Why Did the US Farmers Keep Pessimistic Attitude on Economy？

The newest results indicate that the highest farmer optimism since January of 2017. The biggest reason is that the May barometer was 16 points higher than April. The rise in the barometer, a sentiment index derived from a monthly survey of 400 agricultural producers across the U.S., was driven both by producers’ improved view of current waterproof shade net conditions in the production agriculture sector and, especially, their more optimistic view of the future.

Driving that optimism was a large improvement in producers’ expectations regarding the future for both the U.S. ag economy and their own farms’ financial condition, according to Jamest Mintert, the barometer's principal investigator and director of Purdue University'sCenter for Commercial Agriculture.

Over the last month, there's been a relaxation in international trade tensions with China, and that seems to be playing a role in how producers are viewing their financial future. This was in contrast to last month's reading when, in the midst of deteriorating trade relations, there was a decline in sentiment toward the agricultural shade net  economy as a whole and with respect to producers' own farming operations,” barometer officials stated in the press release.

Despite the improvement in sentiment, producers’ perspectives on making large investments on their farms changed very little with only 27% of producers saying now is a good time to make large farm investments, according to the press release.

More specifically, when asked about the current ARC-County (Agricultural Risk Coverage) and PLC (Price Loss Coverage) income support programs included in the 2014 farm bill, only one quarter of the respondents said these programs were effective in providing a financial safety net, and nearly one third said they were not effective, according to the release.  

When asked about crop insurance, an integral part of current farm bill discussions, nearly two thirds of producers considered the crop insurance program to be effective in providing a financial safety fence net.