Farmer sentiment dropped seven points in August as both grain and oilseed prices fell.
Purdue and CME Group released their Ag Economy Barometer Tuesday. The barometer showed an August reading of 132, down from July’s 139. Purdue Economist David Widmar says the number is still stronger than a year ago when the index read 95.
“Producers are feeling better about their current financial realities. Tied into the election, producers are more optimistic about the future of the Ag economy and the U.S. broad economy as a whole.”
Widmar says the change in sentiment was primarily driven by the Index of Current Conditions.
It fell to 122 in August after reaching an all-time high of 142 in July. The Index of Future Expectations held fairly steady, dropping just one point from 138 in July to 137 in August.
“Weakness in the Index of Current Conditions compared to July wasn’t unexpected given the recent downtrend in grain and oilseed prices,” said Jim Mintert, director of Purdue’s Center for Commercial Agriculture and principal investigator for the barometer. “For example, from July 17 to August 21 – the first days of the July and August sentiment surveys, the December corn futures contract price declined 6 percent. Prices for wheat and soybeans also weakened, generating additional concern about farm revenues and profitability.”
Since hitting a peak of 153 in January, the barometer’s monthly readings have ranged from a low of 124 in March to a high of 139 in July.
Four hundred producers across the U.S. took the Ag Economy Barometer survey.