Farmer Survey Shows More Optimism

November brought the highest farmer sentiment reading since June, with the Purdue University/CME Group Ag Economy Barometer jumping 10 points from October to 139. The increase was driven primarily by producers’ more optimistic outlook for the future. As the future expectations index climbed 15 points to 144, while the current conditions index dipped two points to 128, the November survey is the first conducted after the late October announcement of a US-China trade pact that includes provisions to expand US agricultural exports. Dr James Mintert, an ag economist emeritus with Purdue University, highlights the results of a question that was included in the November survey regarding compensation paid to producers as a result of a tariff trade war.

“How likely do you think it is that farmers will receive compensation similar to 2019 market facilitation program, the percentage of farmers who overall think it's likely, or very likely, declined slightly to 76% down from 83% when we asked the same question in September. But there was a big change with respect to the percentage who think it is very likely versus likely. In September, 62% thought a MFP payment was very likely. This month, that was down to just 16%.”

IF an MFP is indeed issued, most producers in a survey said they would use it to pay down debt.