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Ag credit deterioration concerning

A policy advisor at the Federal Reserve Bank of Chicago says there are concerns over the amount of credit deterioration occurring in the ag sector.

David Oppedahl says low commodity prices and high input costs continued to plague agriculture in the first quarter of 2025.

“There is an increase in demand for non-real estate loans.”  He says, “There were some additional renewals and extensions on loans from last year, and lower repayment rate.”

He tells Brownfield a recent survey of Seventh District bankers shows the trend is expected to continue.

“The bankers expected non-real estate loans were continuing to show some upward momentum, but the other kinds of loans, and especially real estate loans, were expected to be a little weaker in this quarter,” he says.

Oppedahl says one economic bright spot for farmers is the slumping ag economy brought cash rents in the region down 2% from 2024.

The Seventh Federal Reserve District covers portions of Illinois, Indiana, Iowa, Michigan, and Wisconsin.

AUDIO: David Oppedahl – Federal Reserve Bank of Chicago