Source: Federal Reserve Bank of Kansas City

Strength in farm real estate values persisted in the second quarter despite some moderation in the farm economy and higher interest rates. Growth in farmland values eased from the surge of recent years, but remained strong through the first half of 2022.

Broad strength in farm finances during recent years continued to support agricultural credit conditions. Margins for many major commodities have thinned in recent months alongside elevated production costs and softening prices. Farm loan performance remained historically strong through early 2023 and liquidity levels at many agricultural banks were well positioned to meet growth in lending demand that could be on the horizon.

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