Farmer Sentiment Weakens Due to Cloudy Trade Outlook

Farmer sentiment weakened in June following two months of improvement, as tracked by the Purdue University/CME Group Ag Economy Barometer. The barometer dropped 12 points to 146 from the previous month. A change in producers’ expectations for the future served as the primary factor in the shift, with the Index of Future Expectations sinking 18 points to 146. The Current Conditions Index, however, lost only 2 points, standing now at 144. A drop in optimism about future agricultural exports seems to have influenced producers’ weakened outlook. Even with the June declines, all three indices persist at higher levels than a year ago. The barometer survey took place between June 9-13.

Overall, we see weakened agricultural producer sentiment coupled with their weakened expectations for the future. Reduced optimism about the future of U.S. agriculture’s export prospects stands out as a major cause of the this month’s shift in sentiment. Although farmers remain concerned that U.S. tariff policies will reduce their income, fewer producers in May and June said they expect a negative or very negative impact on their income than they did in March and April.