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Farm Bureau economist concerned about short and long-term impact of inflation

American Farm Bureau’s chief economist is concerned about inflation limiting the ability of farmers to borrow money.  

Roger Cryan says consumer prices have risen nearly 20 percent the past four years and he expects inflation to swell another five percent in 2023.

“That’s bad enough as it is as it creates uncertainty and volatility in pricing generally. But on top of it, the Fed is trying to address that through interest rate increases. And when the Fed raises their interest rates, it raises short-term interest rates and that raises the costs of operating loans for farmers.”

Speaking to Brownfield during the MN Ag Expo in Mankato, Minnesota Thursday, he says short-term rates might double and longer-term rates are climbing, making it more difficult to borrow.

“It’s going to be a big issue. The cost of credit in the next year or two, and then the burden of debt in the years after that.”

Cryan says it will be more challenging for farmers who might need to borrow during bad times or who are looking to acquire more land.