USDA Reports Fewer Farm Loans

The farm economy has been struggling for a few years, but it's seeing small improvements. Those improvements may be reflected in the declining demand for USDA direct and guaranteed farm loans.The USDA's Deputy Administrator for Farm Loans, Jim Radintz, said in fiscal year 2016, the USDA issued 6.3 billion dollars of new credit, dropping to 5.9 billion in fiscal year 2017, with loan money left unused.

He added there could be a couple of reasons for the slight falloff in loan demand, going back to the 2016 crop year.

"Yields were very strong, which reduced some of the need for credit in 2017. The cattle mark was maybe a little better than some had anticipated."

So what about the loan demand in the first few months of the new fiscal year?

"We're running at or slightly below 2017 levels."

Delinquency rates have been steady for several years. 5-percent for direct loans... just over one-percent for guaranteed loans.