News

St. Louis Fed bankers see further slide

Ag bankers surveyed in the St. Louis Federal Reserve District report continuing declines in farm income and land values in the first quarter of this year, compared with year ago.

A Missouri banker surveyed said lower grain prices are finally changing the psychological mindset for producers” adding that “most are not able to lower operating expenses significantly and are looking at troublesome cash flow projections.”

Bankers reported a two-and-a-half percent decline in quality farmland values.  The value of ranchland slid more than 1-and-a-half percent. While they expect farmland values to further decline they expect ranch and pastureland values to go up.

Loan demand in the first quarter was higher than bankers expected at the start of this year.

Nearly 70 percent of the bankers surveyed expect less than one percent of farmers might walk away from committed farm leases.

The St. Louis Fed district includes the eastern half of Missouri, western Tennessee, portions of Illinois, Indiana, Kentucky and Mississippi and the state of Arkansas.

The bankers were surveyed in the last two weeks of March.