Midwest Farmers Incomes Fall In Second Quarter
The record quarter of 2019 shows that U.S. Farmers have a declining income again. Hardest hit are those farmers in the farm belt. A large area of the farm belt have been deluged with repleteness rains that have created huge gaps in the growing season.
The Federal Reserve Bank of St Louis released their incoming findings on Thursday. The report sites that 2/3 of their banks say their farmer customers have been impacted by the rains and other weather events. The hits these farmers have taken in 2019 seems never ending.
As they struggle to recover from a shortened planting seasons and constant trade war issues, many are fearful for their futures. Grain traders have suffered substantial losses in the quarter as well. Grain traders,Cargill Inc. (CARG.UL) and Archer Daniels Midland (ADM.N) have had record problems this year. The heavy and sometimes non stop rain completely stopped barge movements on the Mississippi River. Cattle shipments were routinely disrupted which caused several plants to stop working.
This Is The 22nd Consecutive Quarter That Posted Substantial Losses For Farmer Incomes
These dropped income levels are in the, Eight Federal Reserve District, which encompasses seven Mid-West and Southern states. Farmers in Arkansas, Tennessee, Missouri, Mississippi,Illinois,Indiana, Kentucky all suffered substantial drops in their incomes.
St. Louis Fed Survey, these latest findings are the highest amount of bankers that report their farming clients are financially suffering. The bankers reported on Thursday that they didn’t expect the farmers to recover in the foreseeable future. They expected income losses for farmers in the third quarter as well.
The bankers said that the ongoing trade wars between the U.S. and China ‘is like putting another nail in their coffins.’ Bankers and other experts are very concerned about the ripple effect of this less than stellar news.
The report also indicted that overall farming households are spending less money, than the same time last year. It was also revealed that basic spending for farm equipment and other related business expenses were way down.
Household Spending & Farm Expenditures Are Closely Related To Farm Income
Experts are saying with the fall harvest about to be here, there could be some gains for farmers. Experts advise, it’s really too early too tell what the financial outlook will be.
The news is not all negative, the declining incomes for farmers is slowing ever so slightly. Crop prices came in a little higher in the second quarter, so that could increase incomes in the third quarter.
The Department of Agriculture (DOA) announced that the Market Facilitation Program will continue in 2019. That is a program that is in place to assist farmers during the trade wars.
The DOA’s announcement of the continued program was announced on Thursday. That program could propel the farmer incomes in a positive directions. Experts say a lot of income amounts will be in the hands of ‘mother nature. If we get a reprieve farmers say, all is not lost yet.