Posted July 6, 2023 | By: Allyson Bise, Financial Services Specialist

Young growers know finances are a top priority to establish, maintain and grow their operations. Shane Eason, a 30-year-old row crop farmer in Northeast Arkansas, recently established a line of credit through Nutrien Financial to pay for his input purchases. Financing his inputs has helped Shane stay ahead of the game during a year where inflation has skyrocketed and the cost of doing business keeps climbing.

Farming with family

Like many other young farmers, Shane started farming as part of a family operation. His dad and his uncle are both farmers, and when Shane’s dad developed some health issues, Shane’s uncle offered him assistance to get started in the family business.

“My uncle told me if I farmed with him that he would help me get started,” Shane says. “I didn’t really know what he meant by that and didn’t have a lot of details about how it would all work.”

Like many young growers who join the family business, Shane had family support. He was mentored by his uncle and received crucial guidance needed to start his operation. His uncle also provided labor, equipment for rent and co-signed on loans to help Shane get going. Even with that support, the financial side of farming hasn’t been easy.

“Nothing has come without a price. Ninety percent of the land I have has been acquired as an addition to the original family farm,” Shane says. “I had to start from the ground up and rent my uncle’s equipment to get to where I’m at now.”

Financing the business

To get into the business on his own, Shane needed a variety of financing partners to help pay for everything from land to equipment to inputs.

Shane’s bachelor’s degree in agricultural business management and master’s degree in agricultural economics helped him understand that financing would be critical to support his operation.

“I liked the idea of farming so I could work for myself, but the meanest person I ran into was that first banker I went to,” Shane says. “He almost made me cry. I was pretty scared, but he was doing it for my own good.”

Shane’s not alone in his experiences with banks and other financing options. In the 2022 National Young Farmer Survey by the National Young Farmers Coalition, 41% of respondents said that finding access to capital to grow their businesses was very or extremely challenging.

When Shane started out almost ten years ago, he was able to secure a loan by putting his personal truck up as collateral and having his uncle cosign.  He started farming on just 80 acres of rented dryland that his uncle switched over to him.  From there, he began looking for more land to farm.

Accessing affordable land

Accessing capital isn’t the only challenge young farmers face. According to respondents in the 2022 National Young Farmer Survey, 59% of respondents said finding affordable land to buy is very or extremely challenging.

Shane can attest, finding land is a big challenge. When he started looking for additional land to farm, he found a piece of land that wasn’t ideal for many reasons - the soil was bad, it was too close to a river - and nobody else wanted it.

“There was a big land sale on some of the worst ground around on the Cache River where we’re at, which is an awful place to farm,” Shane says. “Nobody wanted to farm it and someone thought that poor, pitiful soul Shane would probably farm it.”

Although Shane jokes about how bad the land is, farming it has helped him expand his operation over the last few years. Renting it was a risk that helped him increase his footprint, but he’s still operating one day and one week at a time.

“I’m just scratching and clawing and hoping I make it,” Shane says. He is not alone. Farming can be a risky business with a steep learning curve for young growers. 

Operating with financial acumen

In addition to his farm, Shane has a side business as a commodity broker that contributes to his overall financial picture. To ensure he can access capital when he needs to, Shane keeps his balance sheet in tip-top shape. Despite operating in a challenging time, Shane has never missed a payment on anything. He reviews his balance sheet and monitors his cash flow regularly to make sure he’s on track. In fact, he’d like to have more time to work on his finances, but has to wait for a rainy day to find the time.

Shane says, “I've been seriously wanting to get in there and spend an hour on my cash flow but we're in a little bit of a drought right now, so I have not worked on it. I know having strong credit is important.”

Shane works closely with his local branch and his Nutrien Financial reps to find the best economics on his inputs that meet his cash flow objectives.

“Shane is progressive in terms of taking advantage of supplier programs and interest rates that can help him get ahead,” Justin Burlison, the Nutrien crop consultant for Shane’s region, says. Nutrien splits his invoices and charges the correct portions to both Shane and his landlords so Shane never has to carry balances that aren’t his.  

The thing Shane appreciates the most about Nutrien is crop consultants like Justin. “Having dedicated reps like Justin (Burlison) and Allyson (Bise) walk you through the financing options really helps,” Shane says. “They’re knowledgeable and dedicated. I’ve had experiences with other dealers that have kicked me down the road when I’ve had questions. Having Allyson and Justin in-house to go to for assistance has been very helpful.”

While a lot of other retailers offer financing, that financing is often provided by a lending institution. This means a customer with invoice questions might have to call a third party for resolution. With Nutrien Financial, they can simply go back to the retailer and ask for help.

Having reps he can trust helps Shane focus his time on other parts of his financial strategy. “Part of what I try to do is keep all my money free. That way I can move money around whenever I want without being stuck,” Shane says. “What I like about the Nutrien Financial program is you still have working capital available so you can act when good opportunities come along. If all your money is tied up, you’ll miss a good investing opportunity.”

A few years ago, Shane needed to purchase grain bin equipment, but his operating line of credit was drained, so he had to seek out another loan. “If I would have been financing with Nutrien Financial at that time, I would have had the money available,” Shane says.

Shane values the relationships he has with his Nutrien representatives. He says the application process was incredibly easy - he filled out the application on the bed of his truck - and he values the ability to talk to person he knows, not a customer service line, about his invoices and purchasing options.

Looking to the future

While Shane is busy with the day-to-day of maintaining his operation, he does manage his finances with an eye to the future, not only for his sake but for his family’s.

“If I have a great year and everything goes well, I can make a bunch of payments and grow a bit. But if everything’s awful, I don’t know what I’ll do,” Shane says. “Some older generation farmers brag that they could lose a whole crop and be fine. I’m not built for that; I can’t afford a bad year.”

It’s even more crucial for Shane to succeed so he can support his family, including his two daughters who see their dad’s sacrifices every day. “I missed every t-ball game and family night at vacation bible school last week,” Shane says. “But it was harvest time and we needed to get the wheat out and beans planted before it rained.”

Shane hopes his daughters will come to appreciate the sacrifices he’s had to make but understands they might not agree with them. “The hardest part of being a young farmer is you miss out on so much with your family, but I can’t afford to get behind. My two little girls don’t understand that.”

By making smart money moves for his operation, Shane hopes he’ll be able to invest and grow in the future, which will help his family. “Stuff could flip flop in a few years and other farmers might retire, equipment will be cheaper, there will be more land,” Shane says. “It’s the way it goes - you just have to play the cycles.”

Shane says he doesn’t want to work for the rest of his life. He wants a retirement strategy, which is something he’s been able to think about thanks to his current financing plan, including working with Nutrien Financial.

“Farming is working for yourself, which I love. But sometimes the farm controls you,” Shane says. “If I get taken out, I’ll just say God wanted me to do something different. Either way, in 30 years I’d like to have a house on a beach somewhere instead of the rice field.”

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