Uncertain trade outlook leads to drop in farmer sentiment
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Agricultural producers across the United States expressed a decline in optimism over the state of the ag economy, according to the latest Purdue University/CME Group Ag Economy Barometer.
The barometer is calculated monthly from a telephone survey of 400 agricultural producers across the country. The barometer fell 12 points to a reading of 146 in June.
Purdue cited a drop in optimism about future agricultural exports as the primary reason for the weakened outlook from producers.
Michael Langemeier, the barometer’s principal investigator and director of the Purdue Center for Commercial Agriculture, said policy uncertainty is largely to blame.
“If you think about it, we’ve still got some uncertainty related to the Farm Bill, even though…that does seem to be moving through in a reconciliation bill,” Langemeier said. “We’ve still got uncertainty there, and we’ve also got a lot of uncertainty with trade and tariffs.”
The latest survey was conducted between June 9-13.
James Mintert, emeritus professor of agricultural economics at Purdue University, said over the last several months, producers’ answers to the question of whether they think ag exports are more likely to increase, decrease or stay the same has been rather volatile.
“Forty-one percent of producers this month said they expect ag exports to increase. That’s down from 52% who felt that way a month ago,” Mintert said. “When you look at the percentage of people who say they think exports will actually decline, you go back to March, 30% said they thought exports were going to decline. This month, it was only 16%.”
Producers were also asked if they believe free trade benefits agriculture and most other American industries. Only 31% of farmers in June said they strongly agreed with the statement, which is down from 49% when asked the same question in the fall of 2020.
“Overall, we see weakened agricultural producer sentiment coupled with their weakened expectations for the future,” said Langemeier. “Although farmers remain concerned that U.S. tariff policies will reduce their income, fewer producers in May and June said they expect a negative or very negative impact on their income than they did in March and April.”
You can learn more about the June Ag Economy Barometer by clicking here and in the video below.