Report: Ag lending increased in ’24

Farm banks made $115.1 billion in agricultural loans last year, up 6.4 percent from 2023, according to the American Bankers Association annual farm bank performance report. .Banks in the Plains reported the strongest ag lending growth, according to the ABA, up 8.54 percent to $43.8 billion. Regional production lending increased 12.78 percent. Sparked by a rise in production loans, farm banks in the South increased lending nearly 7 percent to nearly $10 billion. Farm banks in the Cornbelt increased ag lending 5.07 percent to $54.5 billion as production loans increased nearly 6 percent and farmland loans rose 4.5 percent. Farmland-secured lending increased 4.7 percent to $65.9 billion. Agricultural production loans rose nearly 9 percent to $49.3 billion. Farm bank loan delinquency rates were minimal, with non-current ag loans falling to 0.32 percent. Equity capital increased 8.1 percent to $49.6 billion, while Tier 1 capital rose 6.7 percent to $55.7 billion. U.S. banks held $205 billion in farm credit at the end of last year, which was 38 percent of total farm lending nationwide. Farm bank net income increased 7.2 percent to $5.9 billion on an annualized basis as the vast majority of farm banks were profitable in 2024. Banks made more than 1.1 million small farm loans worth $72 billion, according to the ABA. Farm banks had 63.4 percent of all small farm loans by value, including $9.1 billion in loans with origination value less than $100,000.“Farm banks continue to be a cornerstone of rural America’s financial well-being,” said Ed Elfmann, ABA senior vice president of agricultural and rural banking policy. “In 2024, these institutions demonstrated the strength and resiliency that comes from deep community roots, prudent capital management and a steadfast commitment to America’s farmers and merchants.” The U.S. Department of Agriculture expects a rebound in farm income this year as farmers face high input costs, export uncertainty and interest rate volatility. “The next 12 months will test agricultural resilience once again,” Elfmann said. “But America’s farm banks are ready, willing and able to meet the credit needs of producers through any cycle.”