Producer sentiment slips following harvest

According to the latest Purdue/CME Ag Economy Barometer, producer sentiment slipped following harvest.  The November barometer dropped 7-points to 128, the second-lowest reading for 2017.

Purdue ag economist David Widmar says the decline was driven by the reduced optimism about the future.  “Respondents described the next 12 months in agriculture as bad times financially,” he says.  “This has been trending higher since this summer when it hit a low of 50 percent getting that rating back in July.  This is a weakening of the next 12 months or so.”

Widmar says throughout 2017 they’ve also surveyed producers to see how proposed policy changes, like trade, would impact producer sentiment.

He says 96 percent of producers surveyed said exports were important to the ag economy.  But when producers were asked specifically about the impact of the North American Free Trade Agreement – they were less confident about its impact.  “Twenty percent of respondents gave it a neutral, or unsure rating when asked about how important that was to the agricultural economy,” he says.

At the same time, he says 24 percent of respondents rated NAFTA as “very important” to the ag economy.

The Ag Economy Barometer is based on a monthly survey of 400 U.S. agricultural producers.  A rating below 100 is negative, while a rating above 100 indicates positive sentiment about the ag economy.

AUDIO: David Widmar, ag economist, Purdue Center for Commercial Agriculture

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