News

Ag Economy Barometer slips again in March

The Purdue University/CME Group Ag Economy Barometer slipped for the second consecutive month.

Purdue ag economist David Widmar says producer sentiment dropped to 124 in March off of its high of 153 in January.  “Keep this all in mind that we’ve seen a post-harvest rally in producer sentiment that kicked off in November,” he says.  “We’ve seen some ups and downs, but the last four months we’ve seen strongest sentiment in all of 2016 and the end of 2015.”

He tells Brownfield the share of producers reporting their farm is financially “worse off” than a year ago is improving.  “Fifty-one percent say they are financially worse off than a year ago, that was down from 67 percent last year and as high as 81 percent back in August,” he says.

Widmar says the improvement is attributed to record – or near record – crop yields and strengthening crop prices.  “Commodity prices, while they’ve backed off a little bit in the last couple of weeks are still higher than our harvest lows,” he says.  “This has kind of put producers in a better shape in terms of their balance sheets and their financial statements.”

He says one other driving factor in the uptick in producer sentiment, could be the significant improvement in producers’ expectation of the overall U.S. economy, which more than doubled from October to March.

AUDIO: David Widmar, Purdue University