Farm Sector Assets, Debt, and Equity All Forecast To Increase in 2013

The most important factors affecting the value of U.S. farm sector assets, debt, and wealth (equity) in 2013 are net income and borrowing costs. The 2011/2012 droughts are unlikely to have an immediate effect on the 2013 sector balance sheet since farm asset values and debt levels tend to be based on expectations of longer term farm profitability. If the droughts are viewed as aberrations, they may not affect longer term expectations. Farm asset values are expected to rise 7.7 percent in 2013 and farm sector debt is expected to increase 3.2 percent. As a result, farm equity is expected to increase by 8.3 percent in 2013 (see table ).