Earnings reports in agriculture can be a challenge, but the news from Northwest Farm Credit Services is good. The organization — the Northwest's top financial cooperative, which serves agriculture, forestry, fisheries and rural communities — announced its 2016 earnings.

For 2016, the organization posted earnings of $247.2 million, compared to $255.6 million in 2015. The higher earnings of 2015 were the result of larger credit loss reversals in that year. Total capital rose 7.2% during 2016 to $2.2 billion.

In releasing the results, Phil DiPofi, president and CEO, commented: "Despite the downturn in price and demand for some agricultural commodities, 2016 turned out to be another year of solid financial performance for our collective customer base. As a result, Northwest FCS continues to grow in loan volume, capital and patronage paid to our customer-members."

As a cooperative, Northwest FCS returns a share of its net earnings to customer-members in patronage dividends. The Northwest FCS board recently approved patronage of 1% of a customer-member's eligible average daily loan balance.

Cash patronage for 2016 totaled a record $99.4 million, higher than the $91.9 million for 2015. Since the patronage program began in 2000, the organization has returned $690 million in cash patronage to customer-members.

Market conditions across region
As part of the annual report, the organization also produces reports on market conditions across a range of key areas for the region, from specific crops to other trends like land values. In the 2016 land values report, the overall for the region shows values continuing to rise, but the report is broken up by state as well. Report readers can drill down by state to learn that while Idaho is seeing strong demand for properties statewide, boosting land values, the same is not true in Montana, where demand is more stable. In Montana, the association reports that values have not been hit by softening grain and cattle prices.

For crop inputs, the association notes that fertilizer prices were sliding and maintaining a long-term descent in prices, which is pressuring retailers. The report also shows that mergers and acquisitions are impacting the industry, from seeds and crop protection to local dealers. You can check out these trends at bit.ly/NW-fcsinsights.

Source: Northwest Farm Credit Services