Economic sentiment among producers continued its downward trend in August, with the Purdue University/CME Group Ag Economy Barometer falling for the third consecutive month.
Dr. Jim Mintert from Purdue’s Center for Commercial Agriculture, the author of the report, said the index dropped 10 points to a reading of 125, down from 135 in July.
“The index did fall 10 points this month to a reading of 125, so that’s down from 135, and as you mentioned, it’s the third straight month of decline in the barometer,” Mintert said. “The Index of Future Expectations was the driver of the decline this month. It was down 16 points, which puts it at a reading of 123. The Current Conditions Index really didn’t change much—it was up two points from July to a reading of 129. So, the significant change was people becoming less optimistic about the future, and that pulled the barometer down overall.”
Mintert said it’s not surprising that livestock producers were the most optimistic segment of the industry.
“We always take a look at crop producers versus livestock producers,” he said. “And if you really drill down on that, it’s clear the optimism in the barometer is primarily coming from the livestock sector—especially beef cattle producers. We’re seeing record-high profitability for cow-calf operations and very strong profitability for cattle feeders as well. The negativity is really coming from the crop side.”
Mintert said farmers’ No. 1 concern continues to be production costs, particularly high input costs.