Farmers surveyed as part of the Purdue/CME Group Ag Economy Barometer indicated more optimism in July because of better commodity prices expectations this fall.
The monthly survey for July reached 139, its highest level since January 2017, and its second-highest level since data collection began in October 2015. The increase continues a trend seen over the summer of more optimism regarding the future of the agriculture economy. The forward-looking measure of sentiment, the Index of Future Expectations, climbed seven points in July to 138. A measure above 100 indicates optimism, while a measure below 100 indicates pessimism regarding the farm economy.
In July, farmers were asked if they expect to see higher, lower, or about the same grain, oilseed and cotton prices in the next 12 months. Many indicated they expected to see higher commodity prices through the next year. The improvement in producers’ expectations for commodity prices corresponded with early summer market activity.
Wheat futures prices, driven by drought conditions in the Northern Great Plains, have been the most active, but uncertainty about the corn and soybean growing seasons has also contributed to market volatility.