Flows
Marketing Decisions
Understanding Financial Statements

Certificates for FSA

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Agricultural Lending in 2023

Type	Q2 2023 Rate (%)
Fed Funds	5.08
Prime Rate	8.25
Operating (Fixed)	8.52
Intermediate (Fixed)	8.14
Real Estate (Fixed)	7.65

Source: FRED Database & KC Fed

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Farm Financial Stress

Cost Category	Corn ($/Acre)	Cotton ($/Acre)	Rice ($/Acre)	Peanuts ($/Acre)
Seed	$104.00	$118.00	$44.00	$97.00
Fertilizer	$303.00	$192.00	$178.00	$64.00
Pesticides	$88.00	$197.00	$151.00	$77.00
Fuel (Irrigation & Equipment)	$25.00	$37.00	$23.00	$68.00
Q2 2023 Interest (8.52%)	$44.30	$46.35	$33.74	$26.07
Q2 2022 Interest (3.66%)	$19.03	$19.91	$14.49	$11.20