The Purdue/CME Group’s June survey shows producers are a little more optimistic about their financial position than they were last year. The shift is why the June index reading of 131 was unchanged from the May survey.
The index has held steady for three straight months and remains well above the low levels of last November. The shift in producer expectations is a long-term trend. At this time last year, just three percent of the producers who responded felt their operation was better off financially than the previous year. That number jumped to 10 percent last fall, dropped a bit in winter, and rebounded to its current level of 13 percent, the highest reading since the survey began in 2015.
The shift is likely based on several factors, including farm revenues, which increased after large yields in 2016. Production costs also dropped from the previous year, as did many farmland rental rates.