The latest Ag Economy Barometer shows concern from farmers about falling farm gate prices, rising interest rates and future export uncertainty.
Given the factors, the overall barometer dipped by five points this month to a reading of 125. It's the first drop of the reading in three months.
Higher input costs were identified as the biggest risk ahead by 38% of farmers, while nearly one-quarter of the surveyed producers said rising interest rates are their biggest concern. Seventy-two percent believe it's a bad time to make capital investments, with 27% of those respondents citing rising interest rates as the primary reason.
Producers' export outlook reached its lowest level on record in February, with only 18% expressing confidence U.S. exports will grow over the next five years. The value peaked at just over 70% in 2020 and hit 33% in last month's survey. A report accompanying the results noted a “lack of confidence in future agricultural export growth is contributing to the weak sentiment among producers.”
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Over the next five years, a total of 16% of producers are planning to retire or exit the profession. This is the highest percentage in the past seven years of data collection. An additional 33% of farmers said they have “no plans to grow” over the next five years.
Purdue University and the CME Group publish the Ag Economy Barometer on the first Tuesday of each month. Data is collected from 400 agricultural producers through telephone surveys.
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