(KANSAS CITY, MO) — Economic conditions in the Tenth District farm economy weakened in early April as overall economic activity in the district grew slightly, that according to the new Beige Book update from the Kansas City Fed.
In the latest survey of agricultural credit conditions, lenders reported gradual deterioration in farm loan repayment rates and notable increases in carryover debt and loan restructuring compared to a year ago. Credit conditions weakened comparatively more in portions of the District most heavily concentrated in crop production while strong cattle prices supported farm finances in other areas.
Production costs, elevated living expenses, and further declines in working capital were cited as key concerns, with some contacts noting that more highly leveraged borrowers were selling longer-term assets to improve liquidity. Also, as prices for several key commodities declined along with increased uncertainty with export prospects, that added to limited profit opportunities for crop producers reflected in the latest survery.
Overall economic activity in the Tenth District did grow slightly, but expectations about business activity and consumer spending weakened considerably compared to the last report.
Read more here: https://www.kansascityfed.org/surveys/beige-book/tenth-district-beige-book/
SOURCE: Kansas City Fed
