(NAFB) — The Purdue University/CME Group Ag Economy Barometer rose 27 points to a reading of 183 in October, setting an all-time high for the index. Farmers were more optimistic about both the future and current financial situations on their farms.
The Current Conditions Index rose 36 points to a reading of 178, and the Future Expectations Index climbed 23 points to a reading of 186. Since bottoming out this summer, the ag economy has rebounded sharply, and the dramatic improvement in sentiment mirrors the turnaround in the farm income picture. Organizers say the early fall rally in commodity prices combined with government program payments boosted farm income.
Corn and soybean prices continued to rally even though U.S. corn yields are expected to set a record high, and USDA projects soybean yields to be the fourth highest on record.
Comparing their farm’s financial condition today to one year ago, 25 percent of survey respondents said their farm was better off financially now than at the same time last year.
(From the National Association of Farm Broadcasters)
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Ag Economy Barometer Rises to Record High On Improving Financial Conditions
James Mintert and Michael Langemeier, Purdue Center for Commercial Agriculture
A breakdown on the Purdue/CME Group Ag Economy Barometer October results can be viewed below.
Find the audio podcast discussion for insight on this month’s sentiment at https://purdue.ag/agcast.
Farmer sentiment hit a new record high in October as the Purdue University-CME Group Ag Economy Barometer climbed to a reading of 183, a 27-point increase compared to September. The reading easily eclipsed the previous record high set back in February, before the pandemic’s onset. Both of the barometer’s sub-indices also set new record highs in October. Producers were more optimistic about the future as the Index of Future Expectations rose to 186, 23 points higher than in September, and especially about the current situation, as the Index of Current Conditions reached 178, 36 points higher than in September. The Ag Economy Barometer is calculated each month from 400 U.S. agricultural producers’ responses to a telephone survey. This month’s survey was conducted from October 19-23, 2020.
The late summer/fall rally in commodity prices, combined with government program payments arising from the second round of the Coronavirus Food Assistance Program (CFAP 2), appeared to be the primary drivers behind the sentiment improvement. Corn and soybean prices continued to rally despite the fact that U.S. corn yields are expected to set a new record high and soybean yields are projected by USDA to be ……
Read more about the Purdue/CME Group Ag Economy Barometer October results.