Middle East conflicts are impacting U.S. agricultural credit through rising fuel and fertilizer prices. A survey by the Chicago Fed on agricultural lending institutions across five Midwest states shows that the farm loan repayment rate index declined year-on-year in the first quarter of this year, marking the 10th consecutive quarter of decline. Meanwhile, loan demand has increased, reflecting farmers' growing financing pressure as they face higher input costs. Previously, Trump's tariffs last year had suppressed exports of key crops; now, the war is driving up energy and fertilizer costs, further straining farmers' cash flow. Banks have begun monitoring agricultural clients' risks more closely. In response to cost pressures, farmers are cutting expenses—reducing planting areas, switching to crops with lower fertilizer demands, or reducing fertilization while maintaining existing crops—which may depress future yields.
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Original article: toutiao.com/article/1866224957301771/
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