May 7 - Bankers responding to a Federal Reserve Bank of Dallas quarterly agriculture survey continued to emphasize the need for rain as a great majority of the Eleventh District remained in drought conditions. Respondents to the Fed survey expressed concern for the livestock sector as ranchers faced poor pasture conditions and high feed costs. The winter wheat crop benefited from timely precipitation in parts of the district, particularly the High Plains.
Despite that drought, the survey found that agricultural land values in the first quarter were largely unchanged from fourth quarter 2012 levels. "Ranchland and dryland values were slightly below year-ago levels, while irrigated cropland values, which are on an upward trend, were 10 percent above year-ago levels," the report states. "The great majority of survey respondents expect farmland values to hold steady over the next three months.
"The farm income index posted a positive reading, indicating farmers’ and ranchers’ incomes were up this quarter compared with a year ago. Ninety percent of bankers reported no change in credit standards, while most of the remainder tightened their standards.
"Demand for loans declined more steeply this quarter, while loan repayment rates continued to rise. Loan renewals and extensions declined again, but the great majority of respondents noted no change. Volumes of loans declined across all types, with feeder cattle loans seeing the steepest drop."
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