Agricultural Economy

Bloomberg writer Michael Hirtzer reported this week that, “A little-known market, that of young cattle, is signaling that pricey beef could be here to stay awhile.”

At the end of last week, Bloomberg News reported that, “Extreme weather is slamming crops across the globe, bringing with it the threat of further food inflation at a time costs are already hovering near the highest in a decade and hunger is on the rise.”

In an update late last week from the Federal Reserve Bank of Kansas City (“Interest Rates for Operating Loans Rise Slightly From All-Time Lows”), Nathan Kauffman and Ty Kreitman pointed out that, “Interest rates on agricultural loans made by commercial banks increased slightly for some types of lending, but remained historically low through the first half of 2021.”

Reuters writers Emily Chow and Dominique Patton reported this week that, “China’s second-quarter pork production surged to its highest in at least seven years, official data showed on Thursday, after producers launched thousands of new breeding farms last year to rebuild a hog herd decimated by the African swine fever.”

On Wednesday, the Federal Reserve Board released its July 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.

Reuters News reported this week that, “China will no longer require small pig farms to get environmental approval from the government before breeding pigs as the country seeks to rebuild its hog herd following a disease outbreak, the agriculture ministry said on Monday.”

Reuters writer Dominique Patton reported on Friday that, “Large numbers of pigs are dying from African swine fever in China’s top hog-producing province, say farmers and analysts, raising concerns it could spread further across the south and slow China’s pork production recovery.”

Reuters News reported this week that, “World food prices fell in June for the first time in 12 months, pushed lower by declines in vegetable oils, cereals and dairy products, the United Nations food agency said on Thursday.”

Last week, Nathan Kauffman and Ty Kreitman, of the Federal Reserve Bank of Kansas City, penned an update titled, “Farm Debt Declines Further and Credit Stress Eases,” which noted that, “Agricultural debt at commercial banks continued to decline in the first quarter of 2021 and farm loan performance improved.”

A news release this week from the American Bankers Association (ABA) stated that, “Despite the global economic slowdown in 2020 due to COVID-19, total agricultural lending by U.S. farm banks remained strong at $98.6 billion, decreasing by only 1.8% from the year before according to the American Bankers Association’s annual Farm Bank Performance Report.”

Donnelle Eller reported on the front page of Friday’s Des Moines Register that, “Last week, Mark Mueller watched from the porch of his northeast Iowa farm as lightning flashed and a storm dropped badly needed rain a few miles away.”

Bloomberg writers Andy Hoffman and Vanessa Dezem reported this week that, “Two of the world’s top agricultural traders said crop markets are in a ‘mini-supercycle’ that could last half a decade, driven by increased demand for biofuels and continued grains buying from China.”

Wall Street Journal writers Tom Fairless, Alistair MacDonald and Jesse Newman reported on the front page of Tuesday’s paper that, “The run-up in commodity prices is casting a cloud over the global economic recovery, slamming vulnerable businesses and households and adding to fears that inflation could become more persistent.”

Financial Times writer Aime Williams reported on Monday that, “Donald Trump’s trade war with China left American farmers dependent on government handouts to survive. But China is now at the heart of a reversal in farmers’ fortunes, as booming exports and soaring food prices fuel a recovery in the US agricultural economy.”

Late last week, Reuters writer Dominique Patton reported that, “China has come to crave milk. Demand that had been steadily growing has spiked further after doctors touted its health benefits amid the coronavirus pandemic and dairy firms across the country have embarked on a farm-building frenzy.”

Financial Times writer Emiko Terazono reported this week that, “Global food prices surged by the biggest margin in a decade in May as one closely watched index jumped 40 per cent, raising fears of further food inflation later in the year.”

On Wednesday, the Federal Reserve Board released its May 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.

Jacob Bunge reported on the front page of Wednesday’s Wall Street Journal that, “Meatpacker JBS SA was hit by a ransomware attack that took a big chunk of U.S. beef-and-pork processing offline, sending buyers scrambling for alternatives and raising pressure on meat supplies.”

Financial Times writers Chelsea Bruce-Lockhart and Emiko Terazono reported this week that, “The cost of raw materials that go into making breakfast staples have roared higher since the pandemic began — raising fears that a broad commodity boom could push up global food prices for consumers.” 

Bloomberg writer Michael Hirtzer reported on Friday that, “America’s insatiable appetite for ribs and hot dogs pushed hog prices to the highest in nearly seven years as the summer grilling season kicks off.”