Southern Outlook Conference Agricultural Outlook Atlanta, Georgia September 28, 2009. Bill Melton Chief Lending Officer. Farm Credit System. Farm Credit System Credit Quality. AgFirst District. AgFirst District Credit Quality. Current Credit Conditions Deterioration Began Early in 2008.
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Southern Outlook ConferenceAgricultural OutlookAtlanta, Georgia September 28, 2009
Chief Lending Officer
Current Credit Conditions Deterioration Began Early in 2008
The Speed and Severity of the Economic Correction
District is Inseparably tied to the General Economy
-Strong capital levels will need to support the weaker credit quality
-But no positive credit quality bounce
-However, treasury profit will diminish over time
-Level of earnings will impact patronage distributions
2009 Farm Prices Weakening
Farm Income Conditions Will be Diverse Again in 2010
Livestock and dairy losses may drive income back to 2006 levels!
Recovery in 2010 will be limited with grains complex watching stock buildup and livestock/dairy completing liquidation process.
“Current period earnings are sufficient to fully fund all provisions for loans/investments and generate estimated net income of $272.4 million”
Ag SectorBalance Sheet Still Solid
Deleveraging is not issue for much of agriculture!
Eat more pork and drink more milk!