Farm Economy
As federal policy decisions tend to heavily impact rural industries, the outcome of the 2024 election promises to significantly shape the rural economy in the year ahead. CoBank’s annual report outlines what to expect.
Large-scale family farms (GCFI of $1,000,000 or more) accounted for 48% of the total value of production and 31% of agricultural land in 2023.
While it’s unclear how Congress will push through the Farm Assistance and Revenue Mitigation Act, it’s likely going to be via the Continuing Resolution. Depending on how payments are calculated, farmers could receive $101 per acre for corn, $53 for soybeans and $73 for wheat.
In the third quarter, farm income and loan repayment rates weakened.
A trifecta of high input prices, high interest rates, and depressed crop prices have Sen. Cindy Hyde-Smith (R-Miss.) and Sen. John Boozman (R-Ark.) bringing focus to the economic stress for farmers.
“The agricultural economy is inherently cyclical, and ag lenders are navigating the changing conditions across the sectors they serve,” said Jackson Takach, chief economist of Farmer Mac.
Bayer’s $63 billion purchase in 2018 of seeds and pesticides maker Monsanto was a long-term bet on robust growth in farming supplies which has so far misfired.
Sen. John Thune (R-S.D.) wins Majority Leader race. Sen. Rick Scott (R-Fla.) was eliminated on the first ballot. And Thune beat Sen. John Cornyn (R-Tex.) 29-24 on the second ballot.
Trump garnered even stronger support in rural America versus his still robust rural vote in this first administration. That is likely a backlash against the ag policy moves of the Biden/Harris administration that focused on underserved and minority rural citizens.
Yes, the Fed is cutting interest rates but the agency can only influence mid- and long-term rates. Concerns about inflation are pushing those rates back up again.
The October Monthly Monitor reflects cautious optimism in certain areas of agriculture, marked by export strengths and potential price recoveries, but shadowed by long-term rebuilding challenges, weather dependencies and the impact of the upcoming election.
Exit planning is more than just preparing to walk away from the business.
When ag equipment manufacturers start shedding union line workers, shuttering plants and shifting factories to Mexico, and there’s a glut of used equipment covering dealer lots, you know the tide is quickly turning.
Two land sales last week came in at a whopping $17,000 per acre, and one in Iowa topped $20,0000 just this week.
There is uncertainty about the Farm Bill’s progress due to potential changes in the political landscape. One thing is certain: farmers need a new Farm Bill.
FAPRI Updates Ag Baseline Projections, Painting a More Negative Picture for Soybean Prices Than USDA
In the absence of new shocks to the weather, the macroeconomy or policy, FAPRI projects prices will generally remain near current levels over the next five years.
Federal Reserve Chair Jerome Powell’s testimony before the Senate Banking Committee provided several key insights into the current economic landscape and potential future monetary policy actions.
The Federal Reserve has four more chances this calendar year to cut interest rates. Since July 2023, the system has kept its benchmark interest rate steady at a 23-year high of 5.25% to 5.5%.
Agriculture can sometimes act as a buffer during broader economic recessions, as demand for essential food items tends to remain relatively stable. However, when multiple indicators align in the industry, it can signal a recession.
U.S. corn prices hit a four-year low as the prospect for record corn and soybean crops takes shape in the field. The eroding outlook also appeared in the August Ag Economists’ Monthly Monitor.
Declining demand for wine and an increase in imported wine means there’s a glut of grapes this year, and it’s so bad there’s a surge in the amount of unharvested grapes that still don’t have a home. Now, there are fears it could ultimately force more true family farmers out of business.
A new Kansas City Fed report shows farm incomes continued to weaken, particularly in crop-heavy states like Kansas, Missouri, and Nebraska, while cattle prices provided some support.
Recessions often lead to decreased demand for certain agricultural products, particularly those considered discretionary, such as cotton, dairy, specialty meat products and vegetables. This can result in lower prices for these commodities, affecting farmers’ revenues.
Farm Credit Services of America and Frontier Farm Credit released their benchmark farmland values report showing a 2.4 percent decline in cropland values.
Beginning Sept. 1, Cargill will transform from five enterprises into three: Food, Ag & Trading and a Specialized Portfolio, the memo said.
USDA’s current net farm income forecasts show a $90-billion plus drop over the two-year period, making it the largest dollar value loss, adjusted for inflation, that agriculture has ever seen.
Testimony at House Ag hearing Tuesday captured the downturn and anxiety in the ag sector.
Property insurance costs for farmers and ranchers have been increasing, driven by several factors, including climate change, market conditions, and rising production expenses.
The push for more solar energy projects across the U.S. is intersecting with agriculture, and as farmland has become a key target for projects in the Midwest, it’s creating some eye-popping offers.
Headwinds in interest rates, inflation and commodity prices seem to have little impact on land values, though single-digit decreases in Indiana, Kentucky, Michigan and Ohio have been reported.