Optimism in Farmland Values Leads to Barometer Increase

WEST LAFAYETTE, IN – The Purdue University/CME Group Ag Economy Barometer improved 15 points to a reading of 136 in October. The upswing is attributable to 15-point increases in both of the barometer’s sub-indices. The Index of Current Conditions rose to a reading of 155 and the Index of Future Expectations rose to a reading of 146. Dr. Jim Mintert is Director of the Center for Commercial Agriculture at Purdue and explains that “farmers were more optimistic about farmland values increasing, and less inclined to think cash rental rates would decline, than in September”. When asked to look ahead in the farmland market, both 12 months and 5 years into the future, more producers said they expect farmland values to increase than in September. Meanwhile, just 14 percent of producers expect cash rental rates to decline in the upcoming year compared to 22 percent who thought a decline likely when surveyed in September. The Farm Capital Investment Index also saw an uptick, rising 12 points in October, after a two-month decline, as farmers were more favorably disposed toward making large investments in their farming operations.