By: NATHAN STUEDLE
The Farm Credit System remains financially sound, but there are additional signs of financial stress developing across agriculture. The Farm Credit Administration says higher production expenses continue putting pressure on the farm economy. Weather and geopolitical supply disruptions have created some marketing opportunities that could improve liquidity for crop producers this fall, while livestock profitability has been more varied. Farmland values, meanwhile, continue moving higher despite relatively soft farm returns in recent years.
During the first six months of 2026, the Farm Credit System reported modest loan growth, increased earnings and what regulators describe as sound capital levels. Overall loan quality also remains sound. However, nonperforming assets increased to 1.09 % of outstanding loans and other property owned as of June 30th. That's up from 1.02 % one year earlier. The Farm Credit Administration says the increase is another indication that credit risks within agriculture continue trending higher as producers deal with elevated costs and tighter margins.