Economic optimism low among Midwest bankers, supply managers; North Dakota exports down

Rural bankers in the Midwest and Plains region are bracing for a disappointing season in the agriculture industry, while supply managers say uncertainty surrounding tariff impacts is a big challenge to economic optimism.

Creighton University's Mid-America Business Conditions survey of supply managers in March climbed to 56.7, up from 52 in February and to the highest level since July 2022 — and for the third straight month was above growth-neutral. Any readings above 50 on the index that ranges from 0 to 100 suggests economic growth in the months ahead, with readings below 50 indicating decline. The survey's confidence index, which looks ahead six months, plummeted to 37.5, however — down from February's 45.7 and its lowest level since last September.

The survey "is recording significant volatility, much like other regional economic measures," said Creighton economist Ernie Goss, who oversees the survey. "Proposed and implemented tariffs are not only producing economic volatility but are damaging supply managers’ economic outlook."

Creighton's Rural Mainstreet survey of rural bankers in March increased to what Goss termed a "weak" 41.1 from February's 38. It was the 18th time in the past 19 months that the reading was below growth-neutral.

“The economic outlook for 2025 farm income remains weak according to bank CEOs," Goss said. "However, farm commodity prices have recently improved, but not enough for profitability among a high share of producers.”

The survey's confidence index sank to 30.4 from February's 40.

“Weak grain prices and negative farm cash flows, combined with downturns in farm equipment sales over the past several months, continued to push banker confidence lower,” Goss said.

The Rural Mainstreet survey measures rural bankers in Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota and Wyoming. The Mid-America Business Conditions survey measures supply managers in Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.

North Dakota data

North Dakota's overall index in the Mid-America survey was above growth-neutral for a ninth consecutive month, at 59, up from 55.1 the previous month. Components were: new orders at 56.2, production or sales at 55.8, delivery lead time at 57.8, employment at 52.0 and inventories at 52.0.

The North Dakota economy began the year with $366.8 million in manufacturing exports, compared to $402.8 million for the same period in 2024, for an 8.9% reduction, according to U.S. International Trade Administration data.

North Dakota's overall index in the Rural Mainstreet survey dropped from 49.8 in February to 40.3 in March. The state’s farmland price index slumped to 38.6 from 45.6 in February; its new hiring index expanded to 51.8 from 46.2 the previous month.

North Dakota exports of agriculture goods and livestock for the first month of 2025, compared to January 2024, fell by $13.4 million for a decline of 15.1%. Mexico was the top destination to begin 2025, accounting for 43% of the state's January agriculture and livestock exports, according to ITA data.

The full Rural Mainstreet report is at https://bit.ly/407AAGn. The full Mid-America report is at bit.ly/3SavggB.

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