
Agricultural News
Kansas City Fed Ag Credit Survey Reveals that Lower Income Continues to Pressure Farm Finances
Thu, 15 Nov 2018 17:12:26 CST
Farm income and credit conditions continued to deteriorate in the third quarter of 2018, according to the Tenth District Survey of Agricultural Credit Conditions.
Heading into the fall harvest, prices for most major commodities remained lower than a year ago amid elevated supply expectations and ongoing trade disruptions. Throughout the seven states of the Tenth Federal Reserve District, more than half of bankers reported lower farm income compared to a year ago, and the decline in farm income was sharpest in states with higher concentrations in corn and soybeans.
The prolonged period of depressed farm income has placed more pressure on borrower balance sheets. According to bankers across the District, a majority of crop producers in 2018 had a modest deterioration in working capital. For the fifth straight year, a majority of bankers reported having borrowers with some depletion of short-term operating funds. Stress on farm finances also contributed to an increase in the expected sale of mid- to long-term assets in 2018.
Farmland values remained stable and continued to support agricultural credit conditions. However, lower farm income and reduced liquidity could weigh on farmland values in future quarters.
Read the complete Agricultural Credit Survey at www.kansascityfed.org/research/indicatorsdata/agcreditsurvey.
Source - Federal Reserve Bank of Kansas City
WebReadyTM Powered by WireReady® NSI
Top Agricultural News
More Headlines...
