Directors from Farm Credit overwhelmingly believe the greatest challenge facing farmers this growing season are commodity prices.

More than 64 percent of the directors — from the boards of 17 Farm Credit lenders in 15 states and of AgriBank, their St. Paul-based funding bank — said commodity prices are the greatest challenge facing ag producers this year. The directors, most of whom are also farmers or ranchers, indicated the next biggest challenges are input costs (over 21 percent), and Mother Nature (nearly 8 percent). Farm Bill implications and land rents were each cited by approximately 3 percent of the respondents.

“The USDA forecasts real (adjusted for inflation) net farm income will be in the low $50 billion range annually for the next 10 years, which is down dramatically from recent highs and similar to the 1980s,” said Jeff Swanhorst, executive vice president, Credit, and chief credit officer of AgriBank. “The USDA 10-year baseline forecast assumes no domestic or external shocks to global ag markets and is largely driven by prices for corn and other key commodities, which have fallen significantly over the last couple years. All we know for sure is the forecast will be wrong. Farmers will make many adjustments, depending on their circumstances, and they’ll be rewarded for their entrepreneurial spirit, management and good old-fashioned hustle.”

The survey was conducted during the AgriBank 2016 Annual Meeting on March 8.  Ninety participating directors represent 17 Farm Credit affiliated associations and 15 states from Wyoming to Ohio to Minnesota to Arkansas.  Results for this year closely followed trends from 2015.