Iowa’s gross domestic product declined in the fourth quarter of 2021 behind weak agricultural performance. It was the second straight quarter of decline after four quarters of growth.

The fourth-quarter report, released Thursday by the U.S. commerce department’s Bureau of Economic Analysis, showed that Iowa’s GDP declined by 2.3% from the previous quarter, the largest decline of any state in the country. Texas saw the largest increase in its GDP at 10.1%. Each of Iowa’s neighboring states, except for Nebraska, saw growth in fourth-quarter GDP, the report showed.

Wisconsin’s GDP grew 6.1%, Illinois saw 5.1% growth in its GDP, Minnesota’s GDP grew by 5%, Missouri had 4.4% growth, and South Dakota’s GDP grew by 0.3% in the fourth quarter. Nebraska’s GDP declined by 0.8% in the quarter. Nationally, the GDP grew at 6.9%.

Despite Iowa’s fourth-quarter decline, the state’s GDP for 2021 grew 6.4%, higher than any of its neighboring states and outpacing the national rate of annual growth of 5.7%

The GDP measures the monetary value of finished goods and services in each state and the country. In quarterly reports, the GDP is expressed in annualized amounts. The monetary value of Iowa’s GDP in the fourth quarter was nearly $180,048 billion.

In Iowa, agriculture saw the steepest decline at 6.82%, which was large enough to offset marginal growth in several other industries.

Durable goods manufacturing rose 0.69% in the fourth quarter. Nondurable goods manufacturing rose 1.04%. Retail trade saw 0.44% growth, finance and insurance grew 0.41%, and the arts and entertainment sector grew 0.09%.

Conversely, construction fell 0.48% while accommodations and food service fell slightly at 0.06%.

Chad Hart, an agricultural economist at Iowa State University, said he believes the large decrease in the agricultural sector is a response to projected lower farm net income as a result of increases in expenses, such as seed and fertilizer.

Most of the effect of increased commodity prices was likely felt in the second and third quarters of 2021, while the brunt of increased input costs likely began to be felt by farmers in the fourth quarter, he said.

“Crop and livestock receipts are projected to rise this year, but that gain is less than the combination of ag government support and the gain in ag production expenses,” Hart said.