Farmer sentiment improved in March as the Purdue University-CME Group Ag Economy Barometer Index rose from 116 points in February to 127, according to a Purdue University release.
The March barometer survey was conducted among 400 farmers across the nation from March 16-20.
CURRENT CONDITIONS INDES UP
The Current Conditions Index increased by six points, while the Future Expectations Index increased by 14 points, the Purdue release said. However, the Future Expectations Index this month was still 12 points below last year’s December index, and 16 points below last year’s March index.
The percentage of respondents who cited high input costs as their biggest concern increased from 44% to 46% this month, the university said. However, the percentage of respondents who thought the US was headed in the “right direction” and who expected land prices to be higher five years from now also increased.
About 18% of respondents indicated their farm operations were better off in March than they were a year ago, the report said.
Looking ahead 12 months, 18% expected worse financial performance, compared with 20% who expected better financial performance. The Farm Capital Investment Index rose by three points to 53.
However, only 4% of survey respondents indicated they planned to increase farm machinery purchases in the coming year, the release said.
INTEREST RATE QUESTIONS
This month’s survey included questions about inflation and interest rate expectations, the report said. About 39% of respondents expected inflation for consumers to be above 3%.
When asked whether the US prime interest rate would be lower, about the same, or higher 12 months from now, 34% of respondents indicated the belief that interest rates would be lower, while 16% said interest rates would be higher.
In this month’s survey, 12% of producers said that within the last six months, they had discussed leasing farmland they owned for solar energy production, the survey said. Lease rates varied considerably, with about 21% of reported lease rates above $1,500 an acre.
Fifty-six percent of respondents reported contract offers included an escalator clause, with the most commonly reported range being 2% to 3% per year. Overall, 5% of March survey respondents said either they or one of their landowners had signed a solar lease.
FARMLAND VALUES
The Short-Term Farmland Value Expectations Index increased from 123 to 125, and the long-term index increased from 150 to 159 this month, the release said. Alternative investments, net farm income, and interest rates were cited as the three factors having the greatest influence on farmland values.
As in the last few months, producers were asked whether the US was headed in the “right direction” or on the “wrong track.” The percentage of producers who indicated the US was headed in the “right direction” increased from 59% in February to 65% in March.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $241.83 per cwt to $246.79, compared with last week’s range of $234.90 to $243.63 per cwt. FOB dressed steers and heifers went for $378.68 per cwt to $388.53, compared with $370.42 to $377.81.
The USDA choice cutout Tuesday was down $5.30 per cwt at $382.74 while select was down $2.04 at $386.33. The choice/select spread remained inverted to minus $3.59 from minus 0.33 with 108 loads of fabricated product and 47 loads of trimmings and grinds sold into the spot market.
The USDA-listed the weighted average wholesale price for fresh 90% lean beef as $458.47 per cwt, and 50% beef was $157.64
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $0.90 to $1.05 a bushel over the May corn contract, which settled at $4.49, down $0.05.
No live cattle contracts were tendered for delivery Tuesday.
The CME Feeder Cattle Index for the seven days ended Monday was $364.59 per cwt, up $3.04. This compares with Tuesday’s Apr contract settlement of $368.90, down $3.12.