Cattle prices are up with the shrinking cow herd. American Farm Bureau Federation Livestock Economist Bernt Nelson said that makes it more expensive for farmers and ranchers to expand. Higher interest rates are also an issue. “The cost of capital is going up and that has the potential, much like the 80s, to create a liquidity problem,” said Nelson. “I’ve talked to bank presidents that started their careers in 1982 and that is the first place their minds go, they haven’t heard this kind of interest-to-gross revenue ratios since the 80s.” Nelson, a North Dakota native, was on the program at the Ag Outlook Forum.
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