Strength in the US agricultural economy continues to drive improvement in farm income and credit conditions.
Bankers in the Kansas City Federal Reserve Districts report additional increases in farm income and farm loan repayments rates and a decrease in demand for loans. However, profit opportunities in the cattle industry remained more limited than other major commodities. The ongoing drought has also created concerns for some producers. With support from stronger farm finances and historically low interest rates, farmland values increased by at least 10% in almost all states in the district.
The outlook for farm finances in 2021 remained strong, based on recent reports across the Federal Reserve Districts. In the Kansas City, Minneapolis and St. Louis Districts, the majority of bankers said income was higher than the same time last year, with less than 10% reporting a drop in incomes.
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