Loans by America's biggest agricultural lender to farmers have collapsed by 95% in a year, as pig rearers joined dairy farmers and ethanol plants on its black list of poorer credit performers.

The Farm Credit System said that growth in its loan book slowed to $763m in the July-to-September quarter, from $15.2bn a year before.

The organisation, America's federally-backed rural lending network, said that the slowdown reflected diminished demand for loans, "due to the decline in commodity prices", as well as tight lending criteria.

"In light of the current economic conditions, [lenders] have carefully managed their loan growth in order to maintain conservative capital ratios," the system said.

The slowdown comes amid a tightening of farm budgets which has prompted huge cuts in profits at suppliers such as machinery groups and fertilizer companies.

'Credit quality under pressure' 

US agriculture's travails were also reflected in a jump to $256m in Farm Credit funds set aside to cover bad debts, four times their level of a year before.

The increase, which followed two quarters of waning bad loan provisions, was prompted in particular by hardship in ethanol, dairy, hog and forestry industries.

"The deterioration in [these] sectors was the result of decreases in revenue from lower prices and increases in input costs, particularly for borrowers who purchased crops or feed at elevated prices in 2008 for future production or breeding," the network said.

Jamie Stewart, the Farm Credit System chief executive, said: "Credit quality in certain sectors of the loan portfolio remains under pressure."

The Farm Credit System is a network of financial institutions created by Congress in 1916 to provide farmers with loans at competitive rates. Its 99 associations and banks have historically provided roughly one-third of US agricultural loans.