News

Farmers less optimistic about current conditions, more optimistic about future

Producer sentiment held somewhat steady in the latest Purdue University/CME Group Ag Economy Barometer.

Jim Mintert with Purdue University says farmers remain optimistic about the future even though they are less optimistic about current economic conditions. He says President Trump’s announcement of a phase one trade agreement likely helped improve producer sentiment…

“I think expectations for a more normal trading pattern in 2020 probably did feed into some of that future optimism we were picking up and I think that was probably key,” he says.

The overall barometer was 150 in December, compared to 153 in November. The Index of Current Conditions fell 12 points to 141 and the Index of Future Expectations rose slightly to a reading of 155.

Mintert says the survey showed the variability in economic conditions on US farm operations in 2019.  

“Roughly half of the people said that their financial performance in 2019 matched their expectations, three out of 10 said worse than expected, and two out of 10 said it was a little better than expected,” he says. “What I really think is that just gives us an indication as to how diverse conditions were across agriculture.”

He says farmers surveyed are less optimistic about the future direction of farmland values.

“If you look at the farmland price expectations either 12 months ahead or five years ahead, producers were less optimistic about prices for farmland than they were in November,” he says. “However, if you compare it to a year ago, they were about the same so I think we’ve seen some volatility.”

The monthly survey of 400 US farmers was conducted December 9-13.

Audio: Jim Mintert, Purdue University