For the sixth time in 2025, the overall Rural Mainstreet Index (RMI) sank below growth neutral 50.0, 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 August fell to 48.1 after rising above growth neutral to 50.6 in July and 51.9 in June. The index ranges between 0 and 100, with a reading of 50.0 representing growth neutral.
“Weak agriculture commodity prices for grain producers continue to dampen economic activity in the 10-state region. Bank CEOs and chief loan officers expect almost one-fifth, or 19.5%, of grain farmers to experience negative cash flow for 2025. This is unchanged from January of this year, when approximately one-fifth of grain farmers were expected to experience net losses,” says Creighton University’s Dr. Ernie Goss.
According to Jeff Bonnett, Havana National Bank in Havana, Ill., “As current prices for corn and soybeans are still below break even, the majority of producers in our area will struggle to show operational profitability.”
Farming and ranch land prices: For the 15th time in the past 16 months, farmland prices slumped below growth neutral. The region’s farmland price index dropped to 46.2 from 47.9 in July. “Elevated interest rates, higher input costs and volatility from tariffs have put downward pressure on farmland prices,” states Goss.
Jim Eckert, Anchor State Bank in Anchor, Ill. comments, “The corn crop in central Illinois is the tallest I’ve seen in 50-plus years in a farm bank. However, rain came after prime pollenating time, so yields will not be as good as last year. The soybean crop should be better than last year.”
Farm equipment sales: The farm equipment sales index slumped to a very weak 14.6 from 16.7 in July. “This is the 24th straight month the index has fallen below growth neutral. High input costs, tighter credit conditions, low farm commodity prices and market volatility from tariffs are having negative impacts on the purchases of farm equipment,” notes Goss.
Despite weakness in the farm-based economy, bankers continue to report little change in farm loan payments, delinquencies and bankruptcies. On average, bankers report a 1.2% increase in farm loan delinquencies and bankruptcies over the past six months. This rate has changed little since 2023 when farm income began to decline.
Confidence: Rural bankers remain pessimistic about economic growth over the next six months. The August confidence index weakened to 27.8 from 36.0 in July.
The RMI is a unique index covering 10 regional states, focusing on approximately 200 rural communities with an average population of 1,300. The index provides the most current real-time analysis of the rural economy, Creighton University states.