CHICAGO — Weather continued to draw concerns from Federal Reserve Districts survey respondents across the Midwest.
The Beige Book publication reflects the current economic conditions across 12 Federal Reserve Districts based on information collected on or before July 8.
“More wet weather in late May and June caused further delays in planting and even poorer growing conditions. One contact in Indiana said, ‘I have been farming for 48 years now and this is the worst spring/summer planting season we have experienced,’” according to the Seventh Federal Reserve District of Chicago survey, which includes the northern two-thirds of Illinois and Indiana and all of Iowa, Wisconsin and Michigan.
“Because it is now too late to plant corn and soybeans, contacts said that many farmers would be forced to make insurance claims and plant less-profitable cover crops.
“Corn and soybean prices moved up as expected yields for the fall harvest declined. Egg and dairy prices increased, while hog and cattle prices decreased. Contacts noted that struggling dairy operations were slaughtering more cows, which contributed to the lower cattle prices.”
Eighth Federal Reserve District of St. Louis agriculture conditions have declined modestly since the previous reporting period and have deteriorated moderately relative to a year ago. The district includes the southern parts of Illinois and Indiana and eastern half of Missouri, as well as parts of Tennessee, Arkansas, Kentucky and Mississippi.
“Compared with one month prior, the percentage of corn and cotton rated fair or better at the end of June declined modestly, the percentage of soybeans rated fair or better declined slightly, and the percentage of rice rated fair or better increased slightly,” The Eighth District report stated.
“The percentages of all four crops rated fair or better were moderately below those from the same time last year. Contacts have frequently attributed the decline in crop quality to the historic flooding along the Mississippi River this spring.”
In the Federal Reserve District of Minneapolis, agricultural conditions worsened from an already weak position. Heavy rainfall and flooding substantially delayed crop planting in many areas of the district.
In some areas of the Minneapolis district farmers switched from corn to soybeans or other crops that could start growing later, while in other areas crops did not get planted at all. Contacts in affected areas expressed concerns that the impacts could be severe.
The Minneapolis district includes all of Minnesota, the Dakotas and Montana, northwestern Wisconsin and all of Michigan’s Upper Peninsula.
The Federal Reserve Bank of Kansas City reported its farm economy remained weak, and delayed planting and harvesting could reduce crop production considerably in some states. Weather conditions led to unprecedented delays in corn and soybean planting in some areas of the region.
Wheat harvest in the Kansas City district was also delayed considerably in Oklahoma, Missouri and Kansas. In late June, the percentage of wheat acres harvested in those three states was less than half of the previous year.
“While expectations of lower U.S. crop production led to sharp increases in prices over the period, uncertainty about the total number of planted crop acres remained. Weather conditions may also reduce the quantity of planted crops, which could dampened revenues for some producers,” according to the Kansas City district’s survey respondents.
The Kansas City district includes the western part of Missouri, Kansas, Nebraska, Oklahoma, Wyoming, Colorado and northern New Mexico.