By Faith Parum
Key Takeaways
- Farm bill credit programs help farmers and ranchers access financing when they cannot obtain sufficient credit through traditional commercial lenders.
- Access to credit is increasingly important as farmers face historically high production costs and multiple years of tight or negative margins.
- In fiscal year 2025, FSA obligated $6.74 billion across 27,792 farm loans, up 25% in dollars and 13% in the number of loans from fiscal year 2024.
- Beginning farmers accounted for 15,552 loans totaling $3.53 billion in fiscal year 2025, representing approximately 56% of all FSA farm loans and 52% of dollars obligated.
Farming requires significant capital. Producers pay for seed, fertilizer, feed, fuel and other inputs months and sometimes years before crops are harvested or livestock are sold. Buying farmland, machinery and other long-term assets often require even more financing.
Those needs are growing. USDA projects total production costs for major field crops to reach new highs in 2027. At the same time, commodity prices have not kept pace with expenses. This leaves farmers operating below break-even, or at a loss per acre. Higher costs and several years of weak margins can drain working capital and weaken farm balance sheets, making access to affordable credit increasingly important.
Most agricultural credit comes from private lenders, but not every producer can qualify for enough commercial financing. Beginning farmers may have limited equity or credit history, while established farms can face credit challenges after natural disasters, poor yields or several years of low returns. Title V, the credit titleof the farm bill, helps fill some of these gaps through farm loan programs administered by USDA's Farm Service Agency, or FSA.
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