The Purdue University/CME Group Ag Economy Barometer found that agricultural producer sentiment rose slightly in June.
The barometer reading for June was two points higher than in May at 143.
“In June, we saw a sizeable drop in commodity prices that caught many observers by surprise,” James Mintert, the barometer’s principal investigator and director of Purdue University’s Center for Commercial Agriculture, said. “But, despite the price decline, producers’ appraisal of current economic conditions improved compared to May. However, it was clear from survey responses that uncertainty regarding the agricultural outlook increased considerably.”
Further, the Index of Current Conditions climbed to 138 compared to a reading of 132 in May. The Index of Future Expectations remained roughly the same at 146 in June 1 point higher than May.
The June barometer survey also found that most farmers’ crop acreage did not change in 2018 compared to a year earlier. Also, 36 percent reported they plan to use a flexible cash rent lease on some of their acreage.
“Flexible cash rent leases provide a way for farm operators to share some risk with landowners, while also providing landowners some of the stability that comes with a cash rental agreement. The increase in volatility in crop agriculture could be stimulating interest in flexible cash rent leases,” Mintert said.
The barometer polled 400 agricultural producers from across the country.