The Purdue University/CME Group Ag Economy Barometer fell one other two factors in June, to a studying of 97. Farmers’ sentiments for the monetary future are at an all-time low since knowledge assortment started in 2015. While the Current Conditions Index rose 5 factors from May, the Index of Future Expectations fell a full 5 factors, its lowest since October 2016. This quantity is surprisingly decrease than indexes in April and May of 2020 when COVID was hitting.
While the Farm Financial Performance Index rose two factors from May, 83 factors are nonetheless one of many lowest readings of the final two years. When requested if their operation at the moment is healthier off, worse off, or about the identical in comparison with a 12 months in the past, 49 p.c of respondents responded that their operations have been worse off. Only 14 p.c responded that their operations have been higher off than a 12 months in the past. These responses fell from final 12 months’s ranking of 28 and 14 p.c respectively.
While farmer confidence stays greater for farm and ranch costs, solely 57 p.c reply that costs shall be greater 5 years from now versus the 70 p.c who responded final month. Farmer’s willingness to make capital funding purchases stays at a report low of 35 for the second month in a row. The overwhelming response by farmers is that it’s not an excellent time to buy equipment. 50 p.c of respondents famous that they’ve been impacted by low equipment ranges.
Among the best considerations for farmers are greater enter prices with 43 p.c of farmers noting this as their high concern. Following are the supply of inputs at 21 p.c, decrease crop and/or livestock costs at 17 p.c, and environmental, local weather, and farm insurance policies respectively.
Over half of farmers who planted corn or soybeans in 2020 anticipate farmland money rental charges to rise within the subsequent 12 months. 80 p.c of those respondents anticipate these charges to rise 5 p.c or extra and 40 p.c anticipate charges to rise by ten p.c or extra.
We could also be seeing important adjustments in winter wheat acreage based mostly on producer survey responses. Winter wheat costs are greater, and 31 p.c of producers mentioned that that they had planted winter wheat within the fall of 2021. Of this, 24 p.c plan to extend their manufacturing. Out of the people who didn’t develop winter wheat, 14 p.c mentioned that they might plant winter wheat within the fall of 2022.
Despite a small enhance in present circumstances, rising enter prices and costs proceed to weigh closely on producer’s degree of optimism. Farmer optimism continues to be impacted by weaker future expectations.
Read the total Ag Economy Barometer report at right here. The web site additionally affords extra assets — resembling previous stories, charts and survey methodology — and a type to join month-to-month barometer e-mail updates and webinars. A brief video evaluation is accessible on YouTube as properly. For much more info, take a look at the Purdue Commercial AgSolid podcast.
The Ag Economy Barometer is calculated every month from 400 U.S. agricultural producers’ responses to a phone survey. This month’s survey was performed between June 13 and 17, 2022.