Inside INdiana Business is reporting that a national survey of 400 farmers, conducted by Purdue’s Center for Commercial Agriculture, shows ag producers were a bit more pessimistic last month about the overall economic conditions in farm country. The Purdue University Ag Economy Barometer dropped three points from the August reading.
Purdue economists say while the decline is small, they say there is a relatively large shift in farmer’s sentiment about current conditions.
The Index on Current Conditions, a sub-category of the survey, dropped from 122 to 100 in September. However, looking ahead, the Index of Future Expectations rose six points from the August measurement with a September reading of 131.
With the uncertainty, it appears farmers are less likely to make major capital investments, such as machinery or building. This index dropped for the second straight month.
The Ag Barometer also shows fewer farmers expect crop profitability to decline in the coming year.
“In May, at a time when concerns about delayed planting were rising and crop prices were low, farmers had an extremely negative outlook with 41 percent of respondents telling us they expected profitability to decline over the next year,” said Jim Mintert, director of the Purdue University Center for Commercial Agriculture. But Mintert says as crop conditions improved, farmers became more optimistic. In the most recent survey, just one out of five producers, 21 percent, said they expected profitability to decline.
Mintert says their readings show more farmers expect better growing conditions in 2020 compared to this year, which would lead to stronger financial performance.
A majority of the farmers in this survey are still optimistic about the trade dispute and tariff battle with China. Mintert says more than 70 percent feel there will be a favorable outcome for farmers.