Farmers' view of the ag economy improved modestly in July, despite continued fluctuations in commodity markets, according to a monthly survey by Purdue University and the CME Group.
The overall rating of farmer sentiment in the Ag Economy Barometer rose to a reading of 123, up from 121 in June and well above the 103 recorded in July 2022. The July increase followed a jump of 17 points from May to June.
Some 17% of farmers in July, up from 14% in June, said their operation is doing better financially than a year ago, while the share of farmers who say they are doing worse than last year dropped from 38% to 30% in July.
About 39% of farmers expect bad times for the farm economy over the next five years, down from 41% in June.
Purdue’s Jim Mintert said in a statement the increased optimism is happening “despite recent crop price volatility and continued concerns about rising interest rates.”
Nearly two-thirds of the producers surveyed — some 65% — expect interest rates to rise in the next year; some 57% said the same in June. Higher input costs remained the top concern for producers followed by worries about interest rates and lower output prices.
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“Given the volatility in commodity prices, especially crop prices, this spring and early summer it’s notable that more producers expressed concern about rising interest rates than declining output prices,” the report said.
This month’s survey also found a drop in the number of producers who say they’re using cover crops. In October 2022, 57% of respondents said they were planting cover crops on a portion of their farmland. In July, 45% of corn and soybean farmers said they are using cover crops. Soil health and erosion control remained the top reason for the practice in both reports.
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