Despite a slow harvest, farmer optimism about the ag economy strengthened in October.
The Purdue/CME Group Ag Economy barometer, which measures the sentiment of 400 producers, returned to 2018 levels with a reading of 136, a 15-point jump from the September figure. Jim Mintert, the director for Purdue’s Center for Commercial Agriculture, told Agri-Pulse despite yields for fall-harvested crops being below last year, in most situations, they are better than what people expected a few months ago.
He said the increase in the reading can also be attributed to the decreased pessimism regarding the U.S.-China trade dispute. In July, 75% of producers surveyed thought it was unlikely the U.S. and China would settle their trade dispute, a number that dropped to 51% in October.
When it comes to Congress ratifying the U.S.-Mexico-Canada Agreement, only 55% of producers surveyed said they expect an agreement to be approved soon.
Mintert said even though October’s reading was the same as last October, outstanding yields drove producer’s optimism then, despite having weak prices in the soybean market, specifically with products going to China. This year, he said producers are looking at reduced yields but stronger than expected prices, combined with Market Facilitation Program payments. Some 62% farmers surveyed anticipate another round of payments for the 2020 crop year.
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