Vilsack's Perspective on Farm Economic Situation

Vilsack's Perspective on Farm Economic Situation

On Wednesday USDA Secretary Tom Vilsack spoke at the Senate Ag Committee hearing about several topics one being the ag economy. There has much in the news about the deteriorating nature of farm profits, Vilsack shares perspective on the farm economy and says it isn’t all negative.
Vilsack: “Export markets are up and we are projecting a slight increase on export markets. Obviously this Congress and Senate will be make determinations potentially on possible trade agreements that could substantially expand opportunity. Secondly we are looking at debt-to-equity. The lowest debt-to-equity level we have ever experienced was 11.3 percent. The debt-to-equity level today is 12.4 percent. In 1985 — in the midst of the Farm Crisis that you and I are certainly aware of — it was 22 percent so the debt-to-equity ratio still appears to be strong. Then we look at the farmers and farm operations that are extremely leverage or highly leveraged. Those are the people that we are most concerned about because those are the folks on the edge. We calculate that roughly 10 percent of the operations — about 6 percent in the livestock side and 4 percent in the grains — are in those two categories. So 90 percent are outside of those two categories.”

 

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