Better outlook for the future pushes farmer sentiment higher

November brought the highest farmer sentiment reading since June, with the Purdue UniversityCME Group Ag Economy Barometer jumping 10 points from October to 139. The increase was driven primarily by producers' more optimistic outlook for the future, as the Future Expectations Index climbed 15 points to 144, while the Current Conditions Index dipped 2 points to 128. November's survey is the first conducted after the late-October announcement of a U.S.-China trade pact that includes provisions to expand U.S. agricultural exports and revealed a notable improvement in producers' confidence in future export opportunities. Sentiment also received support from a sharp rise in crop prices between mid-October and mid-November. The barometer survey took place Nov. 10-14.

Producers were more optimistic about their farms' financial performance in November, with the Farm Financial Performance Index increasing by 14 points to 92. The percentage of producers expecting better financial results this year grew to 24%, up from 16% in October. A sharp rise in crop prices from mid-October to mid-November was a key driver of the expectation for better financial performance. For example, eastern Corn Belt prices for fall delivery of corn and soybeans increased 10% and 15%, respectively, during that period. The stronger financial outlook in the crop sector compensated for a weaker outlook in the livestock sector, where declining cattle prices weighed on financial expectations. Despite the improved farm financial outlook, the Farm Capital Investment Index fell 6 points to 56, with only 16% of respondents indicating that now is a good time to make major investments in their operations.

"Producers became more optimistic about U.S. agricultural trade prospects in November. That coincided with a rise in crop prices, which led to farmers' improved expectations for their farms' financial performance and an improvement in farmer sentiment," said Michael Langemeier, the barometer's principal investigator and director of Purdue's Center for Commercial Agriculture.

Producers were more optimistic about future agricultural trade prospects in November. In response to a question included in every barometer survey since January 2019, just 7% of respondents said they expect U.S. agricultural exports to weaken over the next five years, down from 14% in October and 30% in March. In a related question, 47% of corn producers indicated they expect soybean exports to increase over the next five years, while 8% anticipate a decline. The stronger trade outlook likely contributed to the overall improvement in sentiment observed in November.

A majority of producers in November reported that they still expect to receive a supplementary support payment from the U.S. Department of Agriculture, similar to the 2019 Market Facilitation Program (MFP). However, confidence in receiving the payment fell sharply in November: Only 16% of respondents said an MFP payment was "very likely," down from 62% in September. Still, when combining the "likely" and "very likely" categories, just over three-fourths of producers (76%) said they expect an MFP payment, compared to 83% in September. Regarding how they plan to use an MFP payment, 58% of respondents said they would use it to "pay down debt," up from 52% in October.

For the second month in a row, the Short-Term Farmland Value Expectations Index increased, reaching 116 in November, which is 3 points higher than October and 10 points above September. Farmers' long-term outlook on farmland values also improved, with the Long-Term Farmland Value Expectations Index increasing by 4 points to a record high of 165. The November survey also asked corn producers about their expectations for 2026 cash rental rates. Nearly three-fourths of respondents (74%) said they expect rental rates to remain roughly the same as this year, consistent with responses from the July and August surveys. The relatively strong outlook for cash rent further supports farmland values.

"The record-high reading of the Long-Term Farmland Value Expectations Index indicates that farmers retain an optimistic long-run outlook for agriculture," Langemeier said. "Although rising crop prices and improved trade prospects have bolstered optimism, producers remain cautious in their investment and production decisions, reflecting the short-term uncertainty they face."

The November survey asked corn producers about possible changes to their production practices in 2026 due to expected weak operating margins. Among those producers planning to make adjustments, two practices were highlighted most often: switching to lower-cost seed traits or varieties and reducing phosphorus applications. Producers followed up by pointing to reductions in corn seeding rates and nitrogen application rates as potential changes. Still, a substantial portion of producers (40%) said they do not plan to make any changes to their corn production practices in 2026.

Recent barometer surveys have included questions on farmers' attitudes toward 2025 policy shifts. A majority of respondents in November (59%) and October (58%) said they expect U.S. tariffs to ultimately strengthen the agricultural economy. This is lower than last spring, when 70% of respondents anticipated that tariffs would have a long-term positive effect. The percentage of producers expressing uncertainty about the long-term impact of U.S. tariff policy has risen in recent months. In October, 16% of respondents said they were uncertain, rising slightly to 17% in November, roughly double the 8% reported in April and May. Meanwhile, two-thirds of farmers (67%) in the November survey said the U.S. is headed in the "right direction," down from 72% in October.

About the Purdue University Center for Commercial Agriculture
The Center for Commercial Agriculture was founded in 2011 to provide professional development and educational programs for farmers. Housed within Purdue University's Department of Agricultural Economics, the center's faculty and staff develop and execute research and educational programs that address the different needs of managing in today's business environment.

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About Purdue University
Purdue University is a public research university leading with excellence at scale. Ranked among top 10 public universities in the United States, Purdue discovers, disseminates and deploys knowledge with a quality and at a scale second to none. More than 106,000 students study at Purdue across multiple campuses, locations and modalities, including more than 57,000 at our main campus locations in West Lafayette and Indianapolis. Committed to affordability and accessibility, Purdue's main campus has frozen tuition 14 years in a row. See how Purdue never stops in the persistent pursuit of the next giant leap — including its integrated, comprehensive Indianapolis urban expansion; the Mitch Daniels School of Business; Purdue Computes; and the One Health initiative — at https://www.purdue.edu/president/strategic-initiatives.

Sources and Notes block:
Source: Michael Langemeier, mlangeme@purdue.edu, 765-494-9557

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SOURCE CME Group