Though Ag Conditions Weaken, Rural Areas Remain Optimistic

DALLAS, TX – Bankers responding to the third-quarter survey reported overall weaker conditions across most regions of the Eleventh Federal Reserve District in Dallas. According to the survey, lenders noted that drought conditions along with low commodity prices continue to have producers concerned about 2020. Some regions have seen an influx of people interested in moving to rural areas from larger cities, which has benefited land prices. Demand for agricultural loans continued to decline, with the loan demand index registering its 20th quarter in negative territory. Loan renewals or extensions increased this past quarter while the rate of loan repayment continued to decline. Loan volume decreased across all major categories compared with a year ago. Irrigated and ranchland values fell, while dryland values increased. The anticipated trend in farmland values index grew in the third quarter, suggesting respondents expect farmland values to increase. The credit standards also increased, indicating further tightening of standards on net.
(SOURCE: All Ag News)