g due to finances a the Southern Plains and less than 20 percent of assets in the Nor theast and Appalachia. Debt Risk and Farm Size Average debt-to-asset ratios also tend to rise with farm size. In other words, the larger farmers are typically carrying the largest debts relative to assets. The smaller farms usually carry less of a debt load, plus they tend to show greater stability in total income because more of their income comes from off-farm employment. “Farms having the most problems with debt and cash flow are primarily the highly leveraged commercial-size farms (those with annual sales of $40,000 or more),” confirms George Amols. “owners of smaller farms appear to be in much better financial shape.” At the start of this year, nearly a third of operations in the $40,000 to $199,999 sales class had debt-to asset ratios of 40 percent or more. More than four out of ten farms in the $200,000-plus sales class carried debt ratios of 40 percent or more. That’s considered a high risk position. Debt-ridden operators are having an impact on the entire farm sector, where average debt to-asset ratios have continued to climb. Debts were equal to 17.0 percent of assets in 1980. By January 1, 1984, the ratio had hit Super Hi-Power Lug RADIAL Small Rear Farm 21.6 percent, a historical high. In the same period, outstanding debts rose from $l7O billion to $2Ol billion. Meanwhile, farm sector assets declined in value from $986 billion to $929 billion. Analysts don’t expect an im mediate improvement in the farm financial situation. More than 60 percent of total farm debt is owed by highly leveraged operators. “Lenders know,” says Amols, “that even if farm income im proves, a large portion of their customers will continue to have serious cash flow problems.” Financial problems for farm borrowers bring financial risks for farm lenders. “Farm lenders will probably face a challenging credit en vironment for several years to come,” adds Stephen Gabriel. “Their continued profitability and strong capital positions indicate they have the ability to cope with future difficulties in the farm sector, but their resiliency may well be challenged." The Farmers Home Ad ministration (FmHA) typically carries the greatest share of high risk loans. In 1980, FmHA was followed by production credit associations (PCA’s), merchants who sell products on credit, and (Turn to Page D 26) 18R34 6 ply $419.00 18R38 6ply 535.00 18R388ply 569.00 20 Bx3B 8 ply 650.00 20 3x38 10 ply 725.00 Special Deal On Mounting During This Program. Ask About It. 750x20 750x24 8.3x24 9 5x24 11.2x34 11 2x36 12 4x36 13.6x36 59.95 64.95 79.00 84.00 135.00 137.00 155.00 189.00 Lenders Affected All Orders This Week Delivered Free To Your Farm Over 250.00 - Under 250.00, Only Small Fee Extra Where Debt-Asset Ratios Are Highest Debts as a percentage of assets by region Jan 1 1963 (Jan 1 1980 figures in parentheses) Debts as a percentage ol Jan. 1,1984 Jan. 1,1980 Armstrong FARM MUSCLE Hi Power Lug 22x11.00-8 25x12-9. . 18x950-8 . assets by farm sales class $20,000 -$39,999 $lO,OOO $19,999 15.9% 15.7% 12.7% 12.8% 11 2x24 4 ply 14 9x24 4 ply 14 9x24 6 ply 14 9x24 8 ply 16 9x24 6 ply 16 9x24 8 ply 14 9x26 6 ply 18 4x26 6 ply 231x26 8 ply 11 2x28 4 ply 12 4x28 4 ply 13 6x28 4 ply 13 6x28 6 ply 14 9x28 4 ply 14 9x28 6 ply 16 9x28 6 ply 16 9x28 8 ply 16 9x30 6 ply 18 4x30 6 ply 23 Ix3o 8 ply 24 5x32 10 ply 16 9x34 6 ply 18 4x34 6 ply 18 4x34 8 ply 20 8x34 6 ply 20 8x34 8 ply 23 1x34 8 ply 11 2x38 4 ply 12 4x38 4 ply 13 6x38 4 ply 13 6x38 6 ply 14 9x38 6 ply 15 5x38 6 ply 16 9x38 6 ply 18 4x38 6 ply 18 4x38 8 ply 20 Bx3B 8 ply $38.01 554.71 $30.65 lancootor Farming, Saturday, November 10,1984—025 /-r* 1 "ssss* i mm \ (160)JJ Corn Belt k 21.4% I \(lsoj^ _,Appalachia \ ✓ i£__—-19-5% I Delta] L '3 k 2l 5% Southeast^ \ (17 2) 22.5% Y I S- (18 S)—^ $40,000 -$99,999 $lOO,OOO -$199,999 21.5% 19.4% 15.2% 16.7% ■ jIBMIQ Machine Work fw a | - Farm Supplies OpipiJpi _ w '^ r Hardware * p ■ ! CUSTOM BUILT WOOD & | I COAL STOVES B ■ • Welders & cutting torches _ I • Custom made farm gates, etc. ■ | • Custom built high pressure washers I w • Stainless steel, aluminum and spot I . welding. • UPS Service | B HIGH TENSILE WIRE FENCING g PLATE SHEARING AND PRESS BRAKE WORK O.S. MACHINE SHOP DAVID E. STOLTZFUS ■ 3816 E. Newport Road ■ Gordo nville, PA 17529 | 1 Mile East of Intercourse on Rt. 772 EAR CORN Paying Top Prices For Good Quality Ear Corn • Wet or Dry • No Quantity too large or too small Fast Unloading - Dump on Pile & Go Easy access - 2.2 miles off 283 bypass- Manheim, Mt. Joy exit Daily Receiving 7:30 A.M. to 5 P.M. - un loading evenings & Saturdays by appt. Trucks available for pick up at your farm. Call Anytime For Price 717-665-4785 JAMES E. NOLL GRAIN $500,000 and up $200,000 -$499,999 36.6% 27.0% 30.4% 19.9%
Significant historical Pennsylvania newspapers