NASHVILLE, TENN. (RFD NEWS) — Farm operating debt remains mostly stable across the South, but late-loan categories are showing pressure after a difficult year for row-crop margins. Charley Martinez with the University of Tennessee Institute of Agriculture says non-real estate farm loans were 4 percent higher in the fourth quarter of 2025 than a year earlier.
The biggest concern is loan quality. Martinez says non-accrual loans stayed elevated from the previous quarter and were 172 percent higher than in the fourth quarter of 2024. Loans 90 days or more past due were nearly unchanged from a year earlier.
Loans 30 to 89 days late fell from their first-quarter peak, but Martinez says some of that debt likely moved into the non-accrual category by year-end. That category still remained 35 percent higher than fourth-quarter 2024.
State pressure varied. Alabama, Georgia, Louisiana, Mississippi, and Arkansas were above the regional average for total late debt as a share of total loan volume.
Higher crop prices and future ARC and PLC payments may help, but input costs, interest rates, and tight margins keep working capital important.
Farm-Level Takeaway: Operating debt remains manageable in many areas, but rising non-accrual loans show why careful cash-flow management matters in 2026.
Tony St. James, RFD News Markets Specialist
Cotton margins improved slightly, even as fertilizer and fuel costs rose due to the Strait of Hormuz disruption linked to the Iran war.
The latest developments point to shifting export routes, higher congestion risk, and continuing cost pressure for grain, fertilizer, and energy shipments.
USDA Chief Economist Justin Benavidez says the cattle industry may be nearing a turning point that could gradually reshape supply, prices, and profitability in the years ahead.
Purdue University’s Dr. Michael Langemeier joins us to break down the latest read on farmer sentiment in the April Ag Economy Barometer, and growing concerns about the impact of global conflict on farm inputs and income.
Higher freight rates and potential service disruptions are key concerns for agriculture, which relies heavily on rail to move commodities.
Growth Energy CEO Emily Skor joins us to discuss the uncertain path for year-round E15 sales and the next steps as the issue heads toward a standalone House vote after it was stripped from the Farm Bill.
