U.S. Midwest farm incomes fall in second quarter in wake of record floods
P.J. Huffstutter, Reuters†
August 8, 2019
CHICAGO, Aug 8 (Reuters) - U.S. farm incomes in the Midwest declined yet again in the second quarter of 2019, as record floods devastated a wide swath of the Farm Belt, according to a banker survey released on Thursday by the Federal Reserve Bank of St. Louis.
Nearly two-thirds of the bankers surveyed said a majority of their farm customers were either significantly or modestly impacted by the flooding and other adverse weather earlier this year.
The floods added more pain on farmers who have also been hurt by low crop prices and the trade war between Washington and Beijing, which has slashed shipments of U.S. agricultural products to China. The floods also battered earnings for global grain traders Cargill Inc and Archer Daniels Midland Co, as heavy rains halted barge traffic on the Mississippi River, disrupted cattle shipments and caused some plants to be shuttered.
The second quarter marked the 22nd consecutive quarter for farm incomes dropping in the Eighth Federal Reserve District, which includes all or parts of seven Midwest and Mid-South states: Arkansas, Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee.
It was the highest proportion of bankers in more than three years who reported that farm income had declined among their customers, according the St. Louis Fedís survey.
The weak trend is expected to continue in the third quarter, dragged down by the ongoing trade fight between the United States and China, problems with crop production and depressed commodity prices, bankers said.
Farm household spending and farm capital expenditures...