Could 7, 2024
Farmer sentiment declines to lowest stage since June 2022 amid weakened monetary outlook
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Farmer sentiment declines to lowest stage since June 2022 amid weakened monetary outlook. (Purdue/CME Group Ag Economic system Barometer/James Mintert) |
WEST LAFAYETTE, Ind. — April witnessed a steep decline in U.S. farmer sentiment, as indicated by the Purdue University/CME Group Ag Economy Barometer, which fell 15 factors from March to a studying of 99. Each subindexes of the barometer additionally noticed declines: The Present Situation Index dropped by 18 factors to 83, whereas the Future Expectations Index fell by 14 factors to 106. The month marked the bottom farmer sentiment studying since June 2022 and the weakest present situation ranking since Could 2020. The sentiment decline was pushed by worries concerning the present monetary state of affairs on farms and anticipated monetary challenges within the coming yr. The April Ag Economic system Barometer survey was carried out from April 8-12, 2024.
“Farmers’ sentiment took a major hit in April, reflecting broader issues about monetary efficiency and farmland values,” mentioned James Mintert, the barometer’s principal investigator and director of Purdue College’s Center for Commercial Agriculture.
The Farm Monetary Efficiency Index declined to 76 in April, marking a 7-point drop from the earlier month and a 21-point lower from final fall’s peak of 97. This downturn displays farmers’ rising issues in regards to the upcoming yr’s monetary outlook, with fewer respondents anticipating higher or equal efficiency than final yr.
Farmers’ expectations concerning rates of interest and farmland values shifted in April’s survey. Solely 24% of respondents anticipate rates of interest rising over the subsequent yr, down from 32% in March. Fewer farmers this month additionally mentioned they anticipate to see farmland values rise over the subsequent yr, regardless of the modest enchancment of their rate of interest outlook, whereas extra farmers reported that they search for farmland values to carry regular. Within the April survey, simply 29% of producers mentioned they anticipate farmland values to rise within the upcoming yr, in comparison with 38% who felt that method in March. These shifts replicate farmers’ concern about farm monetary efficiency in 2024, outweighing their improved rate of interest outlook.
There’s rising curiosity in utilizing farmland for photo voltaic vitality manufacturing, and photo voltaic lease charges seem like rising. This month’s survey revealed a 7-point uptick in respondents reporting discussions with firms about photo voltaic vitality leases, reaching 19% in comparison with 12% in March. Particularly, discussions round photo voltaic leasing recommend demand for photo voltaic leases is rising, with 58% of farmers reporting lease price provides exceeding $1,000 per acre — up from 54% in March. Over one-fourth of respondents (28%) mentioned they have been provided a farmland lease price of $1,250 or extra per acre. Rising lease charges for vitality manufacturing may very well be beginning to affect farmland values, no less than in some areas. Amongst producers who mentioned they anticipate values to rise within the subsequent yr, 8% of respondents highlighted vitality manufacturing as a key purpose.
“Wanting forward, vitality manufacturing actions may present some help for farmland values and expectations in some areas,” Mintert mentioned.
Concerning the Purdue College Heart for Business Agriculture
The Center for Commercial Agriculture was based in 2011 to offer skilled growth and academic applications for farmers. Housed inside Purdue College’s Division of Agricultural Economics, the middle’s college and workers develop and execute analysis and academic applications that tackle the completely different wants of managing in immediately’s enterprise atmosphere.
About CME Group
Because the world’s main derivatives market, CME Group permits shoppers to commerce futures, choices, money and OTC markets, optimize portfolios, and analyze knowledge — empowering market contributors worldwide to effectively handle danger and seize alternatives. CME Group exchanges supply the widest vary of worldwide benchmark merchandise throughout all main asset courses primarily based on interest rates, equity indexes, foreign exchange, energy, agricultural products and metals. The corporate provides futures and choices on futures buying and selling by way of the CME Globex platform, mounted revenue buying and selling through BrokerTec and international change buying and selling on the EBS platform. As well as, it operates one of many world’s main central counterparty clearing suppliers, CME Clearing.
CME Group, the Globe brand, CME, Chicago Mercantile Change, Globex, and E-mini are emblems of Chicago Mercantile Change Inc. CBOT and Chicago Board of Commerce are emblems of Board of Commerce of the Metropolis of Chicago, Inc. NYMEX, New York Mercantile Change and ClearPort are emblems of New York Mercantile Change, Inc. COMEX is a trademark of Commodity Change, Inc. BrokerTec is a trademark of BrokerTec Americas LLC and EBS is a trademark of EBS Group LTD. The S&P 500 Index is a product of S&P Dow Jones Indices LLC (“S&P DJI”). “S&P®”, “S&P 500®”, “SPY®”, “SPX®”, US 500 and The five hundred are emblems of Normal & Poor’s Monetary Providers LLC; Dow Jones®, DJIA® and Dow Jones Industrial Common are service and/or emblems of Dow Jones Trademark Holdings LLC. These emblems have been licensed to be used by Chicago Mercantile Change Inc. Futures contracts primarily based on the S&P 500 Index aren’t sponsored, endorsed, marketed, or promoted by S&P DJI, and S&P DJI makes no illustration concerning the advisability of investing in such merchandise. All different emblems are the property of their respective house owners.
About Purdue College
Purdue College is a public analysis establishment demonstrating excellence at scale. Ranked among the many prime 10 public universities and with two faculties within the prime 4 in the US, Purdue discovers and disseminates data with a high quality and at a scale second to none. Greater than 105,000 college students examine at Purdue throughout modalities and places, together with practically 50,000 in individual on the West Lafayette campus. Dedicated to affordability and accessibility, Purdue’s primary campus has frozen tuition 13 years in a row. See how Purdue by no means stops within the persistent pursuit of the subsequent large leap — together with its first complete city campus in Indianapolis, the brand new Mitchell E. Daniels, Jr. Faculty of Enterprise, and Purdue Computes — at https://www.purdue.edu/president/strategic-initiatives.
Author: Morgan French, mmfrench@purdue.edu
Supply: James Mintert, 765-494-7004, jmintert@purdue.edu
Media contacts:
Aissa Good, Purdue College, 765-496-3884, aissa@purdue.edu
Dana Schmidt, CME Group, 312-872-5443, dana.schmidt@cmegroup.com
Agricultural Communications: (765) 494-8415;
Maureen Manier, Division Head, mmanier@purdue.edu
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