Agricultural Finance Review最新文献

{"title":"Farmer sentiment and farm service agency direct loan applications","authors":"Chad M. Fiechter, Megan N. Hughes, Sarah A. Atkinson, James Mintert, Michael R. Langemeier","doi":"10.1108/afr-09-2023-0126","DOIUrl":"https://doi.org/10.1108/afr-09-2023-0126","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>Farmer sentiment may be an important indicator for the agricultural sector, similar to the way that consumer sentiment is linked to the general economy. This study uses the Purdue University–CME Group Ag Economy Barometer to test the degree to which farmer sentiment is correlated with demand for United States Department of Agriculture Farm Service Agency (FSA) direct loan applications.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>We estimate the dynamics between farmer sentiment and applications to FSA direct operating or farm ownership loans using monthly measures of farmer sentiment and loan applications from October 2015 to April 2023 and pairwise vector autoregression.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>A negative relationship exists between farmer sentiment and FSA direct operating loan applications. In contrast, a positive relationship exists between farmer sentiment and FSA direct farm ownership loan applications. Together, the estimated nonzero relationships suggests that the Ag Economy Barometer may be a leading indicator for the Agricultural Economy and that FSA loan programs play a nuanced role in the agricultural credit market.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This study uses unique data sources to further the discussion on the link between farmer sentiment and real economic outcomes and the role of an important US Federal Government farmer lending program: FSA direct loans.</p><!--/ Abstract__block -->","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"62 1","pages":""},"PeriodicalIF":1.6,"publicationDate":"2024-05-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140932136","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Resilience of agricultural banks during economic downturns","authors":"Madhav Regmi, Noah Miller","doi":"10.1108/afr-08-2023-0099","DOIUrl":"https://doi.org/10.1108/afr-08-2023-0099","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>Agricultural banks likely respond differently to economic downturns compared to nonagricultural banks. Limited previous research has examined the performance of agricultural banks under economic crisis and in the presence of banking regulations. This study aims to explore agricultural banks' responses to economic and regulation shocks relative to nonagricultural banks.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>This study uses bank-quarter level data from 2002 to 2022 for virtually all commercial banks in the U.S. In this research, the Z-score measures the bank’s default risk, the return on assets measures bank profitability and changes in amount of farm loans indicate the wider impact on the agricultural sector. Effects of the financial crisis, Basel III reforms to banking regulation and the coronavirus (COVID-19) pandemic on these banking measures are assessed using distinct empirical frameworks. The empirical estimations use various subsamples based on bank types, bank sizes and time periods.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>Economic downturns are associated with fluctuations in returns and the risk of default of commercial banks. Agricultural banks appeared to be more resilient to economic downturns than nonagricultural banks. However, Basel III regulated agricultural banks were more likely to fail amidst the pandemic-related economic shocks than the regulated non-agricultural banks.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This study examines the resiliency of agricultural banks during economic downturns and under postfinancial crisis regulation. This is one of the first empirical works to analyze the effectiveness of Basel III regulation across bank types and sizes considering the COVID-19 pandemic. The key finding suggests that banking regulation should consider not only size heterogeneity but also the heterogeneity in lending portfolios.</p><!--/ Abstract__block -->","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"27 1","pages":""},"PeriodicalIF":1.6,"publicationDate":"2024-04-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140617324","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"A comparative study of capital structure compositions in grain marketing and input supply cooperatives","authors":"Jasper Grashuis, Keri Jacobs","doi":"10.1108/afr-09-2023-0112","DOIUrl":"https://doi.org/10.1108/afr-09-2023-0112","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>The objective of the study is to explore explanations for the capital structure compositions of farmer cooperatives, which have a unique equity structure with allocated equity as well as unallocated equity.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>Data came from a panel of US grain marketing and input supply cooperatives for the 2010–2020 period. The study is concerned with the proportions of debt, allocated equity and unallocated equity, which requires the application of a fractional multinomial panel model to ensure predictions fall within the observed data range (i.e. 0–1).</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>Larger cooperatives have relatively high debt proportions. Diversification of the product portfolio has a positive effect on the debt proportion. Profitability is associated with higher debt proportions in input supply cooperatives and higher allocated equity proportions in grain marketing cooperatives. Over time, the proportion of unallocated equity increased. Overall, some results differ across grain marketing and input supply cooperatives.</p><!--/ Abstract__block -->\u0000<h3>Practical implications</h3>\u0000<p>Increasing proportions of unallocated equity warrant a debate about the future value of ownership and governance by members of farmer cooperatives.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>Previous empirical investigations of the capital structure compositions of cooperatives lacked a distinction between allocated and unallocated equity. Our results show that the proportions of the two equity accounts respond differently to given predictors. Furthermore, much of the prior empirical literature fails to separate cooperatives on the basis of economic activities (i.e. marketing, supply and mixed).</p><!--/ Abstract__block -->","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"72 1","pages":""},"PeriodicalIF":1.6,"publicationDate":"2024-04-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140599521","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Differences in financial outcomes for family and nonfamily farms","authors":"David J. Williams, Francisco Scott","doi":"10.1108/afr-09-2023-0115","DOIUrl":"https://doi.org/10.1108/afr-09-2023-0115","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>Nonfamily farms are responsible for a disproportionate amount of US agriculture production. The importance of these operations to the volume of agriculture production in the United States has led researchers and policymakers to understand nonfamily farms as large commercial operations. This paper examines whether the distinction between family and nonfamily helps explain the financial outcomes of farm operations and households.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>We test for differences in financial outcomes of the household and operations of family and nonfamily farms using an Oaxaca-Blinder decomposition. We compare these results to a decomposition of other possible typologies.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>We present evidence that nonfamily farms are a heterogeneous group with a majority of small operations that are dominated by a small number of large operations. We discover that differences associated with the family-nonfamily distinction are largely explained by observable farm and operator characteristics that arise mechanically from the definition. However, we find suggestive evidence that family-nonfamily classification captures differences in economic behavior that lead to higher profitability measures to nonfamily farms. We find little evidence of any inherent structural differences between family and nonfamily farms that helps explain financial outcomes related to leverage or household finances.</p><!--/ Abstract__block -->\u0000<h3>Practical implications</h3>\u0000<p>We conclude that including nonfamily farms in official statistics of farm households may provide a more comprehensive overview of the farm sector, as our results suggest that family and nonfamily farms do not have innate differences that help explain many of their financial outcomes.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>We incorporate previously unused data on nonfamily farm households and test the difference in mean financial outcomes between family and nonfamily farms.</p><!--/ Abstract__block -->","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"35 1","pages":""},"PeriodicalIF":1.6,"publicationDate":"2024-03-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140156253","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Change in US farm sector's financial position and performance in 2020 compared to pre-pandemic expectations: An analysis using financial ratios","authors":"Anil K. Giri, Carrie Litkowski, Dipak Subedi, Tia M. McDonald","doi":"10.1108/afr-02-2023-0024","DOIUrl":"https://doi.org/10.1108/afr-02-2023-0024","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>The purpose of this study is to examine how US farm sector performed in 2020, the first year of the pandemic. There were significant supply and demand shocks due to the pandemic. Furthermore, there was significant fluctuation in commodity prices and record high government payments in 2020. This study aims to examine the performance and position of US farm sector (financially) to system (and global economy) wide shocks.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>The authors examine 2020 values for farm sector financial ratios before and after the onset of the Coronavirus (COVID-19) pandemic using the data from the United States Department of Agriculture to understand the financial position and performance of the US farm sector.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The authors find solvency ratios (which are indicators of the sector's ability to repay financial liabilities via the sale of assets) worsened in 2020 relative to pre-pandemic expectations. Efficiency ratios (which evaluate the conversion of assets into production and revenue) and liquidity ratios (which are indicators of the availability of cash to cover debt payments) showed mixed outcomes for the realized results in 2020 relative to the pre-pandemic forecasts. Four profitability ratios were stronger in 2020 relative to pre-pandemic expectations. All solvency, liquidity and profitability ratios plus 2 out of 5 efficiency ratios for 2020 were weaker than their respective average ratios obtained from 2000 to 2019 data.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This research is one of the first papers to use financial ratios to examine how the US farm sector performed in 2020 compared to expectations prior to the pandemic.</p><!--/ Abstract__block -->","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"18 1","pages":""},"PeriodicalIF":1.6,"publicationDate":"2023-12-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139030249","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Impact of interest subvention scheme (ISS) on the behaviour of farm households: a case of Andhra Pradesh and Madhya Pradesh","authors":"Shubham Kumar Sehgal","doi":"10.1108/afr-03-2023-0036","DOIUrl":"https://doi.org/10.1108/afr-03-2023-0036","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>Credit is an essential element in the production process in agriculture. There are two sources from which farm households can access credit: institutional sources and non-institutional or informal sources of credit. The informal sources of credit, such as moneylenders, charge exorbitant rates of interest, which further puts a financial burden on the farmers. Hence, to increase the flow of credit from institutional sources, a policy known as the interest subvention scheme (ISS) was introduced in the year 2006. This paper aims to find the effect of the ISS on the behaviour of farm households.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>The author has used difference-in-difference analysis for estimation. In the analysis, the author has taken Madhya Pradesh as the treatment state and Andhra Pradesh as the controlled state. The author has used the Village Dynamics in South Asia (VDSA) dataset of ICRISAT for analysis. The author has used data from 2009 to 2014 for the two states.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The author has found that the difference between the average interest rate of Andhra Pradesh and Madhya Pradesh is significant for both pre-treatment and post-treatment periods and this gap has increased after the intervention period. The results suggest that the share of informal sector borrowings has reduced in the treatment group (Madhya Pradesh) as compared to the control group (Andhra Pradesh) in the post-treatment period.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This paper is particularly important because of the dearth of literature on the impact of this scheme in India and may shed light on the much-needed policy implications of this particular policy.</p><!--/ Abstract__block -->","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"618 ","pages":""},"PeriodicalIF":1.6,"publicationDate":"2023-11-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138518978","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Impact of financial literacy and financial confidence on the savings behaviour of the farmers: the Indian scene","authors":"Soumyadwip Das, Sumit Kumar Maji","doi":"10.1108/afr-05-2023-0056","DOIUrl":"https://doi.org/10.1108/afr-05-2023-0056","url":null,"abstract":"Purpose The study aims to explore the savings behaviour of Indian farmers. An attempt is also made to inspect the effect of financial literacy (FL) and financial confidence (FC) on the savings behaviour of the farmers in India. Design/methodology/approach This study used secondary data on 10,263 Indian farmers from Financial Inclusion Insights, 2017 database. Relevant statistical techniques and ordered probit regression were used to unfold the effect of FL and FC on the savings behaviour of farmers. Findings The outcome of the study revealed that the majority of the Indian farmers exhibited poor levels of FL and FC. Of the total, 42.99% were found to save regularly. FL and FC were observed to play instrumental roles in steering the savings behaviour of the Indian farmers. Household size, financial shocks, gender, farm ownership, income, household financial decision-making process, religion and educational attainment have emerged to be significant predictors of the savings behaviour of Indian farmers. Originality/value The present study makes an original contribution to the extant literature by unfolding the savings behaviour of Indian farmers and the effect of FL and FC on such behaviour using a rich sample of 10,263 farmers for the first time.","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"4 5","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-11-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136227899","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Remittances and agricultural productivity: the effect of heterogeneity in economic activity of farming households in Ghana","authors":"Mark Eghan, Charles Adjasi","doi":"10.1108/afr-03-2023-0043","DOIUrl":"https://doi.org/10.1108/afr-03-2023-0043","url":null,"abstract":"Purpose This paper aims to test the impact of remittances receipt on agricultural productivity. The paper empirically assesses whether heterogeneity in economic activity of farming households affects the effects of remittances on productivity of tradable and nontradable crop farming households in Ghana. Design/methodology/approach The authors employ propensity score matching (PSM) methods to address potential endogeneity issues that could arise from the estimation due to selection bias. This paper uses the seventh round of Ghana living standard survey dataset for Ghana. Findings The authors find that, the involvement of farming households in other economic activities alters the impact of remittances on crop yield. This differential impact also varies according whether the crop is tradeable or not. Practical implications Policy can reduce the cost of sending remittances and include financial literacy modules in the farmer training modules to increase farmers' knowledge on investment of remittance in agricultural production. Originality/value The authors distinguish the paper from others by controlling for crop types (particularly tradeable or otherwise and gestation period), farming of a second or more crops and engagement of smallholder farmers in nonfarm economic activities.","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"5 12","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-11-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136229279","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Agricultural value chain participation and farmers' access to credit in northern Ghana","authors":"Timothy Anakwa Osei, Samuel A. Donkoh, Isaac Gershon Kodwo Ansah, Joseph A. Awuni, Mensah Tawiah Cobbinah","doi":"10.1108/afr-01-2023-0007","DOIUrl":"https://doi.org/10.1108/afr-01-2023-0007","url":null,"abstract":"Purpose Promoted for its inclusivity, agricultural value chain (AVC) financing leverages social capital and mechanisms such as off-take agreements and forward contracts to reduce borrowing and lending costs and risks for both farmers and lending institutions. AVC financing has been defined as the flow of financial products and services to and among the various actors within the AVC to address constraints of production and distribution and fulfill the needs of those involved in the chain by reducing risk and improving efficiency. This paper investigates how farmers' involvement in AVC affects their access to credit. Design/methodology/approach The authors collected primary data from 400 crop farmers in northern Ghana through a semi-structured questionnaire and analyzed the data, using the multinomial endogenous switching regression model. Findings Joint participation in AVC increased the amount of formal and informal credit received by 64 and 78%, respectively, compared to nonparticipation. Similarly, participation in AVC horizontal linkage and AVC vertical linkage increased the amount of formal and informal credit received by 40 and 47% and 46 and 74%, respectively, compared to nonparticipation. Irrigation farming, extension visits, knowledge of AVC in the community, access to a storage facility and trust in contract farming significantly influenced farmers' participation in AVC. Originality/value The authors’ work offers valuable insights into how different dimensions of value chain participation can impact smallholder farmers' access to credit. This work also underscores the importance of considering both formal and informal credit sources when analyzing the outcomes of value chain participation. The findings could enable formal financial providers to identify, liaise and/or resource informal financial players such as value chain actors to supply both formal and informal credit to farmers in AVCs.","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"23 8","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-11-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135091400","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Regulation and agriculture financing in Kenya","authors":"Kellen Murungi, Abdul Latif Alhassan, Bomikazi Zeka","doi":"10.1108/afr-10-2022-0130","DOIUrl":"https://doi.org/10.1108/afr-10-2022-0130","url":null,"abstract":"Purpose The agricultural sector remains the backbone of several emerging economies, including Kenya, where it contributes 34% to its gross domestic product (GDP). However, access to financing for agricultural activities appears to be very low compared to developed economies. Following this, governments in a number of countries have sought to introduce banking sector regulations to facilitate increased funding to the agricultural sector. Taking motivation of the interest rate capping regulations by the Central Bank of Kenya (CBK) in 2016, this paper examined the effect of these interest rate ceiling regulations on agri-lending in Kenya. Design/methodology/approach The paper employs random effects technique to estimate a panel data of 26 commercial banks in Kenya from 2014 to 2018 using the ratio of loans to agricultural sector to gross loans and the natural logarithm of loans to agricultural sector as proxies for agri-lending. Bank size, equity, asset quality, liquidity, revenue concentration and bank concentration are employed as control variables. Findings The results of the panel regression estimations show that the introduction of the interest cap resulted in increases in the proportion and growth in agri-lending compared with the pre-interest cap period. In addition, large banks and highly capitalised banks were found to be associated with lower agri-lending, with differences in the effects across pre-cap and post-cap periods. Practical implications From a policy perspective, the findings highlight the effectiveness of interest rate capping in meeting this objective and supports the calls for strengthening cooperation between the government and key stakeholders in the financial sector. This will allow for the effective enforcement of policies by the regulatory powers in a manner that guarantees sound and dynamic financial systems, particularly within the agricultural sector. Originality/value As far as the authors are aware, this the first paper to examine the effect of the interest rate cap regulation on agri-lending in Kenya.","PeriodicalId":46748,"journal":{"name":"Agricultural Finance Review","volume":"118 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136254882","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}