Wichita Led by a bountiful wheat crop, farm income is projected to rebound 40 percent in 2003 in Kansas and neighboring states, a Federal Reserve Bank economist said Thursday.
But in Wichita the aviation industry is king, and the king has a hangover. Economic recovery here may not come until early 2005, a Wichita State University economist said. More job losses are forecast -- including an additional 2,000 lost jobs next year in the city's manufacturing sector.
Speakers at the annual Wichita Area Economic Outlook Conference brought into sharp focus the contrast between the state's rural and urban economies. Put plainly, the countryside is doing better than the cities.
The so-called prairie gateway states, which include Kansas, showed some of the strongest growth in farm income in the country, said Jason Henderson, economist for the Center for the Study of Rural America at the Federal Reserve Bank of Kansas City.
Cash receipts for wheat are 25 percent higher than last year and 10 percent above the five-year average, he said. Record high cattle prices also are boosting income for ranches, cattle feeders and the meat-packing industry, he said.
Henderson said the farm debt picture conditions also were starting to improve, as shown in the last two quarters.
"The largest improvements were in Colorado and Kansas -- two areas most severely scarred by drought last year," he said.
Net farm income for 2003 in the nation is expected to be $19.6 billion, up $11 billion from last year, he said.
The farm recovery has led to strong land values, which the Federal Reserve estimates are up 4 to 7 percent, Henderson said. Also spurring farmland values are increased investments in land as investors look for alternatives to a volatile stock market.
Tempering the improved farm income outlook, is the return of drought conditions in pockets of the state in August, he said.
Lt. Gov. John Moore touted the state's new economic stimulus plan, which regionally focuses its economic development efforts.