Ag Economy Barometer: Optimism up in August

WEST LAFAYETTE, Ind. — Producers were less worried about their farm’s financial situation in August versus July, although they remain concerned about rising costs and inflation.

The Purdue University/CME Group Ag Economy Barometer rose 14 points in August to a reading of 117.

More producers indicated they’re expecting better financial performance for their farms in 2022 and the upcoming year. The Farm Financial Performance Index improved 11 points to a reading of 99.

Worries Continue

Farmers continue to be uncertain about the future costs of items on and off the farm.

When asked about their biggest concerns for the next year, over half of respondents chose higher input costs, followed by rising interest rates (14%), input availability (12%), and lower output prices (11%).

“On the farm level, there is a big disparity in opinions among farmers regarding whether or not input prices will retreat or escalate in 2023,” the report states.

Approximately 4 out of 10 producers expect crop input prices in 2023 to be either unchanged or possibly decline by as much as 10%, compared to 2022.

On the other hand, just over half of all producers expect input prices to rise from 1% to 20%.

Producers continue to view now as a bad time to make large farm machinery and building investments.

In a follow-up question, nearly half of those who said it is a bad time for investing cited increasing prices as the primary reason.

Read the full Ag Economy Barometer report at https://tinyurl.com/yc47zrdn.