Despite the preponderance of farm animal jokes, the American Bankers Association's National Agricultural Bankers Conference was serious business for the 500 or so attendees.

Risk management dominated the three-day event. Changes in federal farm policy and the rise of new competition, new technology and new farm marketing techniques are creating an entirely new world in which many rural bankers will do business.

"Bankers really come here to learn," said John Blanchfield, associate director for agriculture issues at the ABA. "Right now there is a lot to learn."

If there was one overriding theme to the conference, it was that the bankers who finance the majority of food production in this country are scared of a future without government subsidies while eager to take part in what could some argue could be the golden age of farming.

"You could see a new wave of affluence take hold in rural America, said Dennis T. Avery, director of the Center for Global Food Issues at the Hudson Institute. Mr. Avery told bankers that now that price supports are being phased out - and as long as trade barriers fall between the United States and Asia - an export boom to the Far East's exploding population could mean big profits for American Agriculture.

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Perhaps the biggest proof that agriculture in the United States is a growth industry is the growing numbers of nonbanks being formed to finance it.

The members of a panel representing nonbank farm financing companies told bankers that though such firms are positioned to give food producers more choices for everything from production to equipment financing, they will likely have to work with banks to expand their business.

"We believe collaboration with agriculture banks is the way to the future," said G. Michael Reed, director of PHI Financial Services, a Johnston, Iowa, unit of the Pioneer seed production conglomerate.

PHI and John Deere Credit recently formed a joint venture to make farm operating loans - a type of credit historically the sole purview of banks. But while both companies rate high on farm bankers lists of worrisome nonbank competitors, Mr. Reed said he wants to work with banks.

He said seven midwestern banks are working with Pioneer sales representatives to make seed loans, a type of cooperation Mr. Reed said PHI will need to get bigger itself. At the same time, those types of joint- financings will help banks hold onto market share.

Neil Stadlman, vice president of credit administration at another up- and-coming nonbank farm financer, Ag Services of America Inc. in Cedar Falls, Iowa, said he wants to keep his staff small while increasing his volume. For that, he needs banks.

"It's a big market out there," he said. "We have a very small piece of it right now."

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Though the vast majority of agriculture lenders are community banks, a growing number of regional banks are beefing up their farm lending efforts. Bank of America recently opened a Midwest agriculture finance division in Chicago.

Members of a panel of bankers from regional banks were surprised at how many people listened in on their packed session to discuss big bank strategies.

"I had no idea so many community banks would be interested in what we're doing," said Martha Carpenter Smith, senior vice president and manager of the agribusiness department at Boatmen's First National Bank in Kansas City.

Ms. Smith and bankers from California's Sanwa Bank and Minnesota's Norwest Corp. all talked much like community bankers, each stressing that agricultural lending deeply depends on a large bank's ability to put experienced, relationship-oriented lenders in front of the customer.

"In a large bank, our credibility with the farm customer is all that we need," said William F. Scarborough, senior vice president/group credit manager of Sanwa Bank.

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