Loan volumes for almost all farming purposes rose at commercial banks, as many producers contended with tighter profit margins, according to the April 2015 edition of the Agricultural Finance Databook from the Federal Reserve Bank of Kansas City.
A year ago at this time, Ag Equipment Intelligence reported that commercial bank lending for non-real estate farm loans dipped in the fourth quarter, driven in large part by a decline in farm capital spending.
Short-term financing for ongoing production needs appears to be further restraining medium-term borrowing for capital investments, like equipment and grain storage, according to the third-quarter edition of the Agricultural Finance Databook from the Federal Reserve Bank of Kansas City.
If 2013 farm production costs rise at the rates seen last year, U.S. farmers will need to take on more debt, which could curb spending on farm equipment in 2014. The Federal Reserve Bank of Kansas City reported in its July Agricultural Finance Databook newsletter that rising production costs prompted some agricultural producers to take on more debt.
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In this episode of On the Record, brought to you by Associated Equipment Distributors, Deere Director of Investor Relations Josh Beal told JP Morgan analysts that the OEM is confident it will be “producing to demand” in fiscal year 2025.