From Agrimoney:
Fitch Ratings added its voice to those cautioning of deteriorating prosperity for US crop farmers, but underlined that a repeat of the 1980s, when the sector crumbled under the weight of its debts, did not look on the cards.The credit ratings agency forecast "modest income declines" for US crop farmers, flagging the potential for "continued pressure on corn prices" from improved growing conditions which have provoked forecasts of a record harvest.And the downturn in takings - after a spell of growth which has driven overall US farm sector net cash income from $75.6bn in 2009 to $134.7bn last year, on US Department of Agriculture estimates – could prove prolonged."Some long range forecasts see the potential for corn prices to remain below $5 per bushel for several years," Fitch said."This type of sustained price weakness, coupled with a fall in farmland values, would put nominal pressure on Corn Belt incomes and asset quality."'Pull-back in land values'This could feed into sector credit conditions too, Fitch noted, flagging the potential for a fall in farmland values to cut borrowing collateral."Over time, a pull-back in crop prices and land values from record levels could cut farmers' incomes and net worth modestly across the US Corn Belt," the ratings agency said....MORE
