Significant Prevented Plantings in U.S.
CHICAGO - Aug 6/19 - SNS -- Prevented plantings rose sharply this year because of a delayed start to seeding in the United States, according to results of a survey conducted for the Purdue University/CME Group Ag Economy Barometer.
The USDA will publish its results later in the month. But, this preliminary survey of 400 farmers across the U.S. found 25% of corn and soybean growers said they are filing a prevented planting claim on some of their intended corn acreage while 24% on some of their soybean acreage.
Producers who indicated they submitted a claim, were asked what percentage of their intended acreage they will claim as prevented planting. Of those, 61% of the farmers filing a prevented corn planting claim said the area totaled 15% or more of their intended corn acreage and 42% said that they did not plant 25% or more of their intended acreage.
Among soybean growers, 39% who are submitting a prevented planting claim said they did not plant between 15% and 25% of their intended soybean acreage.
In contrast to corn growers, however, just 2% of soybean farmers with a prevented planting claim said they were not able to plant 25% or more of their intended soybean acreage. See this month's report for charts that provide more detail on farmers' responses regarding their 2019 prevented plantings of corn and soybeans.
Farmer Business Sentiment Improves
Despite issues over prevented plantings, farmers were more optimistic in July than was the case in June. The Purdue University/CME Group Ag Economy Barometer humped 27 points to 153 in July, up 52 points from May. Results are based on a survey of 400 agricultural producers across the U.S. conducted from July 15 through July 19, 2019, which was prior to USDA's announcement of 2019 MFP payment rates.
A big driver of sentiment was producers' improved expectations for current economic conditions. The Index of Current Conditions, a sub-index of the ag barometer, increased 44 points in July to a reading of 141, marking the largest one-month improvement since data collection began in October of 2015. The barometer's other sub-index, the Index of Future Expectations also increased, up 18 points from June, to a reading of 159 in July.
Producers were also asked whether they feel now is a good time or bad time to make large investments in their farming operations. In July, the Large Farm Investment Index improved to a reading of 67, up 25 points from June and 30 points from May.
This increase marked both the largest 2-month improvement in the index since data collection began in fall 2015 and the highest reading for the index since February 2018.
Sentiment also spilled over into their expectations for increased land values. Short-term, the percentage of producers expecting land values to increase in the upcoming 12 months jumped from just 10% in June to 21% in July, the highest percentage expecting an increase in values since February 2018. Long-run, 53% of producers said they expect values to rise over the next 5 years compared to 45% who felt that way in June and 39% in May.
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