The Purdue University/CME Group Ag Economy Barometer showed increased optimism about the agricultural economy in a mid-July survey taken before the latest escalation in the U.S.-China trade war.
The barometer measures farmer sentiment by surveying 400 producers each month to provide an index value. The July reading was 153, compared to 126 points in June, which was also a jump up by 52 points in the previous month of May. These numbers — gathered in a survey conducted July 15 through 19 — are timed in conjunction to when many producers were filing claims for prevented planting and still in the dark on the specifics of the USDA’s 2019 Market Facilitation Program. USDA announced MFP payment details the following week.
According to James Mintert, the barometer’s principal investigator and director of Purdue University’s Center for Commercial Agriculture, one driving factor to this index improvement is “the Corn Belt is continuing to see better crop conditions and that has farmers, at least momentarily, breathing a sigh of relief.”
The July survey notes slipping producer optimism for a speedy conclusion to the trade war. The July report states “78 percent of producers said they thought it unlikely the trade dispute would be resolved by September 1, compared to 68 percent who felt that way in June,” and the optimism continues to decline.
Survey participants also confirmed an uptick in prevented planting acres this year as 25% reported intentions to file a PP claim on intended corn acreage and 24% plan to do the same on intended soybean acreage. Overall, 61% of farmers responding to the survey said 15% or more of their intended corn acreage would be filed as a PP claim and 39% of soybean farmers said they did not plant between 15 and 25% of their intended soybean acreage. USDA plans to release an updated acreage forecast August 12.
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