Although recent rains have improved crop conditions in some areas, hot dry weather earlier in the year reportedly reduced the corn, soybean, hay, and fruit crops in parts of the Cleveland, Richmond, St. Louis, and Chicago Districts. However, in Minneapolis, Kansas City, and Dallas, where yields have been relatively good, producers are benefiting from favorable corn and soybean prices. Prospects for the cotton crop have improved in St. Louis and are good in Dallas, while the winter wheat harvest is likely to exceed 1996 levels in Cleveland but to be no more than average in Minneapolis. Richmond, Minneapolis, Kansas City, Dallas, and San Francisco all report strong demand and favorable price conditions for poultry and livestock products. Benefiting from good pasture and good prices, Minneapolis and Kansas City ranchers are reportedly building breeding herds or holding calves until the spring of 1998.
Contacts also note growing exports of pork and of beef to Mexico and Southeast Asia.
Reports on the oil sector indicate that continued strong demand for energy products has led to price increases, good profits, and a resurgence in oil and gas exploration activities. In the Minneapolis, Kansas City, and Dallas Districts, rig counts are at their highest levels in years. Contacts in Atlanta note that the resurgence of the energy sector along the Gulf Coast has produced strong demand for geoscientists and petroleum engineers, while some Dallas contacts believe that a shortage of experienced crews may limit future drilling activity.