Uncertainty continues across Corn Belt

CHICAGO — Agricultural conditions across the Corn Belt are strained in part due to concerns about China's elimination of soybean purchases and low crop prices, according to a Federal Reserve survey.

A summary of commentary on current economic conditions was published in the Federal Reserve District's Beige Book Oct. 15, reflecting activity since early September based on information collected on or before Oct. 6.

Each Federal Reserve Bank gathers information on current economic conditions in its 12 districts through reports from bank and branch directors, plus interviews and online questionnaires completed by businesses, community organizations, economists, market experts and other sources.

Here are what the Corn Belt districts reported regarding the agricultural conditions.

Chicago

Net farm income prospects for the Seventh District were unchanged over the reporting period, though elevated uncertainty continued to unsettle agricultural operators.

"Corn and soybean fields were in good shape across most of the district. Dry conditions assisted harvest, but hurt yields in some places; in addition, crop disease trimmed yields a bit. Fruit and vegetable production was subpar for most products," the report stated.

Soybean prices were lower, in part due to the absence of new-crop exports to China. Corn prices were down despite strong export volumes.

Cattle and hog prices increased to record territory, while milk and egg prices declined.

"Concerns about higher input costs for 2026 intensified due to rising fertilizer prices. Farm operations, particularly crop producers, have already cut costs, with a contact saying, 'there is limited flexibility left to further reduce expenses,'" according to the report.

Contacts noted that lack of clarity on the economic outlook was putting a damper on capital investment, such as equipment purchases and repairs.

The Seventh District of Chicago includes the northern two-thirds of Illinois and Indiana, all of Iowa, the southern two-thirds of Wisconsin and Michigan's Lower Peninsula.

St. Louis

Eighth District agriculture conditions are strained and have further deteriorated. In addition to high input costs and low commodity prices, recent adverse weather conditions have resulted in lower quality of crops.

A contact in west Tennessee reported that 2025 has been extremely challenging for agriculture due to extreme weather and poor crop conditions, especially for non-irrigated fields.

Contacts continue to express that government support will be a critical lifeline for many farmers; however, they noted that some payments may come too late.

"A farmer in Arkansas estimated that up to one-third of Arkansas farmers may go bankrupt or exit the industry to avoid losing land or homes. On the other hand, contacts in the protein business reported that demand for protein continues to be very strong, with volume sales showing year-over-year growth and with labor being the main constraint to expansion," the Beige Book noted.

The St. Louis Federal Reserve District includes the southern parts of Illinois and Indiana and eastern half of Missouri, as well as parts of Tennessee, Arkansas, Kentucky and Mississippi.

Minneapolis

Agricultural conditions weakened in the Ninth District since the previous report.

Corn production in district states was expected to set new records, and soybean harvests were very strong, as well, but low crop prices and elevated expenses were weighing down producer incomes.

Contacts were extremely concerned about the impacts of China's decision not to order soybeans from U.S. producers.

The Minneapolis-based Ninth District includes all of Minnesota, the Dakotas and Montana, the northern one-third of Wisconsin and Michigan's Upper Peninsula.

Kansas City

Disparities in the Tenth District agricultural economy persisted through the end of September. Profit opportunities for crop producers remained weak while conditions in livestock industries were considerably stronger, particularly for cattle producers.

In a recent survey, over 80% of lenders in crop-heavy areas reported declines in farm income and working capital, compared to about 40% in areas with more cattle production.

Agricultural credit conditions deteriorated gradually, and many lenders reported that weak conditions in the farm economy were having a modest negative effect on local economic conditions.

Contacts remarked that strong cattle prices were supporting diversified operations, but the weakness in crop profits was weighing heavily on farmer sentiment.

The Kansas City district includes the western part of Missouri, Kansas, Nebraska, Oklahoma, Wyoming, Colorado and northern New Mexico.