With higher costs to plant crops this spring and uncertainty surrounding the war in Ukraine, U.S. farmers are not feeling very optimistic about the economy right now, according to the latest Purdue University/CME Group Ag Economy Barometer. The monthly measurement of producer sentiment fell 12 points from last month to a reading of 113, which is the weakest reading in nearly two years.
The Purdue Center for Commercial Agriculture, which conducts the survey, says farmers remain concerned about rising input costs and availability, just as planting season gets underway.
Purdue says the war in Ukraine exacerbated farmers’ worries about production costs.
“Concern about the war’s impact on input prices and input availability on their farming operations was paramount in the minds of producers responding to the March survey and was a major factor in this month’s decline in sentiment,” said James Mintert, director of Purdue University’s Center for Commercial Agriculture.
Surveyors also asked farmers about their plans to purchase farm machinery and make big investments in their farming operations. Of those who responded, over 60% said they were foregoing those plans.
Mintert says even though grain prices have improved, farmer sentiment has not.
“When producers think about how their farm will fare financially in 2022, it’s clear they do not expect commodity price strength to offset the dramatic rise in farm production costs they are experiencing,” Mintert said.
The Ag Economy Barometer is calculated each month from responses from 400 U.S. agricultural producers. Click here to view video commentary from Mintert.