Farm Credit System Could Be Stressed

Lower commodity prices and falling farm incomes could put a lot of stress on the farm credit system.

At a recent Senate Ag Committee hearing, Farm Credit Adminstration Chairman Ken Spearman said lenders are ready.

“The system is well positioned; strong capital position, strong liquidity position, strong earnings.”

Senate Ag Committee Chairman Pat Roberts said the bleak economic picture for farmers will mean that access to affordable credit in rural America is critical.

Farm Credit Administration board member Jeffrey Hall said he sees similarities to the 1980s crisis, but doesn’t expect things to get as bad.

“Farmers have paid down debt coming into this current period and I think with lower interest rates, they’re going to be able to work their way through it.”

Though Hall noted there is greater volatility and challenges to the system.