WEST LAFAYETTE, Ind. (RFD News) — U.S. farmer sentiment improved for a second straight month in August, driven primarily by greater optimism about future financial conditions and export opportunities. The Purdue University-CME Group Ag Economy Barometer rose nine points to 135.
The Index of Current Conditions increased just one point, while the Index of Future Expectations jumped 11 points. For the first time since June 2025, more producers expected their farms to be financially better off next year than worse off.
Financial expectations improved, but investment confidence weakened. The Farm Financial Performance Index reached 103, while the Farm Capital Investment Index fell five points to 45.
High input costs remained the top concern for 45% of respondents. Producers also cited low crop and livestock prices and higher interest rates as continuing challenges.
Farmland expectations strengthened, with 65% calling farmland a good investment and the short-term farmland value index rising eight points to 127.
CME Executive Director of Agricultural Research Fred Seamon joined us on Friday’sMarket Day Reportto discuss the latest Ag Economy Barometer.
Seamon said producer expectations for the future rose more than 8.5% in August. For the first time since June 2025, more producers expect their operations to be better off financially a year from now than worse off.
The survey also found producers viewed production skills as providing the greatest return on investment, while strategic planning was identified as the skill most in need of improvement and the area that could benefit most from artificial intelligence.
Farmland expectations remained strong, with 65% of respondents viewing farmland as a good investment compared with 18% who considered it a poor investment.
Despite that optimism, Purdue University economist Michael Langemeier said many farmers are still holding back on large capital purchases as high input costs remain a concern.
“That’s a pretty cautious form of optimism. I think that’s the key takeaway from the August survey. Farmers are becoming more optimistic about the future, but they’re not necessarily ready to act on that optimism by making large capital investments, and given that high input costs remain the number one concern, that caution makes sense.”
Langemeier said he will be watching in the coming weeks and months to see if financial conditions continue to improve and whether that translates into more capital purchases.
