The Federal Reserve Bank of Dallas yesterday issued its quarterly survey of agricultural credit conditions. Still doesn’t look that good for farmers and ranchers. Drought conditions persist, even with some recent relief. Bankers reported that loan repayment rates have fallen, and a greater percentage of them expect farmland values to drop over the next three months.
But what I found most interesting is that the bankers in North Central Texas (where we’re situated) used the most expressive language, and the most expressive punctuation (!), among any of the 13 regions of the Eleventh Federal Reserve District. Their quoted comments:
Producers are realizing that this drought, which started in May 2008 and has continued through September 2009, may rival the legendary drought of the 1950s. Cattle herd liquidation is in high gear. Crop yields are less than 50 percent of original projections, and farmers are still waiting for 2008 USDA Farm Service Agency (FSA) government disaster payments.
Ag producers are going to need disaster money!
The drought has had a devastating effect on our local farmers, causing a very poor harvest for our corn farmers. Local cattle raisers are running short on water, and the hay harvest has been very limited. Many are selling off part of their herds, with a few completely liquidating. A late freeze diminished the wheat harvest.
This area has received good rainfall, and pastures are improving. Cattle prices need to improve.
There have not been any recent land sales in the area.
Please send rain! Our farm ponds are drying up, and we have no hay in one area. Cattle are being sold as a result of these conditions.
Are things really so much worse for our local bankers and farmers? The drop in the region’s land value numbers (scroll down) may explain their extra alarm.
