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poultry labor
Everett Griner talks about what eating all of that poultry means for the economy in today’s Agri View. Hear Everett’s report and learn more. →

Rural Mainstreet Climbs to Highest Level Since September 2015:
But Only 15 Percent Report Expanding Economy

February Survey Results at a Glance:
rural mainstreet
* The overall index, while remaining below growth neutral, rose to its highest level since September 2015.
* More than one-third of bank CEOs reported their local economy remains in an economic downturn.  Only 14.9 percent of bankers indicated their local economy was expanding.
* On average, farmland prices have declined by 5.1 percent over the past 12 months. Continue reading

Demand Growth, China’s Reserve Auctions and Global Supply Response Hold Keys for the Coming Year

national cotton council economic outlook
National Cotton Council economists point to a number of key questions that will shape the 2017 economic outlook for the U.S. cotton industry. In recent months, cotton prices have maintained a stronger appearance despite: 1) concerns about world demand, 2) Chinese imports below historical levels, 3) weakness in other commodity markets and 4) a stronger dollar. Although several bearish indicators are still in place, a lack of exportable supplies in Central Asia and West Africa coupled with India’s reduced exports is helping to support current prices. In addition, unfixed on-call sales are providing support to futures prices. However, the struggling global economy and man-made fiber competition underscore the challenging landscape facing cotton demand. Continue reading

Highlights From the February 2017 Farm Income Forecast

tough net farm income
Farm sector profitability measures are mixed for 2017. A narrow cash-based measure, net cash farm income, is forecast to rise by $1.6 billion to $93.5 billion from the 2016 value, an increase of 1.8 percent. In contrast, net farm income is forecast to decline by 8.7 percent to $62.3 billion, the fourth consecutive year of declines after reaching a record high in 2013. The difference between the two profitability measures is expected to increase in 2017 largely due to an additional $8.2 billion in cash receipts from the sale of crop inventories. The net cash farm income measure counts those sales as part of current-year income while the net farm income measure counted the value of those inventories as part of prior year income. If realized, net farm income in 2017 will be the lowest since 2002, in inflation-adjusted terms. Continue reading

inflation
Overall inflation over the last 12 months increased 2.1 percent, but food prices remain unchanged. The U.S. Bureau of Labor Statistics’ Consumer Price Index for All Urban Consumers was up .3 percent in December, with gasoline prices up three percent. But the food-at-home index fell 0.2 percent, its eighth consecutive decrease that reflects an overall 0.2 percent decrease over the last 12 months. Continue reading

turnaround year
At least one company is predicting 2017 to be something of a turnaround year for farmers. An Ag Web Dot Com article says 2017 could see a “global supply pullback” that may give farmers some relief from lower commodity prices. MetLife Agricultural Finance says, “We expect a recovery in 2017 as global consumption rises and corn and soybean supplies decline.” MetLife does caution that the strength of the U.S. dollar could put a crimp in those predictions as U.S. ag exports could face an obstacle from a strong U.S. dollar that’s at it’s highest level in 14 years. MetLife, a major farm mortgage lender, feels that as farmers cut acreage and supplies drop, prices could rise. U.S. farmers are predicted to cut corn acres by 3.5 percent next year to 91 million acres. MetLife predicts other major corn-producing countries like Brazil and the European Union will likely cut back on corn acres. MetLife also predicts soybean acreage to remain flat next year. The company says huge supplies and low prices are driving demand, expected to rise 4.4 percent.

From the National Association of Farm Broadcasting news service.

farm credit system stress
The Farm Credit System’s quarterly report says stress levels are still high in the ag sector of the economy. In fact, the operating report says stress levels are high in many different sectors of agriculture. Farm debt levels are still high while cash receipts continue to decline. Continue reading

biobased
A new report released Monday by the Department of Agriculture shows the U.S. biobased industry in 2014 contributed $393 billion and 4.2 million jobs to America’s recovering economy. Continue reading

falling food price-check from supermarket
The U.S. is on pace to continue the longest stretch of falling food prices in over 50 years. While the lower prices are a boon to shoppers, it’s putting serious pressure on the farm economy. The Wall Street Journal says reasons behind the lower prices start with excess production in several ag sectors, including dairy, meats, grains, and other staples. Continue reading

Brazil map-confidenceAmid a deep recession and political uncertainty, confidence in Brazil’s agribusiness sector is bouncing back thanks to stronger local commodity prices and healthy margins. DTN reports the IC Agro agribusiness confidence index surged 19.5 points to 102.1 in the second quarter of 2016. Continue reading

rural
The Creighton University Rural Mainstreet Index for July fell from June’s weak reading, according to the monthly survey of bank CEOs in rural areas of a 10-state region within the Midwest dependent on agriculture. Continue reading

Long Term Ag Outlook Strengthens

economic growth outlook
After a volatile June and early July in the commodity markets, agricultural outlooks turned higher in the rest of July. The Purdue University/CME Group Ag Economy Barometer turned higher, coming in at 112 in July, up from 104 in June and 97 in May. Continue reading

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