Key Takeaways
- The Purdue University/CME Group Ag Economy Barometer fell 12 points to 140 in March, reflecting lower U.S. Farmer Sentiment.
- Concerns over agricultural trade and farm policy contributed to declines in both future expectations and current conditions indices.
- The Farm Capital Investment Index and Farm Financial Performance Index also declined, though optimism about farmland values remained steady.
- Expectations for U.S. agricultural exports fell to a record low in the survey’s history.
- Farmers identified trade policy as the most important issue facing their operations, rising sharply in importance since late 2024.
U.S. Farmer Sentiment Drops in March as Trade and Policy Uncertainty Weigh on Outlook
Index of Future Expectations Sees Notable Decline
U.S. farmers expressed less optimism in March, according to the Purdue University/CME Group Ag Economy Barometer, which dropped 12 points to a reading of 140. The decline was driven largely by reduced expectations for the future, with the Index of Future Expectations falling 15 points to 144. The Current Conditions Index also declined by 5 points to 132.
Survey respondents cited falling crop prices since mid-February and growing concerns over agricultural trade and farm policy as key factors behind the shift in sentiment. Despite the drop, producers remained more optimistic about the future than the present, with the Future Expectations Index still 12 points higher than the Current Conditions Index.
U.S. Farmer Sentiment: Investment and Financial Performance Indices Also Decline
Capital Investment Sentiment Remains Elevated Relative to Recent Years
The Farm Capital Investment Index declined 5 points in March to 54. While down month-over-month, it marked the second-highest reading since June 2021. The Farm Financial Performance Index also fell by 8 points to 102.
Despite these declines, the financial index remaining above 100 suggests that, on average, farmers still anticipate modest improvements in financial performance compared to the previous year.
Farmland Value Expectations Hold Steady
Farmers Maintain Cautious Optimism on Land Prices
The Short-Term Farmland Value Expectations Index remained unchanged at 118 in March. The index has generally ranged between 110 and 126 since early 2023, with occasional dips during late summer and early fall 2024. The latest reading suggests that producers expect land values to remain stable or see modest increases over the next 12 months.
“While the overall sentiment shift in March reflects growing uncertainty, farmers remain cautiously optimistic about the future,” said Michael Langemeier, principal investigator of the Ag Economy Barometer and director at Purdue University’s Center for Commercial Agriculture.
Export Expectations Reach Survey Low
Producer Optimism on Trade Diminishes
In the March survey, 30% of producers said they expect a decline in U.S. agricultural exports over the next five years, nearly equaling the 33% who anticipate growth. This marks the lowest level of export optimism since the barometer began asking the question in 2019.
Producer expectations for export growth were strong in 2019 and 2020 but have trended downward since 2021, reflecting increased uncertainty in international trade dynamics.
Farmer Sentiment: Trade Policy Now Top Concern for Producers
Shift in Focus Since 2024 Election
Since the 2024 U.S. presidential election, trade policy has overtaken interest rates as the most cited concern among producers. In March, 43% of farmers surveyed identified trade policy as the most important issue for their operations over the next five years, compared to just 21% before the election.
The March results also showed that 52% of respondents believe a program similar to the 2019 Market Facilitation Program is “likely,” with another 13% saying it is “very likely.”
Additionally, 74% of farmers said that the passage of a new farm bill in 2025 is either “very important” (49%) or “important” (25%) to their operations, indicating continued attention on legislative developments impacting the agricultural sector.
Read the complete report here.
