Rural Mainstreet Index hits lowest level since December 2016 - Entrepreneur Generations

"The latest Rural Mainstreet Index (RMI) is revealing a drop in farmers’ financial conditions, sinking to the lowest level since December 2016. The index remained below growth neutral, a sign that shows financial pressure continues to prevail on farms and ranches," AgWeb reports. The RMI is calculated by Creighton University by surveying bank CEOs in rural areas of a 10-state region where agriculture and energy are critical to the economy.

Creighton University graphic; click to enlarge it.

The 2017 corn crop is looking to be the third-highest ever at 169.9 bushels per acre, but the drought has sapped yields for many other crops. Though scarcity might normally bring higher prices for crops that make it to harvest, that's not happening here because of the ready supply of crops on the global market. Ernie Goss, author of the RMI, says those global supplies are keeping American farmers from rallying. "A lot of farmers have grain in the bins," said Goss. "If prices go up, you get some unloading that sort of limits any growth until we get rid of that old crop corn." A weakened dollar could help American crops look more attractive to international buyers in the long run, but for now farmers are still struggling.

Creighton University graphic; click to enlarge it.

The financial stress is reflected in the farm loans figures: "51.2 percent of bank CEOs reported restructuring farm loans. 18.6 percent of that same group also indicated they had to increase collateral requirements," AgWeb reports. Farm loan delinquencies are up 4.1 percent too. The good news is that despite four straight years of declining farm income, farm loan defaults only increased 2.1 percent this past year.

from The Rural Blog http://ift.tt/2wGApoV Rural Mainstreet Index hits lowest level since December 2016 - Entrepreneur Generations

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