Agri Business Review: Specials Magazine

Griculture has always been shaped by uncertainty, but the pressures facing farmers today have become increasingly complex. Stagnant commodity prices, rising input costs, and global economic conditions have significantly narrowed profitability in recent years. Ag Resource Management (ARM), an established player in agricultural finance, has continued to adapt its services to meet these changing conditions. Under the leadership of Chad Hunter, Chief Revenue Officer, ARM provides crop-based financing solutions designed to reflect the realities of modern farming and give growers greater flexibility as market conditions evolve. Responding to the Challenges Facing Farmers Today’s producers need more than access to capital. They need financial partners who understand the operational realities behind each crop decision and can provide versatile solutions as conditions change. ARM’s approach is built around the belief that agricultural lending should reflect a farmer’s current production potential, not simply their historical performance or existing asset base. Traditional agricultural lending often evaluates credit primarily through land ownership, equity, and previous financial records. While these factors can provide valuable context, they may create challenges for growers who need working capital but want to preserve their long-term assets. They can also limit access for newer producers who have not yet built a substantial asset base, even when their current operations have strong revenue potential.

U.S. Farmers need liquidity for estate planning, retirement and farm succession. U.S. investors need a low-volatility, low-risk, stable income-generating investment. America’s farmland is entering a generational ownership transition. According to the USDA, about 70 percent of U.S. farmland is expected to change hands over the next 20 years, driven by the aging farming population. This creates a need for ways to change ownership while allowing farming families to continue farming. At the same time, investors are seeking diversification through assets with relatively lower volatility than stocks and not correlated to stocks and bonds. Sower Farmland operates at that intersection It acquires investment-grade row-crop farmland from farming families through sale-leasebacks, typically at a discount, and then leases the land back to the families, their heirs or other operators. This gives landowners liquidity, keeps the land productive and provides investors with exposure to farmland without directly owning or managing individual properties. Sower’s evergreen private fund reinforces its long-term approach. Unlike a closed fund that may eventually need to liquidate its holdings, the structure enables the company to continue owning and leasing the land without a predetermined exit. For farmers who sell land through a sale-leaseback, the evergreen fund enables them to continue operating the property without facing a fund-driven sale later. “We knew there was a pipeline of opportunities to buy and manage these farms, and an evergreen private fund was the best vehicle for diversification,” says Chris Chard, managing director. Turning Local Relationships into Opportunities Sower’s relationships with farmers create opportunities for operators to expand without purchasing additional land. As sellers may continue farming the property after a sale-leaseback, the company’s reputation for treating landowners fairly is key to building the trust that supports these transactions. Existing operators can also approach Sower when neighboring farmland comes up for sale. It refers to these acquisitions as bolt-ons, where an existing farm can become the starting point for acquiring neighboring farmlands. The approach also enables access to off-market opportunities. About half of farmland transactions never become listed properties, creating opportunities for Sower to identify farms through its local relationships. Sower evaluates potential acquisitions around the characteristics it considers fundamental to investment-grade row-crop farmland, particularly strong soil quality and reliable water availability through rainfall or irrigation. Its portfolio spans more than seven states, with much of it concentrated across the Corn Belt, including Nebraska, Iowa and Illinois. The company also sees opportunity in smaller investment-grade farms that may fall below the transaction sizes sought by larger institutional buyers.

For decades, agriculture has focused heavily on inputs designed to increase production. But according to Bio Minerals Technologies, Inc. (BMT), the conversation around soil health must begin much deeper—with understanding how nature itself designed the relationship between minerals, microorganisms, and plants. BMT works with growers who are looking beyond conventional approaches and seeking ways to rebuild soil function. The company’s philosophy centers on restoring the biological and mineral balance of soil while helping farmers understand the processes that drive healthy plant growth. Looking Beyond the NPK Model Ken Hamilton, Owner of Bio Minerals Technologies, believes one of the biggest challenges in modern agriculture is the limited focus on nitrogen, phosphorus, and potassium. While these nutrients play a role in plant development, BMT emphasizes that they represent only a small portion of what plants require. The company’s approach looks at the larger biological system beneath the surface. Soil microorganisms, including bacteria, fungi, protozoa, and nematodes, help convert minerals and atmospheric elements into forms plants can use. Without these organisms performing their natural functions, plants lose access to much of the nutrition available within the soil.