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KC FED: AGRICULTURAL CREDIT CONDITION CONTINUES TO WEAKEN
May 18, 2015
Source: Kansas City Federal Reserve Bank
Credit conditions in the Federal Reserve's Tenth District weakened as farm income declined further in the first quarter of 2015.
Persistently low crop prices and high input costs reduced profit margins and increased concerns about future loan repayment capacity.
Funds were available to meet historically high loan demand, but loan repayment rates dropped considerably.
Although profit margins in the livestock industry have remained stable, most bankers do not expect farm income or credit conditions to improve in the next three months.
Reduced incomes in the crop sector trimmed the value of nonirrigated and irrigated cropland, but steady profitability in the cattle sector supported higher prices for ranchland.
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