The results of a monthly survey of farmer sentiment show producer optimism is waning as they worry about rising input costs and the financial outlook of their farming operations. The Purdue University/CME Group Ag Economy Barometer dropped 14 points in September to a reading of 124.
The Purdue Center for Commercial Agriculture, which conducts the survey, says producers are feeling less optimistic about both current conditions as well as their expectations for the future.
Purdue says it is the weakest farmer sentiment reading since July 2020 when the index stood at 118.
The barometer shows a sharp rise in farmers’ expectations regarding farm input price inflation with more than one-third expecting input prices, such as seed, fuel, and chemicals, to rise by more than 12% in the upcoming year.
“Which is more than six times the average farm input inflation rate of the last decade,” commented Center Director Jim Mintert in the report. “The percentage of respondents expecting input inflation to rise above 12% jumped from 21% last month to 34% this month.”
Farmers are also worried about exports. Mintert says in early 2020, about 70% of producers expected agricultural exports to increase over the next five years. Since then, farmer expectations regarding future agricultural trade prospects have continued to weaken.
Mintert provides commentary on the report in the video below: