Economic and Financial Conditions Bode Well for U.S. Agriculture

U.S. agriculture entered the most recent recession better positioned than most U.S. industries, was less affected by the recession than most other U.S. industries, and is likely to continue to do well in the years ahead. The farm sector was bolstered by several years of strong income growth, rising farmland values, and low dependence on debt, so both farmers and farm lenders were in a relatively strong financial position. Strong demand for U.S. agricultural products, led by the expansion of developing-country markets, an extended period of depreciation in the real exchange rate, and growing demand for biofuels, has bolstered both the performance and prospects of U.S. agriculture.