Commodity Prices, Interest Rates, Prompt Ag Economy Barometer Decline

Sabrina Halvorson Agri-Business

Farmer sentiment weakened again in March as the Purdue University-CME Group Ag Economy Barometer fell eight points to a reading of 117. Both the Index of Current Conditions and the Index of Future Expectations declined eight points in March, leaving the Current Conditions Index at 126 and the Future Expectations Index at 113. Weaker prices for key commodities, including wheat, corn, and soybeans, from mid-February through mid-March were a key factor behind this month’s weaker sentiment reading.

This month’s survey was conducted from March 13-17, 2023, which coincided with the demise of Silicon Valley Bank and Signature Bank. Although the March survey did not include any questions directly related to the bank closures, it did reveal that rising interest rates have become a bigger concern among farmers.

Although producers still cite high input costs as their top concern, they are becoming more worried about rising interest rates and the impact those higher rates will have on their operations.

From the National Association of Farm Broadcasters