The Agricultural Outlook for 1932

Excerpts from the report: The domestic demand for farm products has fallen to unusually low levels as a result of the further decline in business activity during 1931. The low level of industrial activity and consumer incomes in 1931 will continue to influence domestic demand for farm products into 1932. Improvement in demand, of course, depends on improvement in business activity which in turn is largely influenced by improvement in credit conditions and the restoration of business confidence. The trends of industrial production and pay rolls through the spring and summer months should furnish a guide to farmers for the probable demand for their products in the latter part of 1932. Domestic demand for farm products, after showing some improvement during the first few months of 1931 declined throughout the remainder of the year. Unfavorable financial developments abroad, the development of further liquidation in the security markets, and a high rate of bank suspension in this country were the chief factors in counteracting the favorable developments that were laying the groundwork for eventual business recovery. The net result of these interrelated developments, manifesting themselves in a further recession in industrial activity, in decreased money incomes of consumers, in falling prices, and restricted credit conditions, was to reduce the gross farm income from the 1931 farm production to $6,900,000,000 from $9,300,000,000 in 1930 and $11,900,000,000) in 1929. This reduction in gross income of about $5,000,000,000, or more than 40 per cent in two years, reflects chiefly the price decline during the last two seasons