Inflation
Scott Varilek with Kooima Kooima Varilek says $243 was the line in the sand for the June live cattle or funds would liquidate and it held after Brooke Rollins canceled her trip to Arizona which alleviated fears of a border reopening.
While inflation remains above the Federal Reserve’s target of 2%, the outgoing president and CEO favors a pause on interest-rate reductions while noting AI’s potential to shift labor needs
Farm economists say today’s ag slowdown “isn’t a collapse, but it’s a grind.” From trade woes to rising costs and consolidation, experts warn recovery could take time, even as livestock markets stay strong.
On the surface, strong livestock prices and government payments are painting a rosy picture for the farm sector. A closer look at input costs, commodity prices and interest rates says otherwise.
The March Ag Economists’ Monthly Monitor asked economists if they think the U.S. general economy will see a recession in 2025. 62% said yes.
Trump recently signed three executive orders imposing tariffs on Canada, Mexico and China. This marks the first time a president has used powers granted under the International Emergency Economic Powers Act of 1977.
Yes, the Fed is cutting interest rates but the agency can only influence mid- and long-term rates. Concerns about inflation are pushing those rates back up again.
Agriculture can sometimes act as a buffer during broader economic recessions, as demand for essential food items tends to remain relatively stable. However, when multiple indicators align in the industry, it can signal a recession.
The report from the Labor Department on Wednesday added to a mild increase in producer prices in July in suggesting that inflation was firmly back on a downward trend. That should allow the U.S. central bank to focus more on the labor market amid growing concerns of a sharp slowdown.
Recessions often lead to decreased demand for certain agricultural products, particularly those considered discretionary, such as cotton, dairy, specialty meat products and vegetables. This can result in lower prices for these commodities, affecting farmers’ revenues.
A new Kansas City Fed report shows farm incomes continued to weaken, particularly in crop-heavy states like Kansas, Missouri, and Nebraska, while cattle prices provided some support.
Top Federal Reserve officials said on Wednesday the U.S. central bank is “closer” to cutting interest rates given inflation’s improved trajectory and a labor market in better balance, remarks that set the stage for a first reduction in borrowing costs in September.
New research finds the surge in grocery prices was driven mainly by substantial increases in commodity prices and supermarket wages, rather than price gouging.
The Federal Reserve has four more chances this calendar year to cut interest rates. Since July 2023, the system has kept its benchmark interest rate steady at a 23-year high of 5.25% to 5.5%.
The May Ag Economists’ Monthly Monitor found even with improved commodity prices over the past month, ag economists’ views on the net farm income picture slightly eroded, falling to $110.4 billion in May.
From the election to world trade, as well as geopolitical factors that have the potential to shape agriculture in 2024, the December Ag Economists’ Monthly Monitor shows the possibility of several economic surprises.
Farmers are opting to tap into their savings from recent prosperous years instead of taking out loans at the highest interest rates since 2007, according to surveys conducted by regional Federal Reserve banks.
While ag economists continue to be at odds when it comes to the likelihood of a recession in the U.S., some doubt the country’s biggest importers will be able to avoid a recession over the next 18 months.
For 2024, USDA projects that food price inflation will be lower than that seen in 2023 and significantly lower than the rise seen in 2022.
Meanwhile, service prices and the core index (which excludes food and energy) remain high, with the core CPI descending to 4.8%.
The CPI for May shows egg prices experienced the largest monthly drop in 72 years, but the price consumers are paying for a dozen eggs is still well above average over the past 10 years.
A study released by Farm Bureau finds 86% of Americans are concerned about food insecurity, but their trust in farmers remains high at 89%.
The end of the year is closing in. Have you considered new prepaid expense moves? According to Paul Neiffer, farm CPA at CLA Connect, you should.
Global inflation will likely decrease to 6.5% in 2023 and to 4.1% by 2024, according to the International Monetary Fund (IMF) forecast.
As consumers see increased prices at the store in many counties across the globe, decreasing import tariffs has helped make food more affordable and increase opportunities for exporting markets.
USDA raised its consumer food price forecast again, to 8.5% to 9.5% for 2022. The agency had initially predicted a 2% to 3% rise in prices. Eggs, fats and oils, and poultry prices are making the biggest gains.
From record-high gas and diesel prices on the road to a major spike in the price Americans paid for their Memorial Day weekend barbecue essentials, shoppers are seeing price spikes everywhere they go.