Mainstreet Survey Index shows strong ag growth, inputs as top concern
The latest Rural Mainstreet Index says despite skyrocketing input prices the overall outlook for the ag economy in 2022 is positive.
Ernie Goss is an economist with Creighton University. “The overall reading was down a bit from last month but still within in range indicating healthy growth for the rural areas dependent on agriculture and energy.”
The monthly survey of bank CEOs in rural areas of a 10-state region showed the index moved above growth neutral for the 14th straight month.
Goss tells Brownfield the growth is driven by increases in commodity prices and farm income and that has contributed to “our farmland prices are growing at a very strong pace. In fact, the strongest pace we’ve seen farmland price growth in the 10-state region along with agricultural equipment sales looking very good.”
Goss says over the last several months, surveys have recorded the fastest pace of agricultural equipment sales since the Spring of 2011.
But, he says bank CEOs overwhelmingly named rising input prices and product shortages like fertilizer the top farm threat. “That’s really causing some issues for the agricultural sector, of course principally grain producers.”
Goss says bank CEOs expect the Federal Reserve to raise short-term interest rates by 0.70% in 2022.