Key Takeaways
- Farmer sentiment in the U.S. improved modestly in October, with the Purdue University/CME Group Ag Economy Barometer rising three points to 129.
- The Index of Current Conditions increased 8 points, while the Index of Future Expectations remained largely unchanged.
- Livestock producers remain optimistic due to record-high beef profitability, while crop producers continue to face tight margins.
- The Farm Financial Performance Index fell to 78, but the Farm Capital Investment Index rose 9 points to 62.
- A majority of respondents plan to use potential USDA payments to reduce debt or bolster working capital.
Farmer Sentiment Improves Slightly in October
Farmer sentiment across the United States edged higher in October, according to the latest Purdue University/CME Group Ag Economy Barometer, which rose three points to a reading of 129. The gain was driven by improved views on current conditions, particularly among livestock producers, while longer-term expectations remained stable.
The Index of Current Conditions climbed to 130, up 8 points from September, while the Index of Future Expectations rose only slightly to 129. The survey, conducted between October 13–17, reveals that optimism remains uneven across sectors, with livestock producers expressing confidence and crop producers reporting greater financial strain.
Livestock Optimism Offsets Crop Sector Pressures
The latest data highlight what analysts described as a “tale of two economies.” Livestock producers benefited from record-high returns, particularly in the beef market, while crop producers continued to report challenges tied to lower commodity prices and higher input costs.
“U.S. farmers are adjusting to ongoing economic pressures in different ways,” said Michael Langemeier, principal investigator for the barometer and director of Purdue’s Center for Commercial Agriculture. “Livestock producers are seeing strong returns and remain optimistic, while many crop producers are contemplating management changes for 2026 to help cope with tighter margins.”
Farmer Sentiment Indexes Reveal Financial Divergence
Despite the modest improvement in overall farmer sentiment, financial indicators signal continued stress. The Farm Financial Performance Index fell to 78, down 10 points from September, marking its lowest level since early 2024. The index has declined steadily since May, when it reached 109.
By contrast, the Farm Capital Investment Index increased by 9 points to 62, reflecting some producers’ willingness to reinvest in operations—primarily within the livestock sector. Crop producers, however, remain hesitant amid rising costs and weaker profit margins.
Producers Focus on Financial Stability
When asked how they would allocate potential USDA supplemental payments, 53% of respondents said they would use the funds to pay down debt, while 25% would strengthen working capital. Smaller portions indicated they would invest in farm machinery (12%) or cover family living expenses (11%), signaling a cautious approach toward spending.
The data suggest that while farmer sentiment remains positive overall, most producers are prioritizing liquidity and debt management over expansion or new investment.
Short-Term Farmland Outlook Strengthens
The Short-Term Farmland Value Expectations Index rose 7 points to 113, reversing four months of declines. About 30% of producers now expect farmland values to increase over the next year, compared to 24% in September. Only 17% anticipate a decline.
Meanwhile, producers were asked about their plans for 2026 in response to ongoing low corn prices. Nearly one-third (30%) said they do not plan to make changes, while 29% plan to reduce phosphorus applications, 27% intend to adopt lower-cost seed traits, and 16% expect to cut nitrogen use.
Trade and Policy Uncertainty Continue to Influence Farmer Sentiment
Trade policy remains a key factor shaping farmer sentiment. In October, 58% of producers said they expect tariff use to increase as a means of supporting the agricultural economy. However, 16% said they were uncertain about tariffs’ long-term effects, double the rate reported in the spring.
Despite this uncertainty, about 70% of respondents said they believe the U.S. agricultural sector is moving in the right direction, suggesting cautious optimism even as cost pressures persist.
Farmer Sentiment Reflects a Divided but Resilient Agricultural Economy
The October report from Purdue University and CME Group underscores a mixed outlook across American agriculture. Farmer sentiment has stabilized following several months of fluctuation, with livestock producers driving modest gains while crop producers continue to face constrained profitability.
Read the complete U.S. Farmer Sentiment barometer here.
