Financial Stages of a Farmer’s Life: Effects on Credit Analysis Measures

Farm financial performance measures are evaluated for producers across five age groups. The debt-to-asset ratio is highest for farmers in the lessthan- 30 age group, 45.5 percent, and decreases across age groups. Repayment capacity is strongest for farmers in the less-than-30 age group, 2.1:1, and weakest for farmers in the 50-59 age group, 1.3:1. Operating profit margins tend to increase as farmers become more experienced. A key element in the financial evaluation of farmers through the life cycle is differing degrees of land ownership.