Businesses are also suffering from elevated inflation through rising and volatile prices for inputs and the need to price their own goods and services to cover costs without losing customers. This dynamic is evident in agriculture and what we are hearing directly from farmers and ranchers, who are dealing with added weather challenges and on-going drought.
Prices for commodities have declined lately but are still at historically high levels. In contrast, prices for fertilizer and many crop inputs continue to rise. In some areas, high input costs and drought conditions are contributing to record early season cattle auction sales, as many ranchers choose to sell herds early to limit further outlays for input expenses.