Rural Mainstreet Economy Continues to Weaken Under Pressure

August 2025 Survey Results at-a-Glance:

-For the sixth time in 2025, the overall regional economic index sank below growth neutral.
-For the 15th time in the past 16 months, farmland prices sank below growth neutral.
-Approximately, six of 10 bank CEOs support a Federal Reserve rate cut at its September meeting. Only 3.7% support a rate cut of more than 25 basis points (1/4%).  
-On average, bank CEOs expect one in five grain farmers to experience negative cash flow for 2025.
-Farm equipment sales dropped below growth neutral for the 24th straight month.
-According to trade data from the International Trade Association (ITA), regional exports of agriculture goods and livestock for the first half of 2025, compared to the same 2024 period, fell from $6.2 billion in 2024 to $5.4 billion in 2025, for a decline of 12.7%.
-For the first half of 2025, Mexico was the top destination for regional agriculture exports, accounting for 57.1% of total regional agriculture and livestock exports.

OMAHA, Nebraska (August 21, 2025) — 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,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

According to Jeff Bonnett, President of 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 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,” said Goss.

Jim Eckert, Executive VP and Trust Officer of Anchor State Bank in Anchor, Ill. said, “Corn crop in Central Illinois is the tallest I've seen in 50+ 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.”

According to trade data from the International Trade Association (ITA), regional exports of agriculture goods and livestock for the first half of 2025, compared to the same 2024 period, fell from $6.2 billion in 2024 to $5.4 billion in 2025, for a decline of 12.7%. For the first half of 2025, Mexico was the top destination for regional ag exports, accounting for 57.1% of total regional agriculture and livestock exports.

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 that 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,” said Goss.

Despite weakness in the farm-based economy, bankers continue to report little change in farm loan payments, delinquencies and bankruptcies. On average, bankers reported 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 its descent.

Banking: The August loan volume index declined to 82.7 from July’s record high 87.5. The checking deposit index soared to 63.5 from July’s 45.8. The index for certificates of deposits (CDs) and other savings instruments rose to 59.6 from 56.3 in July. Federal Reserve interest rate policies have boosted CD purchases above growth neutral for 33 straight months.

Hiring: The new hiring index for August advanced to 56.0 from 50.0 in July. Job gains for non-farm employers have been positive, but soft for the last several months.

Confidence: Rural bankers remain pessimistic about economic growth for their area over the next six months. The August confidence index weakened to 27.8 from 36.0 in July. “Weak grain prices and negative farm cash flows, combined with tariff retaliation concerns, pushed banker confidence lower,” said Goss.

Home and retail sales: Home sales increased to 48.1 from July’s 48.0. Regional retail sales, much like national retail sales for August were fragile with a reading of 46.2 from 47.8 in July.

The survey represents an early snapshot of the economy of rural agriculturally- and energy-dependent portions of the nation. The Rural Mainstreet Index is a unique index that covers 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. Goss and the late Bill McQuillan, former Chairman of the Independent Community Banks of America, created the monthly economic survey and launched it in January 2006.

Below are the state reports:

Colorado: The state’s Rural Mainstreet Index (RMI) for August slumped to 39.4 from 53.2 in July. The farmland and ranchland price index for August fell to 39.1 from 53.3 in July. The state’s new hiring index dropped to 49.6 from July’s 50.8. According to trade data from the International Trade Association, Colorado exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, fell by $4.5 million, for a 2.3% decline. Mexico was the top destination for 2025 exports, accounting for 23.7% of 2025 Colorado agriculture and livestock exports.

Illinois: The state’s August Rural Mainstreet Index (RMI) dropped to 38.8 from 51.4 in July. The farmland price index for August declined to 38.6 from 49.3 in July. The state’s new hiring index for August increased to 49.6 from 46.8 in July. According to trade data from ITA, Illinois exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, sank by $981.5 million, for a decline of 41.0%. Mexico was the top destination for state exports, accounting for 31.7% of 2025 Illinois agriculture and livestock exports.

Iowa: August’s RMI for the state declined to 35.5 from 49.7 in July. Iowa’s farmland price index for August dropped to 35.4 from 46.3 in July. Iowa’s new hiring index for August rose to 46.6 from 43.0 in July. According to trade data from ITA, Iowa exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, climbed by $149.8 million, for an expansion of 18.1%. Mexico was the top destination for state exports, accounting for 72.6% of 2025 Iowa agriculture and livestock exports.

Kansas: The Kansas RMI for August dropped to 39.9 from 47.8 in July. The state’s farmland price index decreased to 39.6 from 43.1 in July. The new hiring index advanced to 50.7 from 39.0 in July. According to trade data from International Trade Association, Kansas exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, expanded by $28.1 million, for a growth of 4.1%. Mexico was the top destination for state exports, accounting for 80.4% of 2025 Kansas agriculture and livestock exports.

Minnesota: The August RMI for Minnesota increased slightly to 51.4 from 51.2 in July. Minnesota’s farmland price index increased to 50.7 from 49.6 in July. The new hiring index for August climbed to 61.3 from 50.5 in July. According to trade data from ITA, Minnesota exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, sank by $90.5 million, for a decline of 16.8%. Mexico was the top destination for state exports, accounting for 39.0% of 2025 Minnesota agriculture and livestock exports.

Missouri: The August RMI for the state rose to 53.5 from July’s 49.0. The farmland price index for August climbed to 52.7 from 45.2 in July. The state’s new hiring gauge for August soared to 63.2 from July’s 41.7. According to trade data from ITA, Missouri exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, fell by $46.9 million, for a decline of 9.8%. Mexico was the top destination for state exports, accounting for 86.0% of 2025 Missouri agriculture and livestock exports.

Nebraska: The Nebraska Rural Mainstreet Index for August sank to 43.2 from 51.1 in July. The state’s farmland price index for August fell to 42.8 from July’s 48.8. Nebraska’s new hiring index improved to 53.7 from July’s 46.1. According to trade data from the International Trade Association, Nebraska exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, rose by $175.6 million, for a 36.2% gain. Mexico was the top destination to begin 2025, accounting for 67.5% of 2025 Nebraska agriculture and livestock exports.

North Dakota: The state’s overall RMI for August declined to 50.4 from July’s 52.2. The state’s farmland price index increased to 49.7 from July’s 46.8. The state’s new hiring index rocketed to 60.3 from 48.3 in July. According to trade data from ITA, North Dakota exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, fell by $24.1 million, for a decline of 5.0%. Mexico was the top destination for state exports, accounting for 52.9% of 2025 North Dakota agriculture and livestock exports.

South Dakota: The August RMI for South Dakota increased to 52.6 from 52.0 in July. The state’s farmland price index increased to 51.8 from 50.2 in July. South Dakota’s August new hiring index climbed to 62.4 from July’s 47.9. According to trade data from the International Trade Association, South Dakota exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, rose by $8.9 million, for a 13.4% gain. Mexico was the top destination for 2025, accounting for 77.3% of 2025 South Dakota agriculture and livestock exports.

Wyoming: The August overall RMI for Wyoming climbed to 56.4 from July’s 52.7. The August farmland and ranchland price index increased to 55.5 from 51.4 in July. Wyoming’s new hiring index soared to 65.9 from 49.4 in July. According to trade data from the International Trade Association, Wyoming exports of agriculture goods and livestock for the first half of 2025, compared to the same period in 2024, rose by $3.1 million, for a 174.6% gain. Canada was the top destination for 2025, accounting for 63.9% of 2025 Wyoming agriculture and livestock exports.