WEST LAFAYETTE, Ind. and
CHICAGO, Jan. 8, 2019 /PRNewswire/ -- There was a
modest drop in agricultural producer sentiment in December as
farmers' perception of both current and future economic conditions
weakened, according to results from the Purdue
University/CME Group Ag Economy Barometer. The December
barometer reading of 127 was 7 points lower than November. The
barometer is based on 400 survey responses from agricultural
producers across the country.
Both of the barometer's two sub-indices declined in December:
the Index of Current Conditions fell 6 points to 109, and the Index
of Future Expectations fell 8 points to 135. When comparing these
readings to December 2017, the Index
of Current Conditions is substantially lower, registering a decline
of 30 points, while the Index of Future Expectations actually
improved from year-to-year with an uptick of 15 points.
"Over the course of the last year, producers' impression of
current economic conditions on their farms has declined markedly"
said James Mintert, the barometer's
principal investigator and director of Purdue
University's Center for Commercial Agriculture. "But at the
same time their expectations for future economic conditions have
held steady," said Mintert. "As a result of this mixed view,
farmers appear to be cautious about making large investments in
their farming operations."
For example, in December 2018 the
Large Farm Investment Index, which measures whether producers feel
this is a good time to make large farm investments, fell 5 points
to a reading of 51. This marked a 29 point drop from one year ago
when it reached a reading of 70. Those same concerns were also
apparent when producers were asked whether now is a "good time" or
"not a good time" to bring a new generation of family into the
business. Just 42 percent said now was a "good time" compared to
approximately half during the previous two years. However, when
looking ahead 5 years, 65 percent of producers expect conditions to
be more favorable to onboarding a new generation.
International agricultural trade issues continue to cause
concern and could be causing producers' reduced confidence in
current economic conditions. When producers were asked whether they
expect exports to increase or decrease in the next five years, 59
percent indicated that they expect ag exports to increase, down 7
points from November's survey response, whereas 26 percent expect
ag exports to decrease, up from 10 percent on the November
survey.
Read the full December Ag Economy Barometer report at
http://purdue.edu/agbarometer. This month's report includes
additional information about farmers usage of and perceived value
of incorporating drone technology into their farm's operation as
well as their production expectations for the pork, beef, and dairy
industries. Each month Dr. Mintert also provides an in-depth
analysis of the barometer. That video is available at
http://purdue.edu/agbarometer.
The Ag Economy Barometer, Index of Current Conditions and Index
of Future Expectations 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)
enables clients to trade futures, options, cash and OTC markets,
optimize portfolios, and analyze data – 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 interest rates, equity indexes, foreign
exchange, energy, agricultural
products and metals. The company offers futures and
options on futures trading through the CME Globex® platform, fixed
income trading via BrokerTec and foreign exchange trading on the
EBS platform. In addition, it operates one of the world's
leading central counterparty clearing providers, CME
Clearing. With a range of pre- and post-trade products and
services underpinning the entire lifecycle of a trade, CME Group
also offers optimization and reconciliation services through
TriOptima, and trade processing services through Traiana.
CME Group, the Globe logo, CME, Chicago Mercantile Exchange,
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Inc. CBOT and Chicago Board
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property of their respective owners.
Writer: Kami Goodwin,
765-494-6999, kami@purdue.edu
Source: Jim Mintert,
765-494-4310, jmintert@purdue.edu
Related website:
Purdue
University Center for Commercial Agriculture:
http://purdue.edu/commercialag
CME Group: http://www.cmegroup.com/
Photo Caption: Ag Producers' sentiment drifts lower;
trade disputes continue to concern farmers according to latest
Purdue/CME Group Ag Economy Barometer.
(Purdue/CME Group Ag Economy
Barometer/James Mintert)
A publication-quality photo is available at
https://news.uns.purdue.edu/images/2019/december-barometer.jpg
CME-G
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SOURCE CME Group