The Purdue University-CME Group Ag Economy Barometer rose modestly in February posting a reading of 111, five points higher than a month earlier. The modest rise in the barometer was attributable to producers expressing somewhat more optimism about the future as the Future Expectations Index rose seven points to a reading of 115. The Current Conditions Index was unchanged at 103 compared to a month earlier.
Meanwhile, February’s Farm Financial Performance Index reading of 85 was one point lower than in January and 13 points below its most recent peak in December. Weak crop prices continue to weigh on financial expectations as mid-February Eastern Corn Belt cash prices for corn and soybeans were percent and eight percent lower, respectively, than two months earlier when the December survey was conducted.
When asked about their biggest concerns for their farm operation in the upcoming year, producers in this month’s survey continued to point to high input costs and lower crop and livestock prices.
(From the National Association of Farm Broadcasters)
Modest Improvement In Farmer Sentiment, Yet Financial Concerns Loom
March 5, 2024
James Mintert and Michael Langemeier, Purdue Center for Commercial Agriculture
The Purdue University-CME Group Ag Economy Barometer rose modestly in February posting a reading of 111, 5 points higher than a month earlier. The modest rise in the barometer was attributable to producers expressing somewhat more optimism about the future as the Future Expectations Index rose 7 points to a reading of 115 while the Current Conditions Index was unchanged, both compared to a month earlier. Although farmers’ expectations for the future improved in February, their financial performance expectations did not. February’s Farm Financial Performance Indexreading of 85 was 1 point lower than in January and 13 points below its most recent peak in December. Weak crop prices continue to weigh on financial expectations as mid-February Eastern Corn Belt cash prices for corn and soybeans were 7 and 8% lower, respectively, than two months earlier when the December survey was conducted. The February Ag Economy Barometer survey was conducted from February 12-16, 2024.
When asked about their biggest concerns for their farm operation in the upcoming year, producers in this month’s survey continued to point to “high input costs” (34% of respondents) and “lower crop/livestock prices” (28% of respondents) as their top two concerns. Interest rate worries among agricultural producers might have peaked as just 18% of February respondents cited “rising interest rates” as a top concern, down from 26% as recently as last November.
The Farm Capital Investment Index remained weak in February, declining 1 point to a reading of 34 which was 9 points lower than a year earlier. Responses from producers who said now is a bad time to make large investments reflected their concerns about high production costs and weak output prices. The percentage of farmers who said it’s a bad time because of “uncertainty about farm …..