CHICAGO, IL (RFD NEWS) — Midwest farm credit conditions weakened in the first quarter as producers carried more operating debt and lenders reported slower repayment rates.
The Chicago Federal Reserve says non-real-estate farm loan demand rose for the tenth consecutive quarter across the Seventh District.
The loan demand index reached 141, with half of responding lenders reporting higher demand than a year earlier. At the same time, repayment rates remained weak, with 38 percent of lenders reporting lower repayment rates and only 1 percent reporting improvement.
Loan renewals and extensions also increased. The index reached 136, its highest level since the second quarter of 2020, and lenders reported an average of 17 percent of farm borrowers carried more debt into 2026.
Farmland values were still 3 percent higher than a year earlier, but dipped 1 percent from the previous quarter. Cash rents fell 3 percent for 2026, their second straight annual decline.
The outlook points to increased demand for operating, feeder cattle, and FSA-guaranteed loans this spring.
Farm-Level Takeaway: Higher loan demand, weaker repayment rates, and more carryover debt show working capital remains under pressure.
Tony St. James, RFD News Markets Specialist
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