Farmer sentiment declines in September, inflation expectations jump –


WEST LAFAYETTE — The Purdue College/CME Group Ag Financial system Barometer declined in September, down 14 factors to a studying of 124.

With producers feeling much less optimistic about each current circumstances on their farming operations As properly as to their anticipateations for The Prolonged time period, That is the weakest farmer sentiment studying since July 2020 when the index stood at 118.

The Index of Current Conditions declined 12 factors to a studying of 140 and the Index of Future Expectations fell 16 factors to a studying of 116.

The Ag Financial system Barometer is calculated every month from 400 U.S. agricultural producers’ responses to a telephone survey. This month’s survey was carried out Sept. 27-29.

The Farm Monetary Efficiency Index was unchanged from final month with a studying of 110. Neverthemuch less, analyzing the detailed responses reveals there was a shift amongst producers with regard to their farms’ financial performance.

In September, fewer farms said they anticipated their farm’s financial performance to match final yr’s, whereas The possibilities of producers anticipating each worse and greater financial performance rose.

“Although the mixed responses left the Farm Monetary Efficiency Index unchanged from a month earlier, the growing divergence in anticipateations amongst respondents from August to September might mirror variations in how particular person farms managed hazard in a interval of quickly fluctuating commodity prices,” said James Mintert, the barometer’s principal investigator and director of Purdue College’s Center for Enterprise Agriculture.

The decline in farmer sentiment spilled over into the Farm Capital Funding Index, which declined 10 factors to a studying of 43, down 50% As a Outcome of The start of the yr and The backside investment index studying since April 2020.

Fewer farmers this month said they deliberate To enhance their equipment buys than on the August survey as simply 8% of respondents plan To enhance buys, down from 10% final month.

In a Adjust to-up question, over half (55%) of respondents reported that their farm equipment buy plans have been impacted by low farm equipment inventories, probably contributing to weak sentiment relating to whether or not Now’s An environment nice time to make huge investments.

Although plans for equipment buys fell, producers’ plans For mannequin spanking new enhancement rose this month with 13% anticipating To enhance enhancement of grain bins and farm buildings, up from 8% in August.

Producer considerations about rising enter prices rose sharply this month with over one-third of respondents saying they anticipate enter prices to rise by Higher than 12% Inside The approaching yr, which is six occasions The typical farm enter inflation price of the final decade.

Inflation anticipateations have been greater this month throughout the board with The share of respondents anticipating enter inflation to rise above 12% doubling since July with An enhance to 34%, up from 21% final month.

Regardmuch less of September’s decline in farmer sentiment, farmers stay bullish about farmland values. The Brief-Term and Prolonged-Term Farmland Values Expectations Indices rose this month, with the long-time period index hitting a doc-extreme studying of 159, which is 4 factors greater than the earlier month.

The short-time period index rose 9 factors to 155, which is its third-extremeest studying since knowledge assortment started in 2015. Furtherextra, about one-half of corn/soybean growers proceed to say they anticipate farmland money rental prices to rise above 2021 ranges in 2022.

Among growers who anticipate money rents To enhance, 44% said they anticipate rental prices to rise from 5 To diminish than 10%, and three out of ten respondents indicated they anticipate prices to rise by 10% or extra.

In early 2020, about 70% of producers anticipated agricultural exports To enhance over The subsequent 5 yrs. Since then, farmer anticipateations relating to future agricultural commerce prospects have proceedd to weaken with Just a few exceptions.

September doced The backside proportion (37%) of growers anticipating agricultural exports To enhance As a Outcome of the question was first posed early final yr. Concerns relating to The biggest method forward for agricultural commerce Could be one other problem behind weak spot Finally Expectations Index.


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