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8/8 rat Pocieral Reserve Dank of Chicago - • February 15, 1963 ./... t o L Cattle prices at Chicago have dropped preaipf-tously in recent weeks. Prices of choice, 90R-100 -DEPT. OF AGR , pound, steers are down $2 from four weeks ago aria Own about $6 from the four-year high in mid-NovemM°11.,AhrACKULTIP" ger supplies of beef and competing meats, of course, Number 691 are a major factor. Cattle slaughter during the 1,4slitR 4 1963 five weeks of 1963 rose 2 per cent above the correCattle lnshipments at Record Levels sponding period of 1962 and was almost 9 per cent in Final Six Months of 1962 above 1961. In addition, hog slaughter in thgagg SERIAL RECORDS period was up more than 3 per cent over last year and Per cent 6 per cent above two years ago. Poultry supplies also 1960 1961 1962 chan e showed a substantial rise from 1962. Li Prices of Choice Cattle Drop Sharply dollars per cwt., Chicago 900-1,100 pound steers 32 — 30 Mar. 1962—Feb. 1963 •.' 28— • ft 26 24 22 Mar. 1961—Feb. 1962 weekly average rithilitill 1.111111.11 1.1.11111 1 11hiiilililitil MAMJ J AS OND J F T Furthermore, the outlook for beef producers during the next six months holds little hope for improvement. First, larger supplies of competitive meats are expected. The fall pig crop in 1962 was 5 per cent higher than in 1961 and this will be reflected in larger pork supplies through the spring. Placements of broiler chicks during December and January—to be marketed largely in February and March—were up 5 per cent from year earlier. Second, marketings of beef cattle will probably continue above 1962 levels. Cattle on feed in the Corn Belt on January 1 were up 7 per cent and feeder cattle shipments into the Corn Belt states during 1962 were at a record high-7.1 million head compared with 6.3 million the preceding year. Since mid-1962, more than 5 million head were shipped into these states. This is 21 per cent above the corresponding period of 1960 and 1961. Livestock loans outstanding, in the major cattle feeding states in the Seventh District on January 1 were 19 per cent higher than year earlier according to a recent survey of "country" bankers. The largest increase in loan volume was reported by Iowa bankers—up 24 per cent while bankers in Illinois and Indiana noted increases of 14 and 8 per cent, respectively. Illinois Indiana Iowa Michigan Minnesota Nebraska Ohio South Dakota 8 states. . 883 274 1,626 77 491 607 85 120 4,163 (thousands) 1961-'2 762 204 1,694 57 489 722 76 161 4,164 +28 +6 +23 +7 +4 +22 +4 +38 +21 975 217 2,089 61 510 880 79 222 5,034 Net farm intome in the United States increased slightly _ during 1962 and totaled $12.9 billion for the year, $100 million above 1961. Gross farm income was estimated at $40.6 billion compared with $39.9 billion in 1961. Cash receipts from marketings pushed to a record of $35.7 billion—up from $35.2 billion in 1961—and reflected primarily higher prices received for most farm products. This increase in sales was supplemented by an increase of $300 million in Government payments through the feed grain and wheat programs. However, most of the rise in gross income was offset by an increase in production expenses of $600 million to $27.7 billion. Interest rates on time deposits at agricultural banks were generally stable during the last six months of 1962, according to a recent survey. Less than 2 per cent of the bankers reported any change. More than four-fifths of the country banks in Illinois, Iowa, Michigan and Wisconsin are paying 4 per cent for at least one kind of time deposit. About 5 per cent of the agricultural banks in these states are paying less than 3 per cent on all time deposits. (Banks in Indiana are prohibited by state regulation from paying more than 3 per cent.) . For "regular savings" deposits held for a year or more, however, only 14 per cent of the agricultural banks in the four states indicated they were paying 4 per cent; more than three-fourths were paying 3 per cent or higher; and 4 per cent were paying no interest. Research Department FARM BUSINESS CONDITIONS December 1962, with Comparisons 196 ITEMS PRICES: Received by farmers (1947 - 49 = 100) Paid by farmers (1947 - 49 = 100) Parity price ratio (1910 - 14 =100) Wholesale, all commodities (1947 - 49= 100) Paid by consumers (1947 - 49 =100) Wheat, No. 2 red winter, Chicago (dol. per bu.) Corn, No. 2 yellow, Chicago (dol. per bu.) Oats, No. 2 white, Chicago (dol. per bu.) . Soybeans, No. 1 yellow, Chicago (dol. per bu.)... Hogs, barrows and gilts, Chicago (dol. per cwt.) . Beef steers, choice grade, Chicago (dol. per cwt.) Milk, wholesale, U.S.(dol. per cwt.) Butterfat, local markets, U.S.(dol. per lb.) Chickens, local markets, U.S.(dol. per lb.) Eggs, local markets, U.S.(dol. per doz.) Milk cows, U.S. (dol. per head) Farm labor, U.S.(dol. per week without board) Factory labor, U.S. (dol. earned per week) December 89 123 79 119 130 ],9,61 November 90 123 80 120 130 December 89 121 79 119 128 2.13 2.10 2.09 1.16 0.77 2.53 16.45 28.91 /4..29 0.59 0.14 0.36 219 1.10 0.72 2.50 16.79 30.13 4.4o 0.59 0.14 0.37 218 1.11 0.73 2.48 16.95 26.13 4.45 0.61 0.14 0.35 221i. ..... 98.01 46.00a/ 97.36 ...... 96.63 PRODUCTION: Industrial, physical volume (1947 - 49 =100) Farm marketings, physical volume (1947 - 49 =100) .... 181 147 181 186 174 145 INCOME PAYMENTS: Total personal income, U.S.(annual rate, bil. of dol.) ... Cash farm income, U.S. 1 (annual rate, bil. of dol.) 24.50 ...... 448 39 432 36 4.1 63.5 4.9 63.1 4.4 62.0 113 111 115 107 108 111 173 184 172 182 148 151 EMPLOYMENT: Farm (millions) Nonagricultural (millions) FINANCIAL (District member banks): Demand deposits: Agricultural banks (1955 monthly average =100) Nonagricultural banks (1955 monthly average =100)... Time deposits: Agricultural banks (1955 monthly average =100) Nonagricultural banks (1955 monthly average =100).... 1 Based on estimated monthly income. figlOCtob er Compiled from official sources by the Research Department, Federal Reserve Bank of Chicago
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