(Radio Iowa) – A northwest Iowa banker says interest rates and commodity prices are squeezing the farm economy. Jeff Plagge served as State Banking Superintendent for four years, retired from that post last December and is now a member of a state panel that forecasts state tax revenue. “Harvest was as fast as I’ve ever seen it, personally, this year due to the dry weather and I would say yields from what I’ve heard from most people were at least at or slightly better than usual, with some exceptions in some areas of the state, but the commodity prices have challenged the market,” Plagge says.

“It’s early in the credit cycle so we’ll find out a little bit more over the winter months what the true impact of that is going to be on ag.” In the agri-business sector, Cargill — which makes livestock feed — is laying off five percent of its workforce and John Deere has laid off over 17-hundred workers from its Iowa facilities this year.

“Farmers are pretty good at closing the checkbook when they feel like there are pressures on their balance sheet,” Plagge says. Plagge says despite the headwinds, however, the overall economy has been pretty resilient. Plagge has been in Iowa’s banking industry for 44 years and led four different banking organizations, including Northwest Iowa Banking Corporation in Arnolds Park.

Plagge retired from that family-owned bank holding company in 2020, shortly after he took over as state banking superintendent.