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Farm Financial Stress in North Dakota

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Title: Farm Financial Stress in North Dakota
Author: Vreugdenhil, Harvey; Watt, David; Pederson, Glenn
Description: The years of 1981 - 85 produced a significant downturn in the financial sector of North Dakota. Conditions evidenced a decline of farm asset values, a rise in farm debt, the erosion of equity capital, the rise of farm loan delinquencies, increases in voluntary liquidations and even foreclosures. A special farm finance survey was conducted by the North Dakota Crop and Livestock Reporting Service and North Dakota State University in January 1985 funded by the North Dakota Department of Agriculture. The purpose of the study was to document the extend and severity of farm financial problems as they were perceived by the farmers themselves. The information in this study were to be used by state policy makers with applicable information concerning farm owners financial situations in order to determine the best base farm financial assistance initiatives. This article summarizes the finding from this survey. The articles follows as survey procedures, debt load of farm borrowers, effect of high interest rates, farm loan delinquencies, ability to survive and, finally, the conclusions and implications of such findings. The survey did indicate that a wide variety of financial conditions exist amongst North Dakota farm operators. A large percentage reported no problems managing their debt. However, not al farms were expected to weather the then current financial crisis in farming. the challenge for state policymakers was to develop program which would differentiate tween those farms that were in the safe zone and those that were high risk for collapse.
Date: 1986
Subject: Economics
Permalink: http://hdl.handle.net/10365/8805

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