Ag Economy Barometer: Farmers show more optimism about ag economy

WEST LAFAYETTE, Ind. — Farmers were encouraged by strengthened commodity prices, but are still worried about high cost inflation, according to the Purdue University/CME Group Ag Economy Barometer.

The barometer increased eight points to a reading of 121. It remains 32% below its reading from a year ago.

Rising prices for major commodities, especially corn and soybeans, appear to be leading the change in producers’ improved financial outlook.

“The Farm Financial Performance Index improved significantly this month to a reading of 95, compared to a reading of 87 last month,” said James Mintert, director of the Center for Commercial Agriculture at Purdue.

“Producers are starting to feel somewhat better about their farm’s financial situation in 2022 compared to 2021.”

The Farm Capital Investment Index, however, did not improve — remaining at an all-time-low of 36 from March to April.

Over 40% of producers say purchase plans are impacted by low machinery inventory levels, and farmers continue to say that higher inputs costs are a top concern.

In April, 42% chose higher input costs as their biggest concern, which was more than twice as many who chose government policies, at 21%, or lower output prices, at 19%.

Sixty percent of farmers said they expect input prices to rise by 30% over the next 12 months.

Read the full Ag Economy Barometer report at purdue.ag/agbarometer.