Agricultural Survey

Quarterly comments

District bankers were asked for additional comments concerning agricultural land values and credit conditions. Some comments have been edited for grammar and clarity.

• The area has received significant rainfall which will help the grass pastures green up. Cattle prices still remain high, and commodity prices are still low. Our cattle guys are still making good money, but our farmers are getting by.

• Recent rains revived struggling wheat crops, but yields remain below average. With both production and market prices lower, wheat farmers face a tough year financially with little to no profit expected. On the other hand, cow-calf producers—many of whom also grow wheat—are benefiting from record-high cattle prices, providing a much-needed boost to their overall earnings.
• The area has had adequate moisture to plant. Low commodity prices have strained cash flow projections. Area producers are carrying debt over from the 2024 production year because of the combination of low commodity prices and drought. High cattle prices have dampened purchases for summer pasture.

• Wheat harvest is 60 percent complete. Yields and prices are better than initially expected. Cotton planting has started. Recent rains have improved conditions. The cattle market continues to be very strong.

• Ag real estate values have escalated in the past three to four years. 

• We need water, rain.
• Weaker row crop commodity prices are a point of concern. Recent rains provide hope for increased yields to offset elevated input costs and weaker prices. We are monitoring farm operators more closely this season. Prices for cattle still remain strong, and demand for loans in this category has increased.

• Cow-calf operators are enjoying good prices for their livestock, but the stocker-feeder borrowers are having trouble making purchases work. The threat of a screwworm outbreak is on everyone's mind, as it would be disastrous to the cattle and wildlife operators. Recent rains have improved pastures and attitudes.
• Recent rains have been a blessing and a curse. It’s a blessing for our livestock producers who needed the rain and a mixed bag for our row crops. Where the fields got drained, timely crops are looking good. Overall, crops that will be taken to harvest look good. The crops that were lost to heavy rains were either replanted or left fallow; the crops will be late. Not much cotton was planted, and about half of what was planted was lost. Commodity prices are a concern with the exception of livestock. High input costs are squeezing producers’ margins.

• The current alfalfa crop season is underway with the first cutting in the barn and the second beginning. Hay prices are 20 percent to 30 percent less than this time last year. Cattle markets continue to be very good. Range conditions are poor, with spotty areas of improvement where they received some spring rain. With the higher prices received on cattle, ranchers are able to buy supplemental feed for longer periods than typical, which is positive in terms of herd stability.

Historical data

Historical data can be downloaded dating back to first quarter 2000.

• Land Values
• Cash Rents
• Farm Lending Indexes
• Loan Volume Indexes by Loan Type
• Anticipated Farmland Values and Credit Standards
• Interest Rates by Loan Type

Charts

What changes occurred in non-real-estate farm loans at your bank in the past three months compared with a year earlier?

What changes occurred in the volume of farm loans made by your bank in the past three months compared with a year earlier?

What trend in farmland values do you expect in your area in the next three months?

What change occurred in credit standards for agricultural loans at your bank in the past three months compared with a year earlier?

Tables

Special Questions

For this survey, respondents were asked supplemental questions about the impact of tariffs and trade policy. Data were collected June 3–8, and 48 agricultural bankers responded to the survey.

NOTE: 47 responses.

• Net farm income will likely to be impacted by pecan, cotton and possibly beef exports. Loan demand is soft for well-managed ag enterprises.
• There hasn't been enough time since higher tariffs were implemented to give an accurate analysis.
• Farms are concerned about this, but it is still unclear how severely the tariffs will affect their bottom line.
• New poultry production is improving our market.
• Cattle prices have increased substantially recently. Loan demand is stable. 
• Ag loan demand has been down some; it is hard to say at this time if this is due to the tariffs, but I'd be surprised if they are not playing a role.
• High interest rates have caused a slowdown in loan demand.
• We are discussing with our borrowers, but no change has been seen as of yet. The harvest for corn will begin in the later part of this month, and we'll see if there is an impact to the commodity price.
• Too soon to see an impact.
• Not enough time for tariffs to take effect.

NOTES: 48 responses.

• We anticipate continued pressure on all commodity markets related to exports. On the other hand, import tariffs on commodities may positively impact demand for American ag products.
• There hasn't been enough time since higher tariffs were implemented to give an accurate analysis.
• Drought conditions will keep loan volume about the same, and tariffs will have little effect.
• Poultry production is presently increasing in this market.
• The tariffs will hurt in the short term but will improve everything in this country in the long term.
• Overall, I believe tariffs could weaken the value of local commodities and increase the cost of inputs to further shrink farm net income margins. Increased input costs will increase the dollar amount of operating lines and carryover debt to increase loan demand. Loan repayments will stall as we process through carryover debt.
• It’s too fluid at this point. Long-term tariffs should benefit [the ag industry], but there may be some pain in the short term.
• It will take over a year to see the true impacts of the tariffs.
• Higher input costs could squeeze nonfarm income.

NOTE: 45 responses.

NOTE: 45 responses.

• A very small number of our farm and ranch customers are directly impacted by tariffs on their products.
• There hasn't been enough time since higher tariffs were implemented to give an accurate analysis.
• Trade policies have little effect on our loan decisions.
• Our trade area is comprised of strong cattle operators and poultry producers with strong contracts in place. Many also have significant oil production as well.
• We always try to consider these matters as best we can.
• We are evaluating credits more thoroughly for secondary sources of repayment and overall farm equity to evaluate the sustainability of the operation if the impacts cause a carryover. Farming unavoidably carries risks outside of our control, with or without trade policy impacts.

NOTE: 46 responses.

• I think all producers are very cognizant of the uncertainty in this regard, which impacts their management decisions whether they are directly impacted by tariffs or not.
• There hasn't been enough time since higher tariffs were implemented to give an accurate analysis.
• Farmers are uncertain about the impact to them of proposed tariffs and how they will be able to market their products and for what price.
• Poultry contracts mitigate fluctuations in the market.
• It is a challenge, and all producers can't afford high-priced consultants, which still don't bat a thousand.
• Although commodity prices globally can weaken, there is still a robust domestic demand especially for grain. The verdict is still out for fiber products.

Special Questions Comments

Survey participants are given the opportunity to submit comments. Some comments have been edited for grammar and clarity.

• Still too early to tell [what the impact of tariffs will be].