Agriculture Credit Condition

Dallas Tonsager, chairman and CEO of the Farm Credit Administration, said agriculture faces stiff headwinds from lower commodity prices, falling net-farm incomes and trade concerns. There are a number of factors supporting the overall good condition of Farm Credit Services. That includes stable earnings, a strong capital base and reliable access to debt capital markets, he said. As of Sept. 30, 2018, FCS gross loans totaled $263.6 billion, an increase of $12.5 billion or 5% from Sept. 30, 2017, Tonsager said. Real estate mortgage lending was up $5.7 billion or 4.8% as demand for cropland continued in 2018. Overall, real estate mortgage loans represent almost 47% of the system's loan portfolio. Production and intermediate-term lending increased by $1.4 billion or 2.7% from the year before, Tonsager said, and agribusiness lending for processing and marketing increased by $2.7 billion or 12.8%. "The system also continues to benefit from a strong capital base, which enhances its risk-bearing capacity at a time when system borrowers in certain agricultural sectors face increasing financial stress," he said.