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Barometer: farmers are more optimistic about the future

Farmers are more optimistic about the future of the ag economy, according to the latest Purdue University/CME Group Ag Economy Barometer.

Jim Mintert, director of the Purdue Center for Commercial Agriculture, says strong commodity prices are helping to boost sentiment.

“People are realizing that even with a bounce back in acreage this year and trendline yields we still have a pretty tight supply-demand balance for corn and soybeans,” he says. “That’s especially the case for soybeans, but also even for corn. It looks like the acreage off the USDA’s Prospective Plantings report and trendline yields will probably pull down corn carryover. I think that’s part of it—a reflection that this isn’t just a one-year situation with respect to the strength we’re seeing in prices.”  

The overall Ag Economy Barometer rose to 177, the highest reading since October. The Index of Future Expectations was up 16 points at 164 and the Index of Current Condition held steady at 202.

He tells Brownfield the latest Hogs and Pigs report from the USDA, which came out the same week they collected data for the barometer, is also providing some additional producer confidence.

“From the livestock sector perspective I think that probably boosted things a bit because pork suppliers based on that report are going to be smaller than the trade was expecting coming in and we’ve seen a positive response to that,” he says. “A little bit of positivity with respect to the longer-term outlook for the crops and a little bit of a boost on the livestock side as well is probably the best explanation we have with respect to the improvement.”

The monthly national survey of 400 U.S. agricultural producers was conducted March 22-26.

Audio: Jim Mintert