NICK GOSNELL Hutch Post
HUTCHINSON, Kan. — Creighton University economist Ernie Goss told Hutch Post that his Rural Mainstreet survey is still showing weakness in the economy for this part of the country.
"This is a survey of bank CEOs in rural areas of 10 states, including Kansas, right down the middle, mid-section of the country," Goss said. "The overall rating for July was not good. In fact, this is the lowest that we've recorded this year, and it's certainly down from this time last year. And what we're seeing is just the rural Main Street economy, driven a lot by agriculture and energy, just not holding up very well."
You can see this in layoffs at implement manufacturers across the Midwest.
"Farm equipment sales, as reported by the banks,bank CEOs, are down for the 12th straight month," Goss said. "Of course, you look at John Deere, which has some fairly significant layoffs in Iowa, particularly, and other firms that are linked to agriculture. Farmers are struggling because of high interest rates and lower agricultural commodity prices. Likewise, exports are not holding up very well. In fact, we're down from this time, same time last year. That's having some negative impacts. So all in all, it has not been good. And the USDA isprojecting 2024 farm income is going to be down from 2023."
It may not get better for quite some time.
"We have a confidence index which tracks the economic outlook six months out," Goss said. "That's not good. Again, we're talking about high borrowing costs for the farmer. We're talking about weather related issues. We're talking about agricultural commodity prices, for example, corn around $4 a bushel depends on where you're selling it and what time frame you're looking at, but that's below break even for a lot of the farmers out there in the region."
Over half of rural mainstreet bankers see a recession as the greatest risk for the region over the next 12 months.