KANSAS CITY, Mo. (RFD-TV) — Agricultural credit conditions across the Tenth District weakened again in the third quarter as crop producers faced another season of tight margins, elevated input costs, and shrinking working capital.
According to the Federal Reserve’s regional survey, lenders in crop-heavy states such as Kansas, Nebraska, and Missouri reported lower farm income and softer repayment rates, with as many as 40% noting declines. Mountain States lenders also reported weaker finances tied to low wheat and dairy prices. By contrast, cattle-dependent regions like Oklahoma saw stronger incomes, improved repayment expectations, and steadier loan quality as record cattle prices continued to bolster revenues.
Despite the financial strain, loan demand climbed, driven by producers seeking operating credit to bridge weak margins. More lenders indicated borrowers plan to sell equipment or other assets to improve liquidity, and problem loan rates nudged higher in crop-focused areas.
Fund availability held mostly stable, while interest rates eased slightly from the previous quarter but remained well above long-term norms. Farmland markets remained surprisingly steady: cropland values held firm, ranchland rose about three percent, and cash rents followed similar patterns.
Looking ahead, lenders expect continued stress for crop operations but relative stability for livestock. Many anticipate lower repayment capacity through winter, stronger non-real-estate loan demand, and a moderate rise in forced asset sales if commodity prices do not improve.
Farm-Level Takeaway: Crop producers face tightening credit and lower incomes, while strong cattle markets continue to stabilize finances in livestock-heavy regions.
Tony St. James, RFD-TV Markets Specialist
November 26, 2025 11:27 AM
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