Ag lending in a covid world

The coronavirus pandemic has forced many ag financial operations to slow down or stop altogether. Appraisers may not be able to travel, and some insurance companies are unable to write policies and get them signed by customers to prevent spreading the virus. But there is a silver lining. These institutions are modernizing their processes and becoming creative so customers can move forward without person-to-person contact.

Paul Erickson is the president and CEO of Conterra Ag Capital. He predicts one positive outcome will be how documents are signed.

"And that is forcing certain states to make sure their legislation allows electronic signatures on the actual loan docs," says Erickson. "Some states require a wet signature, some don't, but what we're seeing across the U.S. is that I think it's going to move pretty quickly to be able to operate on all legal documents with an electronic signature."

Physical farmland appraisals have been disrupted by limited travel and personal contact. He says some appraisals are conducted from drones and satellites.

"It works extremely well for bare farm ground. And when a cornfield is growing and you're doing an appraisal and you're walking or driving around the perimeter of the field and saying, well, yeah, it's there, it looks good," he says. "But, with whatever type of photographic image you can actually see there may be abandoned farmsteads or stuff in the middle of the field that you normally wouldn't see."