Farmers optimistic about current conditions, pessimistic about future
An ag economist says a paradox has developed in producer sentiment as farmers are optimistic about current conditions but pessimistic about future expectations.
David Widmar says the Purdue University/CME Group Ag Economy Barometer’s index of future expectations fell to 120, the lowest it’s been since October 2016.
“Three out of 10 producers are worried, or thinking, or planning that in December 2018 there family farm operation might be in a worse situation than it is today,” he says. “That’s concerning because we’re in a tough farm economy right now and any step to the worse is challenging.”
He tells Brownfield producer sentiment about the future is what caused the overall barometer to drop to 126. However, the index of current conditions climbed to 139, the highest it’s been since July.
“We’ve had pretty strong yields especially here in the corn belt and strong yields have offset these less than optimal commodity prices,” he says. “But on the other side of things commodity prices are lower than what many people would have liked to see, but they’re stronger than what a lot of people feared they would be.”
Widmar says farmers were also asked if it’s a good time to bring a new generation into the operation. He says farmers were split with 51 percent saying yes. He says 56 percent of farmers said five years from now would be a better time to bring in the next generation.
The Ag Economy Barometer is based on a monthly survey of 400 U.S. agricultural producers. A rating below 100 is negative, while a rating above 100 indicates positive feelings about the ag economy.
Audio: David Widmar, Purdue University