Optimism may be starting to sprout among farmers and ranchers, despite the impact COVID-19 is having on nearly every sector of agriculture. The latest Purdue University/CME Ag Economy Barometer showed a slight recovery for the month of May, up 7 points. That follows a dramatic drop in April when producer sentiments plummeted to 103. While outlooks start to improve, the Ag Economy Barometer is still nearly 40% below its all-time high of 168 set in February of this year.
The small boost in May could be attributed to the announcement of federal aid, according to James Mintert, the barometer’s principal investigator who also services as director of Purdue University’s Center for Commercial Agriculture.
“This month’s survey was conducted the same week that USDA announced the details of the Coronavirus Food Assistance Program (CFAP), so awareness of that program’s details could be one of the key reasons for this month’s barometer improvement,” says Mintert. “Yet some farmers remain worried about their bottom line and are still looking for options to alleviate those concerns.”
Mintert explains that the survey is a compilation of responses from 400 producers. Of those surveyed for the month of May, 70% say they are “very worried” about the impact of coronavirus on their farm’s bottom line. That’s up from 67% the month prior. The survey found the biggest concerns surround market access and financing.
Financing seems to be a growing worry. When asked about expectations for their financial position over the next 12 months, the survey found more than 60% expect farmers’ equity positions to decline throughout the upcoming year. That’s a sharp increase from the 28% who felt that way in February of this year. As concerns continue, two-thirds of farmers surveyed said they think it will be necessary for Congress to pass another bill to provide more economic assistance to U.S. farmers.