Mike Pearson examines how interest rates are impacting the agriculture sector.

In 2021, 90 percent of operating loans were under 5 percent. This year, it's north of 8 percent.

Inflation increased during COVID in 2021 and the Russia-Ukraine conflict.

So, the federal government started to raise interest rates in an effort to fight inflation.

Currently, the federal rate is 5 1/4 percent which makes an interest rate around the 8 percent mark.

This makes the pressure on farm operators increase because of the high interest rates and a high cost of production.

The interest rates bumps have cooled inflation enough which means interest rates could continue to go up until inflation rates hits 2 percent.

Farmers should move to refinance debt because interest rates aren't going anywhere anytime soon.

Farm Progress America is a daily look at key issues in agriculture. It is produced and presented by Mike Pearson, a farm broadcaster and host of This Week in Agribusiness.