Midwest Economy Struggling

Aug 16, 2016

Credit SDPB

One survey on the Midwestern economy shows one in five farmers may have expenses exceeding revenue this year.

The report blames falling farm prices.

The Rural Mainstreet Index shows farm prices have decreased 9% over the last year. The study surveys bank CEOs across the Midwest about economic conditions. Ernie Goss is the Economics Chair at Creighton University. He says multiple agriculture sectors are really struggling.

“All of this can be traced back of course to weak agriculture commodity prices, with are down by less than 50% of what they were three to four years ago. And recently they’ve weakened a little bit again whether it’s corn prices, wheat prices and even on the livestock side the numbers have not been strong and that’s pulling down the agricultural economy,” says Goss.

But Goss says South Dakota markets are doing well compared to the rest of the region.

“In South Dakota some of the prices have held up a little bit better, in terms of agricultural commodity prices. And also the financial services even that is a principally in urban areas some of those impacts are spilling over into the rural areas so not quite as weak in South Dakota. And again some of the crop and livestock haven’t been as negatively impacted,” says Goss.

Goss says the US dollar’s strength continues to hinder agriculture. He says large events like Brexit do not help the situation.