A measurement of the mood in farm country dropped for the second straight month as concerns about slipping prices emerge among the already-potent worries about the input costs producers will face in 2023.
The October Ag Economy Barometer fell in October to levels consistent with late 2015 and early 2016. The similarity, the barometer’s monthly report noted, is “interesting because this year’s weakness in farmer sentiment is taking place despite very strong net farm income compared to the earlier period.”
According to USDA figures adjusted for inflation, net farm income across 2021 and 2022 is 40% higher than the 2015-2016 average.
When asked about their farm’s future financial performance, more than 40% of producers pointed to high input costs as their top concern; rising interest rates (21%) were the second largest worry. But about 13% of producers say lower commodity prices are a top concern, and a similar percentage are worried about input availability.
The October survey also asked a handful of policy questions as Capitol Hill gears up for farm bill deliberations. When crop producers were asked what policies or programs would be most important to their farms over the next five years, 36% of respondents said interest rate policy followed by 27% who identified crop insurance.
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The current Agriculture Risk Coverage and Price Loss Coverage programs are well received by producers, with 72% rating the safety net programs as very (11%) or somewhat (61%) effective. Crop insurance got a slightly more positive response with 84% of respondents calling it very (28%) or somewhat (56%) effective.
The report is a monthly project of Purdue University and the CME Group. The October figures are based on a survey of 400 producers queried Oct. 10-14.
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