2022 ag outlook strong, but rural bankers still concerned
While the economic outlook is good for farmers this year, economists say that there are areas of concern.
Higher input costs, weak loan demand, and severe drought all have the attention of rural bankers. The Kansas City Federal Reserve calls the current outlook a paradox.
“It’s very interesting to see this juxtaposition or paradox of really strong conditions but also concerns about inflation, higher input costs. So, farm balance sheets are strong. There’s a willingness to spend farm working capital but higher input costs are an issue. There’s a lack of things to buy, and so that’s been a constraint. Drought still seems to be a significant issue in a lot of parts of the country, both the north and western United States,” according to Cortney Cowley.
She adds that there is some pressure coming from ag lenders and that we are currently in one of the strongest periods for the ag sector in some time.