Defying Expectations: Farm Loan Delinquency Rates Decrease in the Face of Agricultural Struggles

According to the April RMI survey, the latest Rural Mainstreet Index has fallen below growth neutral for the eighth consecutive month. Creighton University economist Ernie Goss explained that the agricultural sector is currently struggling, which is reflected in the survey results. The index is a monthly survey of agricultural bankers in 10 states, including Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, and South Dakota.

Despite the challenges faced by farmers due to low commodity prices and farm income, the April report revealed a surprise – farm loan delinquency rates are decreasing instead of increasing. Goss explained that farmers are still able to repay their loans on time, even in the current economic climate. However, farm equipment sales continue to decline, with farmers hesitant to make purchases due to higher interest rates and uncertainty surrounding agricultural commodity prices.

The survey also showed that farmland prices have been increasing for the 53rd consecutive month. Goss highlighted the ongoing struggles in the agricultural sector and the impact it is having on rural economies. The findings of the April RMI survey paint a picture of a challenging environment for farmers and agricultural businesses in the surveyed states.