Agricultural producers are feeling pretty good about the future, according to the December 2016 results of the Purdue/CME Group Ag Economy Barometer, released today.
The barometer shows optimism among ag producers rising for the second month in a row, hitting its highest level since they started collecting data in October 2015.
The barometer has two subcomponents: the Index of Current Conditions and the Index of Future Expectations. Both increased in November and December compared to the months before, with optimism about the future growing particularly dramatically.
Purdue/CME Group noted a few interesting things about the results:
- The increased optimism was not related to corn and soybean prices. During the survey period, corn prices were down a little, while soybean prices were “virtually unchanged.”
- Ag producers’ optimism went beyond agriculture to the economy in general. It also extended out 5 years in the future — 71% of producers expect “widespread good times” over the next 5 years, compared to 35% in October 2016.
- 32% of respondents believe that their farm operation will be better off financially a year from now, while 65% report that they are worse off than a year ago.
- The majority think that 5 years from now will be a better time than now to bring a new generation into a family farming operation.