Guest editorial: Nontraditional Credit in U.S. Agriculture

Understanding the sources of credit for agricultural production is critical for regulators and policymakers concerned with the stability of financial institutions, agricultural production and the welfare of farmers.Research in this special issue sheds new light on nontraditional farm credit by exploring the scope and range of this lending, the services provided to farmers, and the role this credit plays in the agricultural economy.Several of the articles included herein draw heavily on the Agricultural Resource Management Survey (ARMS) and the Farm Income and Wealth data series, two of USDA's premiere data products.Every year since 1996, ARMS has asked a nationally representative sample of farmers and ranchers a series of detailed questions about their outstanding loan balances, including questions on lender type that underlie one definition of a nontraditional lender.ARMS-based aggregate measures of nontraditional lender activity are included in the sector balance sheet within the Farm Income and Wealth data series.Stretching back even longer (to 1960), USDA's farm sector balance sheet provides loan balances from regulatory and administrative sources alongside an "individuals and others" line item for debt and reflecting the size of the nontraditional sector over time.This research, in addition to highlighting the role of nontraditional lenders, explicitly underlines the value of USDA's commitment to long term data collection in order to understand the structure and dynamics of the agricultural sector. MotivationThe financing of production agriculture has become increasingly diverse, in terms of credit delivery and terms, as well as lender type or source of credit.Yet, most agricultural finance research still focuses on traditional agricultural lending relationships.The goal of this special issue is to advance the literature on non-traditional finance in US agriculture and lay a foundation for future research, while also providing insights for farm managers, industry and policymakers.Navigating complex financing options is an integral component of modern farm management.From a policy perspective, financial regulators, such as regional Federal Guest editorial 205The authors are grateful to the USDA ERS for supporting this special issue.All papers in