KC Federal Reserve: Signs Point to Agricultural Recovery

KANSAS CITY, MO – Economic conditions in agriculture improved dramatically in the fourth quarter of 2020 alongside sharp increases in the prices of several major commodities, according to the Federal Reserve Bank of Kansas City. In the latest ag bulletin, the Fed says the surge in the prices of corn and soybeans, supported by robust global demand and relatively tight inventories, helped boost expectations for farm income to the highest mark since 2013. Increased profitability and support from government payments provided significant financial support to U.S. producers, contributed to a further increase in farm real estate values, and may reverse a multi-year trend of increasing financial stress among U.S. farmers. The news comes one year after the U.S. signed a Phase One Trade Deal with China that has led to the largest ag purchases of American commodities by the country in history. Agricultural prices, as a broad index, increased by 10 percent from the previous quarter with a large share of the gain coming from a 17 percent increase for corn and a 15 percent increase for soybean prices.
(SOURCE: All Ag News)