Ag News, Wednesday March 16, 2016

Ag News Headlines from Wednesday March 16, 2016 include Farm Banks Report Robust 2015 Performance and Small Tractor Sales Up 26 Percent.

Farm Banks Report Robust 2015 Performance

The American Bankers Association says agriculture lending increased 7.9 percent in 2015. The Farm Bank Performance Report released this week by ABA found farm banks produced $100.3 billion in agriculture loans at the end of last year. Farm banks reported continued improvement in asset quality in 2015, with non-current loans declining to a pre-recession level of 0.47 percent of total loans. The report also shows that small and micro-small loans made up almost half of agricultural lending by banks in 2015. Looking ahead to 2016 and beyond, an ABA spokesperson said the banks remain well positioned to continue serving the needs of their communities despite any potential turbulence in the ag sector. The nation’s 1,976 farm banks — defined as those whose ratio of domestic farm loans to total domestic loans is greater than or equal to the industry average — added more than 2,500 jobs, a 2.9 percent increase, and employed 90,000 rural Americans.

Small Tractor Sales up 26 Percent

Retail sales of farm tractors less than 40 horsepower were up 26.2 percent last month compared to February of 2015. The Association of Equipment Manufacturers says the numbers show a strong start to 2016 and a continuation of last year’s trend with year-to-date growth of 19.7 percent. Retail sales for 2WD tractors of 40-100 horsepower grew by 5.8 percent in February compared to last year bringing the year-to-date growth to minus .9 percent. However, AEM notes that there continues to be volatility in this tractor segment. The expected decline in 2016 farm income and in particular the 4.3 percent decline in livestock receipts will be challenging. Larger production agriculture farm equipment such as the two wheel drive 100 horsepower and up category continued its double-digit declines. The four wheel drive farm tractor segment declined by single digits in January; however, the February report revealed a 43.6 percent decline year over year.

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