Fed Bank: Fertilizer, Fuel and Feed Costs Increased Loans In 2nd Quarter

July 18, 2011

You can read the full report, Federal Reserve Bank’s National Trends in Farm Lending.

Here are the high points:

  • Non-real estate ag lending jumped 14 percent due to higher costs of fuel, fertilizer and feed.
  • The increased input costs also increased the short-term amount borrowed  by 36 percent.
  • Commodity prices and 1st quarter profits continue to push land values up.
  • Corn Belt land prices jumped 20 percent above a year ago.
  • Cost of borrowing fell from 5.3 percent to 4.7 percent with average loan maturity of  less than a year.
  • Farm machinery loan volume fell 36 percent compared to a year ago.
  • Farmland values have yet to peak, which is pushing cash rent negotiations higher.


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