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Maura Bennett Ag Outlook Forum
by Maura Bennett, click here for bio

Program: Colorado Ag Today
Date: February 22, 2019

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Farmers this year and for several years could face continued low commodity prices and rising debt loads.

Agriculture Department Chief Economist Rob Johansson gave the bad news to the Ag Outlook Forum in Virginia

Johanson says 2018 net farm income was 66 billion dollars.

“That’s a long way from the 134 billion we saw back in 2013. Today total debt is approaching record levels in real terms and real estate debt reached a record high last year. Low commodity prices will weigh on farm income and is likely to cause cash flow problems to producers without significant land equity.”

Johansson added the national rate of producer bankruptcies is up, at 2.25 per 10,000 farms.

While rising bankruptcies aren’t a positive development, they are low historically, and should be viewed in context, he said the overall figure is 10 times lower than in the 1980s, he said.

Johansson says the most important issue this year will be China’s retaliatory tariffs that essentially blocked US soybean exports to China, forcing sale of the oilseed at steep discounts relative to main competitor Brazil. Alternate markets are increasing, Johansson said, but not nearly enough to offset the loss of exports to China.

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