Hoosier Banker, Panelists Talk Ag Financial Outlook
Published: Friday, October 23, 2026
Last Friday's Midwest Ag Conference at the Federal Reserve Bank of Chicago ended with a panel discussion moderated by Nathan Kauffman, senior vice president and Omaha Branch executive at the Federal Reserve Bank of Kansas City, and featuring bankers Mark Jensen and Kent Liechty, and Illinois farmer Trent Sanderson. They discussed the financial situation, outlook for Midwest agriculture and decisions being made to preserve farms in the region.
Jensen, of Omaha, Neb., is the president and CEO for Farm Credit Services of America, AgCountry Farm Credit Services, and Frontier Farm Credit. He has been with Farm Credit for 34 years and has served as the CEO for the past seven years.
Liechty, of Adams County, Ind., is the president and CEO of the First Bank of Berne. He has been in that position for 16 years, following his role as a commercial lender in the Adams County community. The First Banke of Berne encompasses six different locations in rural Indiana.
Sanderson is a farmer from Clare, Ill. who recently transitioned from a conventional farming system to an organic one with direct, farm-to-consumer marketing.
The following is a question-and-answer session between Kauffman and the three panelists, covering topics including current conditions, farm decision-making, land values, rental rates and future expectations:
Kauffman: What (have) conditions in agriculture meant and what it looks like from a financial perspective?
"Consolidation," Liechty said.
He noted that this can be seen in nearly every American business today, such as banking, furniture stores and more. He expects it will likely continue in agriculture and other industries as technologies continue to advance.
"We rotated our crop production from conventional to organic. That was the only way we could stay profitable," Sanderson said.
He also noted that since doing this in the Chicago area, his farm income has been growing in equity faster than ever before.
Kauffman: How would you characterize financial conditions from your perspective?
Liechty: "When you look at the conditions from a credit standpoint, we feel they're pretty good. Not great, but still pretty good," Liechty said. "For those who do not have a land base, that makes it very difficult if you don't have that. Equity (market value) is up, and buildup in real estate can be difficult to withstand some of these gyrations.
"Management ability becomes more important. We have some producers that are using AI tools very extensively. That can provide a significant opportunity of either agronomic or marketing financial decisions.
"Farmers with grain storage in our area have significantly benefited from ethanol plants and there have been a lot of investments. Those who don't have grain storage are at a significant disadvantage."
Jensen added to Liechty's comment, saying, "It really comes down to if you're in an area that had good yields, you did all the right things from a risk management standpoint, price and crop, if you prepaid some diesel, if you're in an area that has ethanol you're going to be at the better end of things."
Sanderson said there's a mix of conditions.
"I'm coming from an area, for context, where I'm not the only one that's switched marketplaces. In our county alone, were pushing 40,000 acres of organic production and it's continuing to grow. For those who are in commodities now, we do have some local ethanol markets that offer some premiums.
"But there's certainly operations that could be looking at whether or not they'll be in production next year, and there's the completely other end of the spectrum where that's not a thought at all."
Kauffman: How are you thinking about decisions now, either financial or productive, that you would say I'm not sure I would do this going forward or are different from a year ago?
"A lot of my decisions are data driven," Sanderson said. "I'm looking out always at 12 and 24 months based on our crop rotation because crop rotations are vital to our way of production."
He is also a seed dealer in the organic marketplace, which he said acts as an advantage, because he sees some data firsthand. As an example, he said he was able to plan for infrastructure for some grain storage based on trends he saw a couple of years ago.
Liechty responded with a question for farmers to ask themselves, stating, "Looking at the operations and based on expansion and future direction, do you have the ability to survive a bad day?
"We have operations with limited labor and the latest, greatest tech. Others are still from the 90s with lots of labor and limited technologies, but still make it work and are profitable," he said.
Therefore, any type of farming can bring profit to the farmer.
"The big question is risk management. Are you looking at your operation and managing that risk? Risk management does become, from our perspective, very, very important," he said.
The way farmers grow their crops and market each crop matters, he said.
Jensen's big question for farmers regarding their decision process is "What are you doing to preserve liquidity?"
Kauffman: What do you characterize as the primary factors that are holding up land values and where do you see this market headed over the next 6-12 months?
"So far, we really haven't seen real estate values haven't decline much at all," Jensen said. "We are starting to see some early evidence of it in Iowa. The reason I mention Iowa is oftentimes we find them to be a kind of leader up and a leader down as you start to see these trends."
He mentioned a lock on farm debt due to federal actions in recent years, which has kept debt in a pretty low capitalization rate, and that the safety net of ag risk management is up.
"That's what kept it (land values) up," he said.
Liechty echoed Jensen, saying, "Similar to what Mark was saying, when you think about real estate assets, a real estate asset has an economic value. There's also market value, which is the sale value. There's a difference between the two. Today, that gap is probably wider than what it's been in my career," Liechty said. "We are not going to see another '80s. The debt level is much, much different. The tools that we have in place to manage risks, the government programs—there's just so many things that look a lot different that's going to impact that."
He also added that most farmers will invest in land because they can see, touch and feel it. The "perceived value" of land differs from other investments, even in stocks in agricultural equipment and technology.
Sanderson said land values are holding up.
"They're not making more of it (land)," he said. "I think that plays a big role in it as well. Whether your small-time farmer like me or a big investment group, that's real. It's not the stock market; it's a real item that will forever go up in value."
Kauffman: What do you expect to see in respect to rental rates on that ground and what does that mean in terms of cost pressure? What does that mean then in connection with land values?
Liechty said the recent boost in commodity prices could be detrimental.
"The timing is not good for farmers, in my opinion, because this is the time when you're talking about rental rates. The run-up in grain prices gets people optimistic and sometime over-optimistic about what they think they can afford," he said.
He added that he expects the rental market to be robust over the coming year.
Jensen made similar comments.
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