Loan Programs

Association News

Financial Reports

Contact a Loan Officer

Cooperative Business Model Proves Resilient

There’s a common saying about the weather that also applies to the economy. If you don’t like it right now, wait a while and it will change.

We’re experiencing a little of that feeling right now. Last year presented Panhandle-Plains Land Bank with a lot of challenges, because of the worldwide financial crisis and volatile ag markets. After years of enjoying a positive lending environment and consistently solid earnings and loan volume, our progress slowed significantly last year. The negative lending
environment took a toll on our bottom line. We recognize that unfortunately the economic conditions created hardship for some of our customers, too.

It was a good thing that, after more than 90 years in the business, we had experience weathering the ups and downs in the economy. We held teady, thanks in large part to the solid, conservative lending decisions by our board. The cooperative business model upon which Farm Credit is founded also proved to be resilient during tough times.

Thankfully, several months into 2010, the situation shows signs of improvement. Industries that rely on grain prices, such as livestock feeding operations, dairies and ethanol, suffered from a tight financial squeeze caused by extremely high corn prices last year. Now, input costs have stabilized at manageable levels, and market prices have increased, bringing some much-needed relief for many producers. Pork, cattle, poultry and ethanol producers are looking up right now. Unfortunately, much of this relief will come at the expense of grain producers, but commodity prices should also remain at profitable levels.

The situation has improved for dairy producers, too. For a while, the price of milk was lower than the cost of production. Under those conditions, even the best dairy producers could not turn a profit. Fortunately, milk prices are on the rise, so there appears to be some improvement in the dairy industry, although it will be months before that improvement is fully realized.

At Panhandle-Plains Land Bank, we look forward to better days ahead and the opportunity to share our success with you, our customer-stockholders. As always, we thank you for your business and will strive to meet all of your rural financing needs. We hope that 2010 will be a better year, both for Panhandle-Plains Land Bank and for each of our customers.

Sincerely,

Robert R. Williams, Jr.
Chief Executive Officer