Farmer Sentiment Softened In June

Farmers are a little unsure of the ag economy right now.  Farmer sentiment weakened in June as the Purdue University-CME Group Ag Economy Barometer fell to 146, down from 158 a month earlier.

Purdue University’s James Mintert said the shift was thanks to a drop in the Index of Future Expectations, which slipped 18 points to 146.  Mintert added producers had a weaker financial outlook for their farms in June as the Farm Financial Performance Index fell five points month-over-month to 104.

“Somewhat surprisingly, the investment index rose five points to 60, nearly matching April's reading of 61, and the percentage responded saying it's a good time to invest, actually rose to 24%, up from 19% back in May," Mintert said.  "However, despite the improvement in the Capital Investment Index, it does not look like producers plan to follow through and invest in farm machinery, at least here in the short run.  54% of the response in this month's survey said they planned to reduce their investment in farm machinery this year compared to last year. That's up from 48% who felt that way a month earlier.”

What Impact Are Tariffs Having On Farm Country?

When it comes to the question of tariffs, Mintert said 46% of respondents said they expect to see a negative or very negative impact from tariffs on their farm income; an increase from the 43% who felt that way in May.  He added the overall concern about a negative impact on farm income from tariffs is starting to lessen.  When it comes to the question of the long-term impact tariffs could have on the heath of the U.S. Ag economy.

“A majority of US producers continue to say that they think the use of tariffs by the US will strengthen the US economy in the long run," he noted.  "Although the percentage who felt this way in June did decline modestly to 63% compared to 70% who felt that way in April and May.”

Click Here for additional numbers and details from the Purdue University-CME Group Ag Economy Barometer.

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