WEST LAFAYETTE, Ind. (Inside INdiana Business) — A monthly measurement of farmer’s outlook on the economy shows a sharp recovery from the early months of the pandemic. The September reading of the Purdue University/CME Group Ag Economy Barometer reached 156, up 12 points from August and 60 points higher than April.
Purdue ag economists say a second round of federal Coronavirus Food Assistance Program payments last month along with improving crop prices appeared to fuel much of the optimism.
The Purdue Center for Commercial Agriculture says cash soybean prices in west-central Indiana rose $1.00 per bushel from August to late September.
However, farmer’s increased optimism did not carry over into producers’ perspectives toward U.S. agriculture export prospects. In September, 58% of respondents said they expect agricultural exports to increase over the next 5 years, down from 67% who felt that way in August.
Purdue says the shift was primarily due to more producers indicating they expect exports to remain about the same in the future, rather than increase.
The ag barometer data also shows farmers are now more confident in making large investments, such as machinery, than any other point in 2020. The Farm Capital Investment Index rose in September to a reading of 73, the highest reading of the year.
“Farmers are more optimistic about their ability and willingness to make farm machinery purchases in 2020 than they were earlier in the year,” said Jim Mintert, director of the Purdue Center for Commercial Ag. “Back in April just 29% of the farmers intended to purchase about the same amount of farm machinery as they had a year earlier. In the September survey that had risen all the way to 49% a pretty significant improvement since spring.”
The Ag Economy Barometer is based on survey responses from 400 U.S. agricultural producers.
To view the full report, click here.