Weak commodity prices continue to hurt farms and hamper growth in rural economies, but new industry reports show some signs of improvement in agriculture, fueled by discussions over federal tax and regulatory reform, and increasing sales as farmers replace aging equipment.
Policy experts are hopeful the momentum will continue, especially if Congress makes sound decisions regarding farm policy, which provides a foundation for the rural economy. But, there's still a long way to go.
Creighton University's Rural Mainstreet Index remained below growth neutral, according to its May report. The index, released on May 18, was 44.6. Anything above 50 is considered economic growth. The last time the overall index was at or above growth neutral was August 2015.
Economic activity in agriculture varied across the report's 10-state region. Illinois, Missouri and Nebraska all saw increases in economic markers while others states saw decreases with Wyoming remaining unchanged.
"It's a mixed bag out there right now," explained Larry Combest, the former Chairman of the House Agriculture Committee. "Good crops last year have helped many farmers out, but they are right on the edge and it is high stakes. A lot of guys are still struggling mightily with low prices and bad weather. Others are starting to see some improvement and despite detached budgets and the political flack, they are excited about what they're hearing in Washington."
Combest said one of the best ways to help all growers turn the tide is by combining legislative certainty on the farm policy front with lower taxes and continued reductions in regulatory burdens.
Source: www.farmpolicyfacts.org