KC Fed reports sharp increase in agricultural borrowing
Building on a sharp increase in loan volumes in the first quarter of 2014, commercial bank lending to the agricultural sector continued to climb amid a more intense need for short-term financing of production expenses, according to the Federal Reserve System's Agricultural Finance Databook.
In the second quarter, record high prices for feeder livestock boosted lending to the livestock sector but loan repayment rates should be bolstered by improved profitability for cattle and hog producers.
In contrast, narrower profit margins for crop farmers have prompted additional borrowing to pay for operating costs. Although crop insurance may offer a measure of revenue protection in 2014, a prolonged period of low crop prices could raise concerns about increased leverage and available working capital. In addition, loan growth for purchases of farm real estate appeared to ease in the second quarter and farmland markets cooled, particularly in the Corn Belt.
See the complete issue of the Agricultural Finance Databook here for additional information on national trends in farm lending.
- What to do now in regards to the 2014 Farm Bill
- Mistakes that hurt a farm's credit
- Mycogen Seeds introduces four new sunflower hybrids for 2015
- China cuts cotton import quotas to boost demand for its own fiber
- Hog futures the exception to bearish ag market rule Monday AM
- Gangster herbicide program update
- Despite USDA approval, Enlist trait faces hurdles
- Activist investor Peltz pushes DuPont to split itself
- USDA approves Dow’s Enlist corn, soybean traits
- Study shows differences in understanding sustainable agriculture
- Mapping technology help farmers understand soil
- Vilsack urged Buffett to ready BNSF for record crops
- U.S. GMO labeling foes triple spending in first half of this year
- Activists fighting Golden Rice even more in 2014
- Source shows half of GMO research is independent
- East-West Seed signs marketing collaboration with Monsanto
- White House issues veto threat on bill to block WOTUS rule
- USDA releases 2012 cash rents data report