There was more evidence this week that the nation's economy is on the mend. Bankers report both deposits and demand for mortgage loans are strong. Additionally, the prospect of higher interest rates has ebbed on assurances from Alan Greenspan that the Federal Reserve is in no hurry to raise rates. The Fed chairman's comments to Congress were buttressed by a consumer inflation report of only a modest three-tenths of a percent rise in March, despite a sharp run-up in gasoline prices.
In Rural America, the concerns over the U.S. economic climate are secondary to the pace of putting in a crop.
While the warm dry weather may aid the progress of planting, it has not been kind to the nation's wheat growers. Almost 70% of the winter wheat crop is rated at no better than fair, a third falls into the "very poor" or "poor" categories.
Even so, the grain markets have traded unenthusiastically. World demand for wheat is tepid and demand for feed grains is not expected to be much greater in view of the fact there is plenty of meat. Additionally, livestock producers aren't expected to expand herds or flocks.
For example, since February the value of the lean hog futures contract has dropped 17 percent. The hog market has been pressured by ample supplies of pork and by competing supplies of beef and, more recently, unsold chicken hind quarters. The month-long Russian ban of American poultry meat pushed the low-cost hind quarters onto the domestic U.S. market.
USDA and industry economists see the pressure easing, but not until latter in the year.