{"id":14045,"date":"2024-01-02T10:00:00","date_gmt":"2024-01-02T14:00:00","guid":{"rendered":"https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/?p=14045"},"modified":"2024-01-02T08:34:20","modified_gmt":"2024-01-02T12:34:20","slug":"u-s-farmer-sentiment-stable-as-inflation-expectations-subside-2","status":"publish","type":"post","link":"https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/u-s-farmer-sentiment-stable-as-inflation-expectations-subside-2\/","title":{"rendered":"U.S. farmer sentiment stable as inflation expectations subside"},"content":{"rendered":"\n<p>The latest report from the\u00a0<a href=\"https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/\">Purdue University\/CME Group Ag Economy Barometer<\/a>\u00a0indicates that U.S. farmers inflation expectations have subsided while overall producer sentiment changed little. The December barometer recorded a reading of 114, just one point lower than in November. Both sub-indices of the barometer, the Index of Current Conditions and the Index of Future Expectations, mirrored this slight decline, settling one point below their respective November figures at 112 and 115. Looking ahead to 2024, farmers inflation expectations in December were notably lower than those at the beginning of 2023. This month\u2019s Ag Economy Barometer survey was conducted from Dec. 4-8.<\/p>\n<div id=\"attachment_14047\" style=\"width: 310px\" class=\"wp-caption alignright\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-14047\" class=\"wp-image-14047 size-medium\" src=\"https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/wp-content\/uploads\/2024\/01\/AgEconomyBarometer_December2023-300x218.png\" alt=\"U.S. farmer sentiment stable as inflation expectations subside (Purdue\/CME Group Ag Economy Barometer\/James Mintert)\" width=\"300\" height=\"218\" srcset=\"https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/wp-content\/uploads\/2024\/01\/AgEconomyBarometer_December2023-300x218.png 300w, https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/wp-content\/uploads\/2024\/01\/AgEconomyBarometer_December2023-1024x743.png 1024w, https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/wp-content\/uploads\/2024\/01\/AgEconomyBarometer_December2023-768x557.png 768w, https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/wp-content\/uploads\/2024\/01\/AgEconomyBarometer_December2023-1536x1115.png 1536w, https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/wp-content\/uploads\/2024\/01\/AgEconomyBarometer_December2023-2048x1486.png 2048w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><p id=\"caption-attachment-14047\" class=\"wp-caption-text\"><strong>U.S. farmer sentiment stable as inflation expectations subside <\/strong>(Purdue\/CME Group Ag Economy Barometer\/James Mintert)<\/p><\/div>\n<p style=\"font-weight: 400\">Farmers reported another improvement in their farms\u2019 financial performance during the month of December. The Farm Financial Performance Index saw a 2-point increase compared to the previous month, marking a continued positive trend. Since late summer, the index has climbed 11 points, and at year-end, it was 21 points above the low point for 2023, which occurred in May.<\/p>\n\n\n\n<p>\u201cThe shift in farmers\u2019 perception of financial performance during the fall quarter corresponds with USDA\u2019s more optimistic 2023 farm income outlook released in late November which was\u00a0\u00a0$10 billion higher than their previous forecast,\u201d said\u00a0<a href=\"https:\/\/ag.purdue.edu\/commercialag\/ageconomybarometer\/team\/jim-mintert\/\">James Mintert<\/a>, the barometer\u2019s principal investigator and director of Purdue University\u2019s\u00a0<a href=\"https:\/\/ag.purdue.edu\/commercialag\/home\/\">Center for Commercial Agriculture<\/a>.<\/p>\n\n\n\n<p>The Farm Capital Investment Index reading of 43 was only one point above November\u2019s, but it marked a 13-point increase compared to the same period last year. Respondents endorsing the notion that now is a favorable time for substantial investments in their farm operation cited \u201chigher dealer inventories\u201d and \u201cstrong cash flows\u201d as key factors supporting this perspective. While the percentage of respondents selecting \u201cstrong cash flows\u201d as a rationale for investment rebounded from the previous month, it remained less popular than in July and August. Conversely, in December, the percentage of producers citing \u201chigher dealer inventories\u201d as a primary motivation for investment was more than double the proportion who expressed a similar sentiment in July.\u00a0<\/p>\n\n\n\n<p>\u201cHigh input costs continue to be concerning for U.S. farmers, although a notable shift in concerns took place as 2023 unfolded,\u201d said Mintert.&nbsp;<\/p>\n\n\n\n<p>Farmers concerned about the risk of lower prices for crops and livestock increased from 16% of respondents in January to over one-fourth (26%) by December. Number three on the list of concerns for the upcoming year was \u201crising interest rates,\u201d chosen by 24% of farmers in December\u2019s survey.<\/p>\n\n\n\n<p>Producers&#8217; inflation expectations moderated, with 70% expecting inflation in 2024 to be less than 4%. By comparison, 50% of the producers anticipated an inflation rate of 6% or higher a year ago. When asked about interest rates, about one-third of respondents said they anticipate rates declining in 2024 while 22% expect no change in interest rates in the upcoming year.<\/p>\n\n\n\n<p>Perspectives on farmland values weakened slightly in December compared to November. The Short-Term Farmland Value Index fell 4 points to a reading of 121, while the long-term index decreased by 2 points to 149. Compared to a year ago, the short-term index was down 3 points, while the long-term index was 9 points higher.<\/p>\n\n\n\n<p>\u201cThe improvement in farmers\u2019 interest rate expectations since late 2022 could help explain the year-to-year rise in farmer\u2019s long-term farmland value expectations,\u201d stated Mintert.<\/p>\n\n\n\n<p><strong>About the Purdue University Center for Commercial Agriculture<\/strong><\/p>\n\n\n<p>The\u00a0<a href=\"https:\/\/ag.purdue.edu\/commercialag\/home\/\">Center for Commercial Agriculture<\/a>\u00a0was founded in 2011 to provide professional development and educational programs for farmers. Housed within Purdue University\u2019s Department of Agricultural Economics, the center\u2019s faculty and staff develop and execute research and educational programs that address the different needs of managing in today\u2019s business environment.<\/p>\n\n\n<p><strong>About CME Group<\/strong><\/p>\n\n\n\n<p>As the world&#8217;s leading derivatives marketplace, CME Group (<a href=\"http:\/\/www.cmegroup.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">www.cmegroup.com<\/a>)&nbsp;enables clients to trade futures, options, cash and OTC markets, optimize portfolios, and analyze data \u2013 empowering market participants worldwide to efficiently manage risk and capture opportunities. CME Group exchanges offer the widest range of global benchmark products across all major asset classes based on&nbsp;<a href=\"http:\/\/www.cmegroup.com\/trading\/interest-rates\/index.html\" target=\"_blank\" rel=\"noreferrer noopener\">interest rates<\/a>,&nbsp;<a href=\"http:\/\/www.cmegroup.com\/trading\/equity-index\/index.html\" target=\"_blank\" rel=\"noreferrer noopener\">equity indexes<\/a>,&nbsp;<a href=\"http:\/\/www.cmegroup.com\/trading\/fx\/\" target=\"_blank\" rel=\"noreferrer noopener\">foreign exchange<\/a>,&nbsp;<a href=\"http:\/\/www.cmegroup.com\/trading\/energy\/\" target=\"_blank\" rel=\"noreferrer noopener\">energy<\/a>,&nbsp;<a href=\"http:\/\/www.cmegroup.com\/trading\/agricultural\/\" target=\"_blank\" rel=\"noreferrer noopener\">agricultural products<\/a>&nbsp;and&nbsp;<a href=\"http:\/\/www.cmegroup.com\/trading\/metals\/\" target=\"_blank\" rel=\"noreferrer noopener\">metals<\/a>.&nbsp; The company offers futures and options on futures trading through the&nbsp;<a href=\"http:\/\/www.cmegroup.com\/globex\/index.html\" target=\"_blank\" rel=\"noreferrer noopener\">CME Globex<\/a>\u00ae platform, fixed income trading via BrokerTec and foreign exchange trading on the EBS platform.&nbsp; In addition, it operates one of the world&#8217;s leading central counterparty clearing providers, CME Clearing.&nbsp;<\/p>\n\n\n\n<p>CME Group, the Globe logo, CME, Chicago Mercantile Exchange, Globex, and, E-mini&nbsp;are trademarks of Chicago Mercantile Exchange Inc.&nbsp; CBOT and Chicago Board of Trade are trademarks of Board of Trade of the City of Chicago, Inc.&nbsp; NYMEX, New York Mercantile Exchange and ClearPort are trademarks of New York Mercantile Exchange, Inc.&nbsp; COMEX is a trademark of Commodity Exchange, Inc. BrokerTec and EBS are trademarks of BrokerTec Europe LTD and EBS Group LTD, respectively.&nbsp;The S&amp;P 500 Index is a product of S&amp;P Dow Jones Indices LLC (\u201cS&amp;P DJI\u201d). \u201cS&amp;P\u00ae\u201d, \u201cS&amp;P 500\u00ae\u201d, \u201cSPY\u00ae\u201d, \u201cSPX\u00ae\u201d, US 500 and The 500 are trademarks of Standard &amp; Poor\u2019s Financial Services LLC; Dow Jones\u00ae, DJIA\u00ae and Dow Jones Industrial Average are service and\/or trademarks of Dow Jones Trademark Holdings LLC. These trademarks have been licensed for use by Chicago Mercantile Exchange Inc. Futures contracts based on the S&amp;P 500 Index are not sponsored, endorsed, marketed, or promoted by S&amp;P DJI, and S&amp;P DJI makes no representation regarding the advisability of investing in such products. All other trademarks are the property of their respective owners.<\/p>\n\n\n\n<p>Writer: Erin Robinson,&nbsp;<a href=\"mailto:erobin@purdue.edu\">erobin@purdue.edu<\/a>&nbsp;&nbsp;&nbsp;<br>Source: James Mintert, 765-494-7004,&nbsp;<a href=\"mailto:jmintert@purdue.edu\">jmintert@purdue.edu<\/a><\/p>\n\n\n\n<p>Media Contacts:<br>Aissa Good, Purdue University, 765-496-3884,&nbsp;<a href=\"mailto:aissa@purdue.edu\">aissa@purdue.edu<\/a><br>Dana Schmidt, CME Group, 312-872-5443,&nbsp;<a href=\"mailto:dana.schmidt@cmegroup.com\">dana.schmidt@cmegroup.com<\/a><\/p>\n\n\n\n<p>Related websites:<br>Purdue University Center for Commercial Agriculture:&nbsp;<a href=\"http:\/\/purdue.edu\/commercialag\">http:\/\/purdue.edu\/commercialag<\/a><br>CME Group:&nbsp;<a href=\"http:\/\/www.cmegroup.com\/\">http:\/\/www.cmegroup.com\/<\/a><\/p>\n\n\n\n<p>Photo Caption:\u00a0<br>U.S. farmer sentiment stable as inflation expectations subside (Purdue\/CME Group Ag Economy Barometer\/James Mintert)<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The latest report from the\u00a0Purdue University\/CME Group Ag Economy Barometer\u00a0indicates that U.S. farmers inflation expectations have subsided while overall producer sentiment changed little. The December barometer recorded a reading of 114, just one point lower than in November. Both sub-indices of the barometer, the Index of Current Conditions and the Index of Future Expectations, mirrored&hellip;<\/p>\n","protected":false},"author":19,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[7],"tags":[],"class_list":["post-14045","post","type-post","status-publish","format-standard","hentry","category-media"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>U.S. farmer sentiment stable as inflation expectations subside<\/title>\n<meta name=\"description\" content=\"Agricultural producers\u2019 sentiment increased for the second consecutive month, as the Purdue University\/CME Group Ag Economy Barometer index rose 5 points in November 2023.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, 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