Ag Credit Survey: Farm Economy Rebounds Sharply
The agriculture economy rebounded in the fourth quarter of 2020, according to the latest Ag Credit Survey from the Kansas City Federal Reserve Bank. The average price of grains increased more than 20 percent from the previous quarter and reached six-year highs in December. Livestock prices, while still less than a year ago, also improved from lows reached earlier in the year. Government payments provided broad support through the year, and, together with recent price increases, the near-term outlook for the farm sector improved dramatically. The survey represents conditions in the Federal Reserve’s Tenth District, including Colorado, Missouri, Kansas, Nebraska, New Mexico, Oklahoma and Wyoming. A majority of bankers in the District indicated that farm income was higher than a year ago for the first time in eight years, boosting liquidity and loan repayment capacity and providing renewed support for farm real estate. Overall, agricultural conditions in the first quarter of 2021 in the Kansas City Fed region were poised to remain strong for the first time since 2013.