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Rural Mainstreet Index Halts To Neutral Growth In August, KS and MO Indexes Sink

Creighton University's August Rural Mainsheet Economy Index shows a decrease of growth for the region, leveling out to a neutral-growth.

Posted August 17, 2023

Creighton University released its Rural Mainstreet Index (RMI) report for August showing the region slumped to growth neutral and both Kansas and Missouri experienced drops in the month.

After four straight months of above-growth neutral readings, the RMI decreased to growth neutral, 50.0, in August.

The index ranges between 0 and 100, with a reading of 50.0 representing growth neutral.

“This is the fifth consecutive month that the overall RMI has moved at or above growth neutral. However, I expect recent pullbacks in growth to push the Federal Reserve to forgo an interest rate increase at its next meetings on September 19-20,” Ernie Goss, Ph.D. at Creighton University said.

The Kansas RMI for August decreased to 51.1 from July’s 55.2.

Kansas’ farmland-price index declined to 59.2 from 63.4. The new-hiring index for Kansas advanced to 59.0 from July’s 58.3. According to data from the International Trade Association, Kansas’ agriculture exports contracted from $1.30 billion in the first half of 2022 to $642 million for the same period in 2023 for a 50.5 percent slump.

Missouri’s August RMI dropped to 37.5 from 42.7 in July.

The farmland-price index decreased to 55.4 from 59.9 in July. Missouri’s new hiring gauge slumped to 46.9 from 53.9 in July. According to data from the International Trade Association, Missouri’s agriculture exports contracted from $671 million in the first half of 2022 to $627 million for the same period in 2023 for a 6.6 percent slump.

More key insights from the August survey:

  • Farmland cash rents are expected to expand by 1.3% over the next year.
  • Less than one-third of bank CEOs expect a “soft landing” for the economy. Approximately one-third anticipate a “hard landing,” or negative growth from Federal Reserve rate hikes.
  • Bankers reported continuing record-low deposits.
  • Only 14.8% expect a stronger farm economy one year out. Almost one-half, or 48.2%, forecast a weaker farm economy 12 months out.
  • The region’s agriculture exports contracted from $8 billion in the first half of 2022 to $6.8 billion for the same period in 2023 for a 14.6% slump.