Farmer sentiment and farm service agency direct loan applications

IF 1.5 Q3 AGRICULTURAL ECONOMICS & POLICY Agricultural Finance Review Pub Date : 2024-05-15 DOI:10.1108/afr-09-2023-0126

Chad M. Fiechter, Megan N. Hughes, Sarah A. Atkinson, James Mintert, Michael R. Langemeier

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Abstract

Purpose

Farmer sentiment may be an important indicator for the agricultural sector, similar to the way that consumer sentiment is linked to the general economy. This study uses the Purdue University–CME Group Ag Economy Barometer to test the degree to which farmer sentiment is correlated with demand for United States Department of Agriculture Farm Service Agency (FSA) direct loan applications.

Design/methodology/approach

We estimate the dynamics between farmer sentiment and applications to FSA direct operating or farm ownership loans using monthly measures of farmer sentiment and loan applications from October 2015 to April 2023 and pairwise vector autoregression.

Findings

A negative relationship exists between farmer sentiment and FSA direct operating loan applications. In contrast, a positive relationship exists between farmer sentiment and FSA direct farm ownership loan applications. Together, the estimated nonzero relationships suggests that the Ag Economy Barometer may be a leading indicator for the Agricultural Economy and that FSA loan programs play a nuanced role in the agricultural credit market.

Originality/value

This study uses unique data sources to further the discussion on the link between farmer sentiment and real economic outcomes and the role of an important US Federal Government farmer lending program: FSA direct loans.

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农民情绪和农业服务机构直接贷款申请

目的农民情绪可能是农业部门的一个重要指标，就像消费者情绪与总体经济的联系一样。本研究利用普渡大学-芝加哥商品交易所集团农业经济晴雨表来检验农民情绪与美国农业部农场服务局（FSA）直接贷款申请需求的相关程度。设计/方法/方法我们利用 2015 年 10 月至 2023 年 4 月的农民情绪和贷款申请的月度衡量指标以及成对向量自回归来估计农民情绪与 FSA 直接经营贷款或农场所有权贷款申请之间的动态关系。相反，农民情绪与 FSA 直接农场所有权贷款申请之间存在正相关关系。本研究利用独特的数据来源，进一步讨论了农民情绪与实际经济成果之间的联系，以及美国联邦政府重要的农民贷款项目的作用：FSA 直接贷款。

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来源期刊

Agricultural Finance Review AGRICULTURAL ECONOMICS & POLICY-

CiteScore

3.70

自引率

18.80%

发文量

期刊介绍： Agricultural Finance Review provides a rigorous forum for the publication of theory and empirical work related solely to issues in agricultural and agribusiness finance. Contributions come from academic and industry experts across the world and address a wide range of topics including: Agricultural finance, Agricultural policy related to agricultural finance and risk issues, Agricultural lending and credit issues, Farm credit, Businesses and financial risks affecting agriculture and agribusiness, Agricultural policies affecting farm or agribusiness risks and profitability, Risk management strategies including the use of futures and options, Rural credit in developing economies, Microfinance and microcredit applied to agriculture and rural development, Financial efficiency, Agriculture insurance and reinsurance. Agricultural Finance Review is committed to research addressing (1) factors affecting or influencing the financing of agriculture and agribusiness in both developed and developing nations; (2) the broadest aspect of risk assessment and risk management strategies affecting agriculture; and (3) government policies affecting farm profitability, liquidity, and access to credit.

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