Reduced profits in the crop sector persisted in the fourth quarter of 2014, leading to a sharp rise in farm-sector borrowing and a slight decline in cropland values.
A near-record fall harvest pushed crop prices to their lowest levels in five years, eroding profit margins and prompting a rise in loan volumes to finance short-term operating expenses.
Farmland markets also cooled amid prospects of lower farm income, particularly in heavy crop-production areas. Should low crop prices and high input costs persist, crop sector profit margins may weaken further and strain loan repayment capacity in the coming year.
"What You Need To Know About South Dakota Agricultural Law"
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