WEST LAFAYETTE, Ind. and
CHICAGO, Jan. 10, 2017 /PRNewswire/ -- Producer
sentiment about the agricultural economy soared on the heels of
November's presidential election, according to the December
Purdue/CME Group Ag Economy Barometer report released January 10th.
The December survey results landed the barometer at an all-time
high reading of 132—a 16-point jump from the November survey. The
barometer is based on a monthly survey of 400 U.S. agricultural
producers.
Producer optimism surrounding both current conditions and,
especially, future expectations drove the increase. The Index of
Current Conditions rose to 102 from November's 87, while the Index
of Future Expectations increased from 130 in November to 146 in
December.
"Looking back at the data from the last several months, it's
apparent that we've seen a big swing in producers' expectations
about the future," said James Mintert, barometer principal
investigator and director of Purdue's
Center for Commercial Agriculture. "Although both the Current
Conditions and Future Expectations Indices increased the last
couple of months, it was the increase in the Index of Future
Expectations, which jumped 51 points since October to reach an
all-time high in December, that triggered the sharp rise in the
barometer."
Producers' improving sentiment doesn't seem to be driven by
changes in corn and soybean prices, Mintert said. For example,
March 2017 CBOT corn futures were
slightly weaker during the November and December survey periods
than during the October survey. On the soybean side, January 2017 CBOT futures were unchanged in
November and only slightly stronger in December than those during
the October survey collection period.
Additionally, improved economic sentiment extends beyond just
agriculture, said David Widmar, senior research associate and
leader of research activities for the barometer. In October and
December, producers were asked about their expectations for the
broad U.S. economy and the results were surprising.
"The contrast in sentiment from the October survey—three weeks
prior to the U.S. elections—and the December survey—five weeks
after the elections—is remarkable," Widmar said.
When asked in the October survey about their expectations for
the U.S. economy over the next 12 months, only 13 percent of
respondents said they expected it to expand, while 23 percent said
they expected it to contract. In the December survey, half of the
respondents expected economic expansion and only 13 percent
expected contraction in the year ahead.
"The improvement in optimism regarding the U.S. economy among
agricultural producers appears to parallel that of U.S. consumers,"
Widmar said.
The University of Michigan's Index
of Consumer Sentiment confirmed that observation with a rise from
87 in October to a 12-year high of 98 in December.
Read the full December Ag Economy Barometer report, including
producer sentiment about the next five years and the health of
their own operations, at http://purdue.edu/agbarometer. The site
offers additional resources, such as past reports, charts and
survey methodology, and a form to sign up for monthly barometer
email updates and quarterly webinars.
The Ag Economy Barometer, Index of Current Conditions and Index
of Future Expectations also are available on the Bloomberg Terminal
under the following ticker symbols: AGECBARO, AGECCURC and
AGECFTEX.
About the Purdue University
Center for Commercial Agriculture
The Center for Commercial
Agriculture was founded in 2011 to provide professional development
and educational programs for farmers. Housed within Purdue University's Department of Agricultural
Economics, the center's faculty and staff develop and execute
research and educational programs that address the different needs
of managing in today's business environment.
About CME Group
As the world's leading and most
diverse derivatives marketplace, CME Group (www.cmegroup.com) is
where the world comes to manage risk. CME Group exchanges offer the
widest range of global benchmark products across all major asset
classes, including futures and options based on interest rates,
equity indexes, foreign exchange, energy, agricultural products and
metals. Around the world, CME Group brings buyers and sellers
together through its CME Globex® electronic trading platform and
its exchanges based in Chicago,
New York and London. CME Group also operates one of the
world's leading central counterparty clearing providers through CME
Clearing and CME Clearing Europe, which offer clearing and
settlement services across asset classes for exchange-traded and
over-the-counter derivatives. CME Group's products and services
ensure that businesses around the world can effectively manage risk
and achieve growth.
CME Group is a trademark of CME Group Inc. The Globe Logo, CME,
Globex and Chicago Mercantile Exchange are trademarks of Chicago
Mercantile Exchange Inc. CBOT and the Chicago Board of Trade are trademarks of the
Board of Trade of the City of
Chicago, Inc. NYMEX, New York Mercantile Exchange and
ClearPort are registered trademarks of New York Mercantile
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Further information about CME Group (NASDAQ: CME) and its products
can be found at www.cmegroup.com.
Related website:
Purdue
University Center for Commercial Agriculture:
http://purdue.edu/commercialag
CME Group: http://www.cmegroup.com/
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SOURCE CME Group