Farmer sentiment declined sharply in April, as indicated by the Purdue University/CME Group Ag Economy Barometer, which fell 15 points from March to a reading of 99, said Purdue University Agricultural Economist James Mintert, in a release.
The April Ag Economy Barometer survey was conducted from April 8-12, 2024.
Both sub-indexes of the barometer also declined, Mintert said. The Current Condition Index dropped 18 points to 83, while the Future Expectations Index fell 14 points to 106.
LOWEST READING IN TWO YEARS
April marked the lowest farmer sentiment reading since June 2022 and was just three points higher than in April 2020, he said. This April’s current condition rating was its weakest since May 2020.
The sentiment decline was driven by worries regarding the current financial situation on producers’ farms and anticipated financial challenges in the coming year, Mintert said.
April’s decline in farmer sentiment reflected broader concerns about financial performance and farmland values, he said. The Farm Financial Performance Index declined to 76 in April, marking a seven-point drop from the previous month and a 21-point decrease from last fall’s peak of 97.
The downturn reflected farmers’ growing concerns about the upcoming year’s financial outlook, with fewer respondents expecting better or equal financial performance than last year, Mintert said.
INTEREST RATE OUTLOOK BETTER
Farmers’ expectations regarding interest rates and farmland values shifted in April’s survey, he said. Only 24% of respondents anticipated interest rates rising over the next year, down from 32% in March.
Despite the modest improvement in their interest rate outlook, fewer farmers this month said they expected to see farmland values rise over the next year while more farmers reported that they looked for farmland values to hold steady, Mintert said.
In the April survey, just 29% of producers said they expected farmland values to rise in the upcoming year, compared with 38% who felt that way in March, while 17% of respondents said they looked for values to weaken compared with 14% in March, he said. These shifts reflected farmers’ concern about farm financial performance in 2024, outweighing their improved interest rate outlook.
SOLAR ENERGY INTEREST
There is growing interest in using farmland for solar energy production, and solar lease rates appear to be increasing, Mintert said. This month’s survey revealed a seven-point uptick in respondents reporting discussions with companies about solar energy leases, reaching 19% in April compared with 12% in March.
Discussions around solar leasing suggested demand is increasing, with 58% of farmers reporting lease rate offers exceeding $1,000 per acre — up from 54% in March, he said. Twenty-eight percent said they were offered a lease rate of $1,250 or more.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $185.08 per cwt to $188.84, compared with last week’s range of $182.00 to $186.75 per cwt. FOB dressed steers, and heifers went for $286.69 per cwt to $292.18, compared with $286.41 to $290.67.
The USDA choice cutout Tuesday was down $0.27 per cwt at $298.49 while select was up $2.59 at $292.34. The choice/select spread narrowed to $6.51 from $9.01 with 79 loads of fabricated product and 21 loads of trimmings and grinds sold into the spot market.
The weighted average USDA listed wholesale price for fresh 90% lean beef was $338.57 per cwt, and 50% beef was $78.80.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $1.36 to $1.44 a bushel over the Jul corn contract, which settled at $4.67 a bushel, down $0.02.
The CME Feeder Cattle Index for the seven days ended Monday was $239.53 per cwt, down $0.52. This compares with Tuesday’s May contract settlement of $242.15, up $0.75.