Producers Remain Optimistic About About Ag Economy

(WEST LAFAYETTE, IN) Agricultural producer sentiment held steady in November with producers remaining optimistic about the state of the agricultural economy, according to results from the Purdue University/CME Group Ag Economy Barometer. The November barometer reading of 134 was slightly lower than October but on par with levels seen last spring before trade disruptions began. The barometer utilizes a survey of 400 agricultural producers from across the country. In addition, the barometer’s two sub-indices remain mostly unchanged from October; the Index of Current Conditions at 115, and the Index of Future Expectations dropped slightly to 143. Confidence can be seen in producers’ attitudes towards their willingness to make large farm investments. Each month producers are asked whether now is a “good time” or “bad time” to make a large investment in buildings and machinery. In November, that investment index hit 56 points, up from 52 in October but ten points higher than in September when the index set a new low of 42. Producers were also more optimistic regarding their long-term perspective on farmland values, with 50 percent expecting higher farmland values over the next 5 years. This increase in confidence was not driven by expected improvements in profitability, however. In November, only 13 percent of respondents said they expect farm profitability to improve in the next 12 months, and 44 percent expect to see equity diminish in the upcoming year.