For the second month in a row, farmers’ sentiments declined during September’s survey as the Purdue University-CME Group Ag Economy Barometer dropped nine points to 106.
Producers were concerned about the current situation and future performance prospects for their farms, with weaning crop prices, high production costs, and interest rates weighing on farmer sentiment, dropping all three indexes below last year’s levels. The survey was taken Sept. 11 to 15.
While the Farm Financial Performance Index remained unchanged in September at 86, responses to questions changed with increases in producers who either expected better or worse conditions than last year.
Meanwhile, three-fourths of producers still believe it’s a bad time to make large investments. Although the Farm Capital Investment Index rose just two points, 40 percent of producers feel it’s a bad time to invest considering rising interest rates, up from 35 percent last month and 14 percent from July 2022. Respondents who indicated that now is a good time to invest noted that strong cash flow on their farms was a reason to invest.
Among top concerns for farmers this month were high input costs, with one-third of respondents indicating that as their number one concern. In second place were rising interest rates and lower corp or livestock prices.
Farmland values remained strong, with the Short-Term Farmland Value Expectations Index unchanged at 126 and with long-term index rising 2 points to 153. Increases in farmland value are still largely credited to non-farm investment demand for farmland.
Each month, the survey poses specific questions. This month’s focused on corn and soybean growers to learn more about their perspective on cover crops. Over half (52 percent) of the growers surveyed said that they currently plant cover crops on part of their farms, but nearly half (47 percent) said they only use cover crops on 25 percent of their acreage.
The top two reasons cited by cover crop users for planting cover crops were improved soil health and improved erosion control. Farmers who tried planting cover crops and chose to discontinue their use pointed to varied reasons for dropping cover crops from their rotation, including saying it was not profitable, followed by hurts crop yields, insufficient soil benefits, and a lack of resources to plant cover crops