News

Ag economist sees some bright spots in ag economy

Good news about the ag economy is harder to find these days. But an ag economist with Farmer Mac—the Federal Agricultural Mortgage Corporation—says the news is not all bad either.

Jackson Takach says, from a lender’s perspective, there are some bright spots.

“Borrowers are paying as agreed. Delinquency rates are still very, very low,” Takach says. “So that tells you something about about their (farmers) ability to withstand low commodity prices and lower incomes.”

Takach says most farmers prepared for the economic downturn by building a good base of working capital.

“One of the things they did leading up to this was, a) not over-leverage, and b) they saved a lot of their cash into working capital and inventory so they could liquidate it in a down cycle,” he says.

Takach says commodity prices may struggle again in 2016, but he thinks a turnaround could come as soon as 2017.

AUDIO: Jackson Takach