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Farm sector debt tied to real estate is expected to be at a record high of $375.9 billion this year, according to data from the U.S. Department of Agriculture’s (USDA) Economic Research Service.

The new data report noted that farm sector real estate debt has on the rise since 2009 and is expected to reach an amount that is 87.5% higher in 2023 compared with 2009 in inflation-adjusted dollars. Real estate debt now far outpaces debt that is not secured by a mortgage (non-real estate debt).

“Historically, real estate debt and non-real estate debt have trended similarly, but they have diverged in recent years,” said the USDA in its findings. “Non-real estate debt showed an 11.9% year-to-year increase in 2014 in inflation-adjusted dollars but has shown decline after 2017. Meanwhile, there has been a continuous increase in real estate debt since 2009. Growth in farm real estate asset values and relatively low interest rates contributed to the increase in farm real estate debt.”

This year, farm sector real estate debt is expected to be 33% higher than the 10-year average (2012–2021), while non-real estate debt is expected to be 10.2% lower than the 10-year average.

The USDA added the average value of farm real estate reached a record $3,800 per acre in 2022, up 12.4% from the previous year.