farm economy
Rural Iowa was important but not decisive for Trump, says analysis
Former president Donald Trump won 60 percent of the rural vote in Iowa’s Republican presidential caucuses, well above his statewide total of 51 percent. But his victory Monday in the first-in-the-nation test of voter support for presidential candidates was built on the vote in towns, where most Iowans live, said a Daily Yonder analysis.
As inflation falls, ‘backwards pressure’ on food prices, analyst says
Compared to food price inflation of 11 percent in 2022, grocery price increases will be virtually nonexistent this year, said a Wells Fargo analyst Wednesday during a panel discussion on the 2024 outlook for the food and ag sector. A Rabobank analyst said that softer commodity prices would take the steam out of the hot farmland market.
Farm income this year will be second-highest ever, says USDA
U.S. net farm income will be a stronger-than-expected $151 billion this year, the second-highest total on record, estimated the Agriculture Department on Thursday. That’s roughly $10 billion higher than the August forecast and due chiefly to cost cutting by producers, aided by lower fertilizer, fuel, and feed prices.
High interest rates discouraging farmers from borrowing money
Ag bankers say farmers are tapping their savings from recent boom years instead of borrowing money at what are the highest interest rates since 2007. The average operating loan issued this past summer was nearly 20 percent smaller than the average a year ago, the lenders said in surveys by regional Federal Reserve banks.
Some signs of softening farmland values, says Fed economist
Although farmland values are strong, some ag bankers report a downturn in prices in the central Plains after a three-year run-up in values, said senior economist Cortney Cowley of the Kansas City Federal Reserve on Wednesday. The majority of bankers, however, expect farmland values to hold steady or increase moderately.
Vilsack: Farm bill ‘is not the only tool available’ to expand ag economy
The Biden administration is broadening the U.S. agricultural economy through climate-smart and bioproduct initiatives while Congress is seemingly stymied over the new farm bill, said Agriculture Secretary Tom Vilsack on Monday. He warned against raiding conservation funding to pay for higher reference prices for corn, soybeans, and other row crops, a leading goal of farm groups.
Stronger farm bill is antidote for weakening income, says GOP report
Congress should provide a “meaningful enhancement” of crop subsidies and the crop insurance program in light of declining farm income, said Republican staff workers on the Senate Agriculture Committee on Thursday. “Headwinds persist in the U.S. farm economy,” they said in a report, pointing to a slowdown in farm exports, weakening commodity prices, high production costs, and rising interest rates.
Farm finances are strong despite moderation in ag economy
Agricultural credit conditions are likely to remain strong through the end of this year, although bankers expect farm income and loan repayment rates, now the healthiest since 2010, to soften in the months ahead, said the Kansas City Federal Reserve on Thursday.
Impetus slows for higher cropland values, say ag bankers
The farm real estate market was resilient in the face of higher interest rates and "some moderation" in the farm economy this spring, according to commercial lenders surveyed by five regional Federal Reserve banks.
High interest rates fall heaviest on less-profitable farmers
Interest rates doubled in the past year for agricultural loans, the fastest increase since the early 1980s, with the least-profitable farmers feeling the impact the most, said the Minneapolis Federal Reserve Bank. “All producers should prepare for elevated interest rates by incorporating higher interest expenses into cash flow projections regardless of profitability and debt levels,” it said.
High costs and softer markets weigh on outlook for farm economy
With interest rates sharply higher, farmers are increasingly relying on savings or tightening their belts instead of seeking bank loans to cover their expenses, according to ag lenders nationwide. “The outlook for the U.S. farm economy has moderated in recent months as risks of more limited profit opportunities have grown alongside softening in commodity markets and elevated production expenses,” said the Kansas City Federal Reserve Bank.
Lack of right-to-repair may cost farmers more than $3 billion, says survey
A survey released this week shows that farmers are losing an average of $3,348 per year to repair downtime and restrictions because farm equipment makers limit their ability to fix tractors, combines, and other equipment.
Farm finances are strong, but rise in land values slows
High commodity prices supported "profit opportunities for many producers across the farm sector" ahead of the spring planting season, although there were concerns about operating expenses, higher interest rates and drought, said the Kansas City Federal Reserve Bank.
More money needed for farm bill, says panel, eyeing climate funds
After describing the farm economy in apocalyptic terms, the House Agriculture Committee voted unanimously on Thursday to seek “additional resources” of an unspecified amount “to enact a strong farm bill in 2023.” The committee also said it would consider whether to divert all or part of the $20 billion awarded to the USDA for climate mitigation to other needy programs.
Premium subsidies for crop insurance near $12 billion a year
In a decade, government outlays to subsidize crop insurance increased 60 percent, expanding in step with the rapid growth in acreage covered by the policies, according to Risk Management Agency data released Sunday.
SNAP claims larger share of farm bill outlays
The new farm bill could cost nearly $130 billion a year — the highest price tag ever — with public nutrition programs getting more than $4 of every $5, wrote associate professor Roman Keeney in Purdue’s annual agricultural economics review. “The overall budget, and particularly spending on the nutrition title (primarily food assistance for low-income households), should continue to be the most politically divisive component of the farm bill debate.”
Potential breakthrough on right-to-repair dispute
The Farm Bureau Federation and John Deere signed a memorandum of understanding on farmers' right to repair their equipment on Sunday — potentially a breakthrough after years of complaints that manufacturers prevented access to the increasingly computerized controls of tractors, combines and other equipment.
Plan for prolonged period of higher interest rates, analysts tell farmers
The highest interest rates in years will complicate farm finances, and operators should expect higher rates to persist for several years as part of efforts to quash inflation, said a team of agricultural economists on Wednesday. Farmers will pay more when they borrow money, face higher break-even levels on investments, and feel downward pressure on the value of farmland, their largest asset.
Democrats in Congress propose $10 billion in economic aid to farmers
With Congress due to adjourn in 10 days, Democrats proposed $10 billion in economic assistance to farmers nationwide to buffer the impact of lower commodity prices. Senior farm-state Republicans have said substantial aid is needed — $15 billion was mentioned on Wednesday — but House GOP leaders reportedly objected to the offset Democrats would use to pay for the aid.