Purdue/CME’s Ag Economy Barometer Reports Farmer Sentiment On Current Conditions Slips

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Figure 1. Purdue/CME Group Ag Economy Barometer, October 2015-September 2019.

Source: Purdue Univ news release

To view the complete report, click here.

The Ag Economy Barometer dipped slightly in September to a reading of 121, down just 3 points from August, when the index stood at 124. Although the barometer’s decline was small, there was a relatively large sentiment shift among ag producers as they were noticeably more pessimistic about current conditions on their farms and in the U.S. ag economy , but somewhat more optimistic about future economic conditions, both compared to one month earlier.

The Index of Current Conditions declined from a reading of 122 in August to 100 in September. This was in contrast to the Index of Future Expectations, which actually rose 6 points compared to August, with a September reading of 131.

The Ag Economy Barometer is based upon results from a nationwide telephone survey of 400 U.S. crop and livestock producers. This month’s survey was conducted from September 9-13, 2019.

Concerns about current economic conditions on their farms spilled over into producers’ perspective on making large investments in their farming operations. The Farm Capital Investment Index, which is based upon a question posed to farmers each month regarding the advisability of making large investments in their farming operations in items such as machinery or buildings, declined for the second month in a row to 47.

Figure 2. Indices of Current Conditions and Future Expectations, October 2015-September 2019.

This was down 9 points compared to August and 20 points below the Farm Capital Investment Index’s highest reading of this calendar year, observed in July when crop prices were near their 2019 peak.


Figure 3. Farm Capital Investment Index, October 2015-September 2019.

 

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