Farm Director, KC Sheperd, recently had the chance to speak with Dr. James Mintert about the Ag Economy Barometer. Mintert is a professor and extension economist in the Department of Agricultural Economics and serves as director of the Center for Commercial Agriculture.
The Ag Economy Barometer goes back to the fall of 2015, Mintert said, and is a monthly phone survey of 400 farmers each month. A different 400 farmers are surveyed each month, Mintert added.
“We have got a big database of farmers we tap into, in fact, if you get a call from us, you shouldn’t get a call again for at least a year,” Mintert said.
The demographics are held constant, Mintert said, as the barometer is based on the U.S. Census of Agriculture and the value of farm production.
“On the crop side, we talk to corn, soybean, wheat, and cotton producers, and on the livestock side, we talk to beef, pork, and dairy producers,” Mintert said.
The most recent survey, Mintert said, suggested a modest improvement in farmer sentiment.
“If you look at it from a longer-term view, farmer sentiment is quite a bit lower than it was in late 2020 and early 2021, and down somewhat compared to a year ago,” Mintert said.
Producers have been asked each month in 2023 what their biggest concern is, Mintert said, and the most frequent answer is high input prices.
“This month, roughly twice as many people chose high input prices as their top concern, as chose lower crop and livestock prices,” Mintert said. “I think that speaks to the idea that we have not really recovered from what took place with respect to the pandemic and some of the related trade discussions that we had, and the impact that has had on the farm economy. It has left people in a state where even though farm incomes these last two years have been great, they are still kind of anxious and they are worried longer-term about a cost-price squeeze.”
Regarding where the farm economy is going, Mintert said he sees tighter margins for corn and soybean producers.
“The good news is that production costs are going down, and the bad news is, if we have normal production both in South America and in the U.S. next year, it is probably going to be lower prices and somewhat of a margin squeeze…,” Mintert said.
On the beef side, Mintert said returns will be favorable with cattle producers if there is enough forage supply.
Given the tightness of supplies and the fact that the cowherd has not begun to expand yet, Mintert said the highest prices of the cycle are still up ahead.
