News

September Rural Mainstreet Index falls to lowest level since 2020

An ag economist says the Rural Mainstreet Index (RMI) fell in September to its lowest level since spring 2020.

Ernie Goss with Creighton University tells Brownfield…

“We’ve got an increase in supply pushing down, particularly grain prices, principally soybean, corn and wheat in this part of the country,” he says.

The region’s overall reading was 37.5 in September, down from 40.9 in August. The index is a monthly survey of ag bankers in 10 states including Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, and South Dakota. The index ranges from 0 and 100, with a reading of 50.0 that represents growth neutral.

Goss says the federal government’s announcement of interest rate cuts will make it easier to borrow and reduce the value of the dollar.

“That would make US agricultural goods more competitively priced abroad,” he says.

Goss says about 40% of farmers surveyed are expected to lose income in 2024. 

“I expect that to turn a little bit more positive with these lower interest rates, but there’s no doubt that these prices are just inconsistent with positive income,” he says. “For most farmers in terms of grain, these prices are below break even.”

Farmland prices also fell for the fourth time in the past five months.

It’s the 13th consecutive month the RMI has been below the growth neutral rate.