Farm Credit Outlook Shows Prices for Grains to Strengthen

According to a  new report presented to the Farm Credit Administration, profit margins for farmers nationwide  are expected to increase in the coming months, led by corn and soybean growers.  The report shows profit margins are expected to decline for livestock producers though, as rising grain prices drive up feed costs, and Southwest pasture conditions deteriorate because of severe drought.

The quarterly report also notes that uncertainties regarding agricultural trade policy and the Farm Bill will have a direct bearing on the farm economy.  The outlook says producers across the farm economy will face stress on cash flows from rising interest rates and higher fuel costs, and declining cash rents will put downward pressure on farmland values.  Meanwhile, for the first quarter of 2018, the Farm Credit System reported strong earnings, higher capital levels, and a favorable portfolio credit quality.

Overall, The Farm Credit Admiration considers the system as financially strong and says it “remains safe and sound.”​

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