Purdue/CME Group: Farmer Sentiment Weakens On Cloudy Trade Outlook


Farmer sentiment weakened in June as the Purdue University-CME Group Ag Economy Barometer fell to 146, down from 158 a month earlier. The shift in farmer sentiment was primarily attributable to a change in producer expectations for the future as the Index of Future Expectations dipped 18 points to 146. At the same time, there was little change in the Current Conditions Index, which fell just 2 points to 144.

Shifting perceptions regarding the agricultural export outlook appeared to be a key reason behind producers' weaker outlook, as fewer producers expressed optimism about future ag exports. Despite this month's declines, all three indices remained well above year-ago levels.

The June barometer survey took place from June 9-13, 2025.

Producers projected a somewhat weaker financial outlook for their farms in June than in May as the Farm Financial Performance Index fell 5 points to 104. This index has ranged from 101 to 111 since January. An index above 100 indicates U.S. farmers expect a stronger financial performance in 2025 than in 2024. Strong income prospects for the livestock sector, especially among beef producers, are helping support the farm income outlook.

Despite the small decline in the financial condition index, the Farm Capital Investment Index improved to 60, 5 points higher than in May and nearly matching April's reading of 61. The investment index rose because the percentage of farmers who said it's a good time to invest climbed to 24% in June, up from 19% in May, while the percentage of respondents who said it's a bad time to invest did not change.

Despite the investment index's improvement, it doesn't look like producers necessarily plan to follow through and invest in farm machinery. The percentage of producers who said they planned to reduce their farm machinery purchases this year compared to last year rose to 54% in June, up from 48% in May.

Wrapping Up

Agricultural producer sentiment weakened in May primarily because producers' expectations for the future weakened. A less optimistic view regarding U.S. agriculture's future export prospects appeared to be the biggest driver behind the shift in sentiment. Farmers remain concerned that the U.S.'s tariff policies could negatively impact their farms' income, but fewer producers in May and June said that they expected a negative or very negative impact on income than when tariff policies were the focus of attention in March and April.

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by Michael Langemeier and James Mintert, Purdue Center for Commercial Agriculture