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Agricultural credit conditions in the Tenth District remained weak at the beginning of 1999, according to a survey of 316 district agricultural bankers. Commodity prices were mixed, with crop prices falling and livestock prices rising. District farmland values edged down again and were lower than year-earlier levels. The survey suggested that farmers were exercising caution in borrowing decisions: Farm loan demand fell, the availability of funds increased, and the loan-deposit ratio fell. Loan repayment rates continued to slide.
Farmland values fall
District farmland values posted declines for the third consecutive quarter, although the declines tended to be modest. A weaker outlook for farm income dampened enthusiasm for farmland and likely contributed to the fall. Irrigated cropland values eased about 0.1 percent while nonirrigated cropland values fell roughly 0.4 percent. Ranchland values fell a moderate 0.4 percent, likely reflecting the improved picture for feeder cattle prices. Nebraska farmland again showed the greatest declines in the district, with nonirrigated cropland values falling 0.8 percent and irrigated cropland values declining 1.8 percent. Ranchland values in Nebraska dropped 1.5 percent.
After declining for the past three quarters, district farmland values are now below their year-earlier levels for the first time in three years. Nonirrigated cropland values were roughly 1 percent lower than at the same time last year, and...