The Farm Credit Administration board today received a quarterly report on the Farm Credit System (System) and a semiannual report on FCA's examination activities.
According to the report, the operating environment remains challenging for many agricultural sectors. Farm debt levels remain high while net cash farm income is declining. Interest rates, while still low, have begun to increase.
Also, with USDA forecasting record or near-record corn, soybean, and wheat production, crop prices are expected to remain weak.
These factors continue to put downward pressure on Midwest farmland values. High production levels are also weighing on pricing and profit margins in the protein and dairy sectors.
Overall, the System is safe and financially sound, and System institutions are well-positioned for the challenging risk environment facing agriculture.
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