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News from Around the Farm World - May 21, 2008

Weather, energy hampering Midwestern economy

OMAHA, Neb. (AP) — A Midwest economic index has hit a new low despite record farm income, brisk farm equipment sales and rising farmland prices.

The Rural Mainstreet Index declined this month to 42.6 from April’s 47.5. Both figures are well below a growth-neutral 50, and the May figure is the lowest since the survey began in late 2005. An index greater than 50 indicates a growth over the next three to six months.

In a report released May 16 on the survey, the disappointing numbers were blamed in part on poor weather and higher energy prices.

“It has been a very cold and wet spring and planting is behind normal,” said one of the survey respondents, Pete Haddeland, president of First National Bank in Mahnomen, Minn. “High fuel and input costs have people closely looking at overall costs.”

Nevertheless, record farm income is propelling farmland prices higher and farm equipment sales remain strong, said Creighton University economist Ernie Goss, who oversees the survey. Goss and Bill McQuillan, CEO of City National Bank in Greeley, Neb., created the monthly economic survey of rural bank CEOs in 11 states: Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Montana, Nebraska, North Dakota, South Dakota and Wyoming.

The average community population covered by the survey is about 1,300. The higher farm income and higher travel costs have not led to stronger retail sales in rural areas. The May retail sales index plunged to 36.7 in May, compared with 40.3 in April. A year ago the figure was 50.8.

“Farmers are just not spending a lot of their elevated income with local merchants, except for agriculture equipment dealers,” Goss said.

The survey asked the bankers whether higher fuel prices have led townspeople to shop locally.

Only 15.7 percent responded yes; 21.6 said no, there was no increase in local buying.

Barry Linnens, CEO of Cottonwood Valley Bank in Cedar Point, Kan., said local folks were still heading into the cities to shop but were making fewer trips and larger purchases.

Record farm income continued to drive ag land prices. The survey’s May farmland price index dropped slightly to a strong 71.2, down only a tenth of a point from 71.3 in April.

Although most rural areas haven’t experienced the mortgage problems vexing urban areas, the national economic downturn and the housing problems were still being reflected.

The rural bankers survey index for home sales in May rose slightly, to still weak 35.8 from April’s 33.6 and March’s 25.8.

The confidence index, which tracks the economic outlook for six months out, jumped to 47.5 from 36.9 in April. The index has remained below growth-neutral 50 for eight months in a row.

Tennessee creamery recalling one lot of cheese

PHILADELPHIA, Tenn. (AP) — An eastern Tennessee creamery is recalling a line of its cheese because of the potential for bacterial contamination.

Sweetwater Valley Farm said its Tennessee Aged Black Pepper Cheese should not be eaten because it has the potential to become contaminated with Listeria organisms. The bacteria can cause serious and sometimes fatal infections in young children, frail or elderly people and those with compromised immune systems.

Healthy adults could have short-term illness including fever, headache, abdominal pain and diarrhea.

The contamination was detected during a routine state inspection. The cheese was sold at the creamery near Sweetwater and a winery in Portland, Tenn. The lot number is 616-361 and the product includes 5-, 7- and 10-ounce bars. The cheese was produced between Dec. 27, 2007, and May 12, 2008.

Consumers who have cheese from the lot can bring or ship it back to the store for refund or replacement.

Judge: Jackson County must pay owner for seized horses

GRASS LAKE TOWNSHIP, Mich. (AP) — A judge has ruled that Jackson County must pay the owner of horses seized from a Grass Lake Township farm last year in a neglect investigation for lost property.

The Jackson Citizen Patriot reports Circuit Court Judge Thomas Wilson said a district court’s decision ordering James Henderson Jr. to forfeit his herd based on claims of animal cruelty was improper. A district court is expected to determine the amount owed. County prosecutors plan to appeal.

Last month, another judge dismissed felony torture charges against Henderson and manager Matthew Mercier.

They both still face one misdemeanor count of neglect, but Mercier said the May 16 ruling is vindication for Henderson.

Animal control officials in March 2007 confiscated the herd from the Turn-3 Ranch.

Chicago overturns two-year-old citywide foie gras ban

CHICAGO, Ill. (AP) — The Chicago City Council has repealed its controversial two-year-old ban on foie gras, a delicacy made of duck and goose liver.

The vote was led by Mayor Richard M. Daley, who called the measure that went into effect in August 2006 the “silliest” ordinance the council’s ever passed. Supporters of the ban consider foie gras cruel because geese and ducks are force-fed to make their livers bigger.

The measure passed May 14 by a vote of 37-6 with no debate. Its sponsor, Alderman Joe Moore, shouted his objections.

The Illinois Restaurant Assoc. and a local restaurant had filed a lawsuit in federal court seeking to overturn the ban, but a U.S. District Court judge dismissed the effort last June.

5/21/2008