Federal Reserve: Livestock lending on the rise | TSLN.com

Federal Reserve: Livestock lending on the rise

A new report published Tuesday, Feb. 8, by the Kansas City Federal Reserve Bank showed a sharp rise in demand for livestock-related loans to pay for more expensive animals and rising feed costs. Most of the 14 percent rise in livestock loans last year was aimed at higher animal prices, with the average size of loans up 27 percent.

The report noted the average price of feeder cattle is up 27 percent over the past year to $125.02 per hundredweight. That means an 800-pound animal costs about $210 more this year. So far, the report said, rising livestock prices have largely offset the rise in feed costs. Shrinking cattle numbers and strong beef demand have also supported rising cattle prices.

That’s good news for future producer-borrowers, said Jason Henderson, who wrote the report. “As long as livestock prices remain high and there is profitability for producers, I do not see lenders being reluctant to lend money to producers.”

A new report published Tuesday, Feb. 8, by the Kansas City Federal Reserve Bank showed a sharp rise in demand for livestock-related loans to pay for more expensive animals and rising feed costs. Most of the 14 percent rise in livestock loans last year was aimed at higher animal prices, with the average size of loans up 27 percent.

The report noted the average price of feeder cattle is up 27 percent over the past year to $125.02 per hundredweight. That means an 800-pound animal costs about $210 more this year. So far, the report said, rising livestock prices have largely offset the rise in feed costs. Shrinking cattle numbers and strong beef demand have also supported rising cattle prices.

That’s good news for future producer-borrowers, said Jason Henderson, who wrote the report. “As long as livestock prices remain high and there is profitability for producers, I do not see lenders being reluctant to lend money to producers.”

Recommended Stories For You

Go back to article