WEST LAFAYETTE, IN. — Confidence in the future, despite continued financial strain, provided a surprising improvement in farmer sentiment ahead of the US presidential election, according to the Purdue University/CME Group Ag Economy Barometer.

The monthly survey of farmers, taken from Oct. 14-18, saw an overall reading of 115, 27 points higher than September on the strength of a 30-point jump to 124 for the Future Expectations Index.

Comments provided by survey respondents this month indicate that politics and policy are top of mind for many US farmers. Many producers expressed worries about potential policy changes impacting their farms and the agricultural economy, with regulation, environment and taxes featured prominently alongside price concerns.

“While producer sentiment improved in October, many respondents indicated they are still feeling financial strain due to the deterioration of their financial situation throughout 2024,” said James Mintert, the barometer’s principal investigator and director of Purdue University’s Center for Commercial Agriculture. “Over half of the producers we surveyed reported that their farm’s financial condition was worse than a year ago, which underscores the ongoing challenges producers face despite their more optimistic outlook for the year ahead.”

Producers this month expressed some optimism that economic conditions will improve and not precipitate an extended downturn in the farm economy. The percentage of producers who expect bad times for the US agricultural economy in the upcoming year declined from 73% of respondents in September to 53% in October. Similarly, the percentage of producers who expect bad times for US agriculture in the next five years fell to 33% from 48%.

The Current Conditions Index also rose in October, but by a smaller amount. With a reading of 95, the Current Conditions Index confirmed that farmers think economic conditions this year are worse than last year and weaker than during the barometer’s base period of 2015-16, which was in the early days of a multi-year downturn in the US farm economy. 

October’s survey provided another surprise with the increase in the Farm Financial Performance Index. The October reading of 90 jumped 22 points above September’s and was just 2 points lower than a year earlier. High fall crop yields and a stress-free fall harvest season in the Corn Belt and Plains states likely contributed to the index’s rise, according to the report.

Another factor likely contributed to the sharp rise in the Financial Performance Index, the Farm Capital Investment Index rose 7 points to 42, a sign that producers in October may view 2024’s weak economic prospects as transitory.

The Short-Term Farmland Value Expectations Index tends to be correlated with financial performance expectations, according to the report, and that was the case in October, with the index climbing up to 120, 25 points above the September reading. The long-term index also rose, improving to 159 versus 147 a month earlier. 

“Once again, the rise in both farmland value expectation indices suggests that producers retain some optimism about the agricultural economy’s future strength, which, in turn, could support farmland values,” the report said.

The November barometer survey, to be conducted one week following the presidential election, is expected to provide an update on how the election’s outcome affects producers’ outlook.