Farmer sentiment diminishes in September
Farmers say they are less optimistic about current and future conditions as input costs rise in the latest Purdue University/CME Group Ag Economy Barometer.
Jim Mintert, director of the Purdue Center for Commercial Agriculture, tells Brownfield it’s their weakest survey rating since July of last year.
“The Ag Economy Barometer declined 14 points to a reading of 124 and if you go back to the spring, the barometer was up above 175,” he says. “There’s been a significant deterioration in farmer sentiment.”
This month’s survey found the farm capital investment index dropped 10 points and the percentage of farmers who plan to increase farm machinery purchases next year declined a little. Mintert says that’s partly because of tight machinery inventories.
“Over half, 55 percent of the farmers said yes—those tight machinery inventories were having an impact,” he says. “I think that suggestions what’s really going on is farmers would like to make some investments in the farm machinery but are unable to do some because they simply can’t get what they want to buy.”
Mintert says farmers are also concerned about inputs with more than a third of farmers expecting prices to rise by more than 12 percent.
“That’s roughly six times the average rate of increases that’s taken place over the last decade,” he says.
In addition, about half of farmers also expect cash rental rates to rise next year.