Iowa Goss Index Drops 5.2 Points – Tariff Impact Report
- Here's a summary of the key takeaways from the Rural Mainstreet Index released on Thursday:
- * The Rural Mainstreet Index fell below growth neutral for the seventh time in 2025, indicating economic contraction.
- * Farmland Prices: Decreased for the 16th time in the last 17 months (index at 45.8).
Rural Mainstreet Index Signals Economic Weakness in the Midwest – September 2025
Here’s a summary of the key takeaways from the Rural Mainstreet Index released on Thursday:
Overall Economic Trend:
* The Rural Mainstreet Index fell below growth neutral for the seventh time in 2025, indicating economic contraction.
* The overall September reading was 38.5, down from 48.1 in August. (A reading of 50.0 represents growth neutral).
Key Negative Indicators:
* Farmland Prices: Decreased for the 16th time in the last 17 months (index at 45.8). Factors include elevated interest rates, high input costs, and low grain prices.
* Tariffs: Approximately three-quarters of bank CEOs reported negative impacts from tariff increases on farm operations.
* farm Equipment Sales: Remained weak, falling below growth neutral for the 25th consecutive month (index at 15.2). Contributing factors include high costs, tight credit, low commodity prices, and tariff volatility.
* Commodity Prices: Falling agriculture commodity prices were identified as the biggest threat to banking operations over the next year by almost three-quarters of bank CEOs.
* Loan Volume: Declined to 70.0 from 82.7 in August.
* Checking Deposits: Fell to 54.0 from 63.5 in August.
Regional Context:
* The 10-state region covered by the survey produces 36.9% of U.S. agriculture output (based on 2024 USDA data).
* Harvests are beginning, with initial indications suggesting corn yields may be lower than in 2024 due to dry weather.
Expert Commentary:
* Ernie Goss (Creighton University): Weak agriculture commodity prices are continuing to dampen economic activity. Elevated interest rates, higher input costs and below breakeven grain prices put downward pressure on farmland prices. 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.
* Jim Eckert (Anchor State Bank): initial corn crop indications are not as good as 2024.
* Terry Engelken (Washington State Bank): Dry weather appears to have lowered yield expectations for corn and soybeans.
Image: The article includes an image courtesy of creighton University.