Farmer sentiment declines amid weaker view of current conditions

U.S. farmers’ sentiment dropped 8 points (6.6%) in August, according to the Purdue University/CME Group Ag Economy Barometer, fueled mostly by weaker perception of current conditions both on their farms and for U.S. agriculture. The Current Conditions Index fell 10.7%, while the Future Expectations Index declined 4.0%. The overall ag barometer was 1.7% lower than August 2022.

Although farmers reported little change in their farms’ financial condition compared to a month earlier, conditions were reported to be weaker than last year. Six out of 10 farmers in the August survey said they expect interest rates to rise over the next year, which along with rising prices for farm machinery and new construction, was cited as a reason for a weaker investment climate. Despite concerns about rising interest rates, producers remained cautiously optimistic about farmland values in both the short-run and longer-term.

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