While economic margins have farmers analyzing every dollar, simultaneously, financing options have expanded. New analysis shows timing and financing program choice may save farmers $5 an acre in cost of credit.
The team at The University of Missouri Rural and Farm Finance Policy Analysis Center (RaFF) reviewed 21 seed vendor financing programs.
If farmers finance corn seed through the vendor, their analysis compares the cost of credit of vendor programs and traditional bank operating loans.
While traditional bank operating loans provide a majority of agricultural credit, citing their previous estimates RaFF, vendor financing in agriculture inputs has surged to $40 billion annually. Nutrien, the largest ag retail network in the U.S., eyes growth via offering its financing offer via the Nutrien Hub, its online portal for farmers and its retail network.
The question being asked is if vendor financing options offer an economic advantage based on early-pay incentives.
This down-to-the-dollar analysis is important as the USDA-ERS forecasts corn production costs to be over $916/acre and the average price at $4.20/bu. Farmers are scrutinizing every dollar spent on their crops for 2026.
So what did the analysis find?
For both bank operating loans and vendor supplied financing, the analysis assumed the full borrowed amounts would be due in December 2026.
For the vendor financing, the scenario considers the advertised interest rate plus the associated early-pay incentives, which for the 2026 growing season began Aug. 31, 2025.
For the bank operating loan, the analysis used an 8.07% interest rate, which was sourced from the ag lending survey from Federal Reserve Bank of Kansas City.
The big takeaway is the earlier the seed order, the more savings experienced—regardless of credit source. In the earliest time frame for orders, the vendor financing gave a slight advantage—a little more than $5 per acre.
The analysis also shows financing having an advantage over cash discounts.