Bank survey shows livestock operators rebuilding

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bank Livestock operators are ready to expand business with commercial bank loans for livestock purchases rising to record levels not seen almost a decade.

The bank lending rates for the first quarter of 2013 were calculated by the Federal Reserve System's Agricultural Finance Databook.

Lower expected feed costs resulting in improved profit margins this year give producers a renewed interest in the livestock industry. The survey also showed loan volumes for operating expenses continued higher in 2013 after a strong fourth quarter of 2012.

According to the report by the Federal Reserve Bank of Kansas City, high feeder cattle prices kept loan volumes to cattle feedlots elevated.

The number of non-real estate farm loans in the first three months of the year increased by nine percent. A dramatic increase in the number of loans to purchase livestock was seen in January and February. As seen in the chart, loans for operating expenses, feeder livestock and other livestock experienced notable increases while equipment loans declined.

Loans for other areas of agriculture are also positive. Even with land selling for record prices the report shows a flurry of farmland sales at the end of 2012 have advanced modestly at the beginning of the new year.

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May, 03, 2013 at 09:24 AM

You are likely reading this wrong, much of this loan volume is likely due to high feed costs and trying to maintain numbers rather than expand.

terry bunch    
calhoun ga  |  May, 06, 2013 at 01:53 PM

I think you are right.The increase in prices of all expenses would make these numbers look like expansion.


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