Agricultural Economy

A news release Tuesday from the Center for Agricultural and Rural Development at Iowa State University and Iowa State University Extension and Outreach indicated that, “After several years of modest gains and losses, the average value of an acre of Iowa farmland skyrocketed 29% in 2021.”

In its monthly Oil Crops Outlook report this week, the USDA’s Economic Research Service (ERS) indicated that, “U.S. processors crushed a record 197 million bushels of soybeans in October, nearly 0.5 million bushels higher than the record established in October 2020.”

Last week, the USDA’s Economic Research Service (ERS) released its annual report exploring characteristics of U.S. farms: “America’s Diverse Family Farms: 2021 Edition.”

DTN writer Russ Quinn reported last week that, “Average retail prices for most fertilizers continued to rise at a good clip the first partial week of December 2021, according to sellers surveyed by DTN. Once again, the nitrogen fertilizers maintained their spot as the clear leaders.”

Washington Post writer Rachel Siegel reported last week that, “Prices rose at the fastest pace in nearly 40 years last month, increasing 6.8 percent over the same period a year ago, as inflation continues to squeeze households and businesses nationwide and complicates the political environment for Congress and the White House.”

In an update earlier this month from the Federal Reserve Bank of Kansas City, “Limited Demand for Farm Loans, But Strong Profits for Ag Banks,” Nathan Kauffman and Ty Kreitman stated that, “Agricultural lending at commercial banks continued to decline but showed some signs of stabilizing in the third quarter.”

New York Times writer Raymond Zhong penned an article this week discussing market factors associated with urea, and pointed out that, “[Prices] are soaring to levels not seen in over a decade.”

DTN writer Russ Quinn reported last week that, “Nitrogen fertilizers maintained their spot as the clear leaders as average retail fertilizer prices continued to climb higher the fourth week of November 2021, according to sellers surveyed by DTN.”

Bloomberg writer Grace Gitau reported last week that, “Food prices climbed closer to a record high, giving consumers and governments around the world an even bigger inflation headache.”

On Wednesday, the Federal Reserve Board released its November 2021 Beige Book update, a summary of commentary on current economic conditions by Federal Reserve District. The report included several observations pertaining to the U.S. agricultural economy.

The USDA’s Economic Research Service (ERS) indicated on Wednesday that, “Net farm income, a broad measure of profits, is forecast to increase by $22.0 billion (23.2 percent) from 2020 to $116.8 billion in 2021. This expected increase follows a forecast increase of $15.7 billion (19.9 percent) in 2020.”

Last week, Reuters writer Rod Nickel reported that, “A global shortage of nitrogen fertilizer is driving prices to record levels, prompting North America’s farmers to delay purchases and raising the risk of a spring scramble to apply the crop nutrient before planting season.”

In an update last week from the Federal Reserve Bank of Kansas City, “Farm Real Estate Values Rise Sharply,” Nathan Kauffman and Ty Kreitman stated that, “Farmland values surged in the third quarter according to Federal Reserve Surveys of Agricultural Credit Conditions.”

Bloomberg writer Elizabeth Elkin reported on Friday that, “World fertilizer prices continue to soar as tightening supplies send costs up for farmers and consumers across the globe.”

In an article last week from the Federal Reserve Bank of Minneapolis, “Even with severe drought and supply chain woes, farms remain in good financial shape,” Joe Mahon pointed out that, “A year into a tenuous recovery in agriculture driven as much by government support as by market conditions, widespread and severe drought could be expected to be a major setback.”

On Monday, the Federal Reserve Banks of Chicago and Kansas City released updates regarding farm income, farmland values and agricultural credit conditions from the third quarter of 2021.

Last week, DTN writer Katie Micik Dehlinger reported that, “The average retail price of anhydrous set a record this week at $1,113/ton after increasing 38% from last month.”

In its November Wheat Outlook report on Friday, the USDA’s Economic Research Service (ERS) indicated that, “The 2021/22 Season-Average Farm Price (SAFP) is raised 20 cents per bushel to $6.90 based on the continued strong farmgate prices as reported in the October 29 National Agricultural Statistics Service (NASS) Agricultural Prices report as well as rising futures and cash prices.”

Bloomberg writer Megan Durisin reported last week that, “Global food costs jumped last month, extending a march toward a record and piling more inflationary pressure on consumers and governments.”

Late last week, Bloomberg writer Elizabeth Elkin reported that, “A gauge of North American fertilizer prices touched a new record high, driving up costs for farmers who are already experiencing tight margins and threatening to make food even more expensive.”