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November brought the highest farmer sentiment reading since June, with the Purdue University/CME Group Ag Economy Barometer jumping 10 points from October to 139.
The increase was driven primarily by producers’ more optimistic outlook for the future, as the Future Expectations Index climbed 15 points to 144, while the Current Conditions Index dipped 2 points to 128. November’s survey is the first conducted after the late-October announcement of a U.S.-China trade pact that includes provisions to expand U.S. agricultural exports and revealed a notable improvement in producers’ confidence in future export opportunities.
Sentiment also received support from a sharp rise in crop prices between mid-October and mid-November. The barometer survey took place Nov. 10-14.
The percentage of producers expecting better financial results this year grew to 24%, up from 16% in October. A sharp rise in crop prices from mid-October to mid-November was a key driver of the expectation for better financial performance. For example, eastern Corn Belt prices for fall delivery of corn and soybeans increased 10% and 15%, respectively, during that period.
The stronger financial outlook in the crop sector compensated for a weaker outlook in the livestock sector, where declining cattle prices weighed on financial expectations.
A majority of producers in November reported that they still expect to receive a supplementary support payment from the U.S. Department of Agriculture, similar to the 2019 Market Facilitation Program (MFP). However, confidence in receiving the payment fell sharply in November: Only 16% of respondents said an MFP payment was “very likely,” down from 62% in September.
Purdue University
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