Federal Reserve summarizes economic conditions in ag
Crop progress remains behind average due to late spring planting, and yields are likely to be affected. While much of the District corn and soybean crops remain in good or excellent condition, overall quality has fallen in recent weeks.
However, in Minnesota, apple growers are expecting a strong harvest. Prices received by farmers in September increased from a year earlier for hogs, cattle, milk, dry beans and chickens; prices for corn, wheat, soybeans, hay, eggs and turkeys fell from a year earlier.
Tenth District—Kansas City
In the agriculture sector, crop production expectations were little changed from the previous survey period, but falling prices lowered farm income expectations. With most of the corn and soybean crops still in relatively good condition, overall District yields were expected to be about average.
As harvest began, however, a greater probability of near-record corn and soybean production nationally led to a drop in prices, cutting farm income expectations. Meanwhile, heavy rainfall in Colorado and flooding along the South Platte River affected some agricultural lowlands.
Scattered storms slowed harvest activity and winter wheat planting, but helped soil moisture conditions. Lower feed prices narrowed losses for cattle feedlot operators and improved profitability for hog producers.
Weaker farm income prospects were expected to curtail farm household and capital spending, but demand for quality farmland remained strong.
The District remained largely in drought, although the severity lessened in late September in Texas due to good rainfall and the excessive heat tapering off. The harvest progressed normally for row crops, and conditions were mostly fair to good. Improved moisture conditions increased optimism for the winter wheat crop. Beef exports increased over the reporting period.
Weather issues are still a significant dynamic for agriculture, impacting crops (and subsequently livestock) because of both drought and excessive moisture. While crop prices have declined, they have not had a significant negative impact on land values. And economic conditions were generally good for agriculture.
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