Demand for bank loans, loan extensions and renewals is surging among U.S. farmers, and farm incomes are forecast to fall for a third year, as grain and livestock prices remain stubbornly low, according to reports from Federal Reserve Banks on Thursday.
Access to such credit tightened in the fourth quarter, and is expected to continue to be squeezed in 2016, as the rate of farmers repaying existing loans slows and the value of their land falls, according to the quarterly farm economy surveys from the Fed banks of St. Louis, Kansas City and Chicago.
The findings come as the U.S. farm economy continued a downward slide in the fourth quarter of 2015. A strong dollar, sluggish export demand and a glut of grain have kept bearish clouds over the sector and dragged down wheat prices to nearly six-year lows.
Source: Credit demand rises in U.S. farm economy as incomes fall| Reuters