Future Expectations Dragging Purdue Ag Economy Barometer Lower

WEST LAFAYETTE, IN – Since its peak in October of 2020, the Ag Economy Barometer has fallen 9 percent, attributable to weaker expectations for the future. The Barometer, a monthly project from Purdue University and the CME Group Ag Economy Barometer dropped 7 points in January (167), while the Index of Current Conditions remained relatively flat (199) and the Index of Future Expectations fell 10 points (151). Overall, the Index of Future Expectations has fallen 19 percent since October, while the Index of Current Conditions increased 12 percent over the same time period.

According to Dr. Jim Mintert, Director of the Center for Commercial Agriculture at Purdue explained the ongoing strength in the Current Conditions Index appears to be driven by the ongoing rally in crop prices, while the deterioration in the Futures Expectations Index seems to be motivated by longer-run concerns about policies that could impact U.S. agriculture in the future. Confidence that the on-going trade dispute with China will ultimately be resolved in a way that favors U.S. agriculture has waned, falling 12 points in January to 38 percent.
(SOURCE: All Ag News)