For the 19th time in the past 20 months, the overall Rural Mainstreet Index (RMI) sank below the 50.0 growth reading in April, according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.
Overall: The region’s overall reading for April fell to 40.0 from March’s 41.1. The index ranges between 0 and 100, with a reading of 50.0 representing growth neutral.
“The economic outlook for 2025 farm income remains weak, according to bank CEOs. Despite the negative fallout from tariffs, 75% of bankers support the tariffs on China, and 79.2% back the 90-day pause on other tariffs,” says Creighton University’s Dr. Ernie Goss who conducts the survey.
Three of four bankers back the President’s recent substantial increase in tariffs on imports from China. Only one in four support a return to January 1, 2025, tariffs on imports from China. And, only 12.5% of bankers support returning to January 2025 tariff levels on U.S. trading partners.
Approximately 20.8% of bank CEOs recommend the federal government fully offset farmer losses from tariff impositions, while 21.1% argue for no increase in federal support.
Farming and ranch land prices: For the 11th time in the past 12 months, farmland prices slumped below growth neutral. The region’s farmland price index increased to 41.7 from 38.9 in March. “Elevated interest rates, higher input costs and volatility from tariffs have put downward pressure on ag land prices,” notes Goss.
Farm equipment sales: The farm equipment sales index dropped to a very weak 17.4 from 20.8 in March. “This is the 20th straight month that the index has fallen below growth neutral. High input prices, tighter credit conditions and market volatility from tariffs are having a negative impact on the purchases of farm equipment,” observes Goss.
Confidence: Rural bankers remain pessimistic about economic growth for their area over the next six months. The April confidence index increased to a weak 36.0 from March’s 30.4. “Weak grain prices and negative farm cash flows, combined with downturns in farm equipment sales over the past several months, pushed banker confidence lower,” says Goss.
Creighton University says the survey represents an early snapshot of the economy of rural agriculturally -- and energy-dependent portions of the nation. The RMI covers 10 regional states, focusing on approximately 200 rural communities with an average population of 1,300.