A monthly survey of America’s farmers shows a growing number are concerned about rising input costs to run their operations, whether it is grain or livestock. The Purdue University/CME Group Ag Economy Barometer recorded a three point drop in producer sentiment in October, coming in at a reading of 121.
Economists from the Purdue Center for Commercial Agriculture, which conducts the monthly survey, says producers have growing concern about a “rapid” run-up in input prices, especially for fertilizer.
“There’s clearly concern on the part of farmers about farm input price inflation. One-third of the producers in this month’s survey said they expect to see farm input prices rise by 12% or more in the upcoming year,” said Jim Mintert, director of the Purdue Center for Commercial Ag. “And then a follow up question we asked producers about their biggest concerns for their farming operation in the upcoming year and 44% said that they think higher input costs are the number one concern for them.”
Mintert says other inputs such as seed, pesticides, and machinery repairs and ownership costs leading farmers to become increasingly concerned about a cost-price squeeze on their operating margins. The barometer shows livestock producers are also concerned about a cost-price squeeze, especially in the pork and dairy sectors.
The barometer shows four out of ten respondents say supply chain problems and tight machinery inventories are holding back their purchasing plans.
Mintert provides analysis of the October survey in the video below: