Input Prices Greatest Threat for 2022

The Latest Rural Mainstreet Index shows rising input prices as the top threat in 2022 for farmers. Released Thursday, the index declined in January, though it remained above growth neutral for the 14th straight month. Overall, the region’s reading for January fell to 61.1 from December’s 66.7. The index ranges between 0 and 100, with a reading of 50.0 representing growth neutral. The region’s farmland price index decreased to a very strong 88.5 from December’s record high of 90.0. This month, bankers were asked to identify the greatest 2022 risk for farmers in their area. Bankers overwhelmingly named rising farm input prices, such as fertilizer, as the top farm threat. Bankers ranked disruptions of the delivery of farm inputs and rising interest rates as the second and third greatest 2022 threats to farm operations. However, one Iowa banker says, “Increased input costs have raised our average farmer break even points, but current commodity prices still produce moderate gains in all areas of financial statements.”

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