The values of farm business sector assets and equity — assets minus debt — are forecast to rise in 2011, while farm debt is forecast to decline from 2010 levels. Farm sector asset values are expected to rise by 6.8% in 2011 (in nominal dollars) as the values of land and farm buildings, crop inventories, purchased inputs, machinery and equipment and financial assets are all expected to rise in 2011. Farm sector debt is expected to fall from about $247 billion in 2010 to about $243 billion in 2011 (in nominal dollars). The farm business sector's debt-to-asset ratio is expected to decline to 10.4% and debt-to-equity is expected to decline to 11.6% in 2011, indicating that the farm sector's solvency position remains strong.


Farm business balance sheet, 1980-2011


Source: USDA/ERS Agricultural Income and Finance Outlook, December 2011