Report highlights improving farm credit system

New data speaks to the improving health of the farm credit system.

In its latest quarterly report ending December 31st, the Farm Credit Administration found that a nearly 10 percent increase in loan volume contributed to stronger earnings and better margins.

FCA chairman Glen Smith tells Brownfield that’s significant because the farm credit system is a cooperative.

“Most of those profits go back in the farmers’ hands in the form of patronage, and many of those (farm credit) institutions had record patronage years.”

He says farm credit cooperatives and its members should feel good about 2020 and consider taking advantage of higher commodity prices.

“Because as we well know ag runs in very dynamic cycles, and it may not last.”

Smith says there remain opportunities to refinance with historically low interest rates, and to shore up cash flow. 

The FCA report says while most credit measures improved compared to the previous year, risk remains elevated for certain agricultural sectors and geographical regions.

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