U.S. Farmer Sentiment Improves
CHICAGO - Feb 4/20 - SNS -- Farmer sentiment in the United States improved in January in response to the conclusion of a Phase One Trade Agreement between the U.S. and China.
Producer sentiment in the Purdue University/CME Group Ag Economy Barometer jumped 17 points from December to a reading of 167.
Although the Index of Current Conditions was essentially unchanged, up one point to a reading of 142, the Index of Future Expectations jumped significantly, up 24 points since December to a reading of 179.
Although few details are available regarding how the additional $200 billion in purchases by China that is referenced in the agreement will be distributed over the next two years, and just how much impact it will have on the U.S. farm sector, signing of the agreement between China and the U.S. did appear to provide a boost in sentiment among producers.
For example, in January, 69% of farmers surveyed felt that the soybean trade dispute with China would be settled soon, up from 54% in December, and 80% felt that the outcome will be favorable to U.S. agriculture, up from 72% in December.
At the same time, producers' expectations for an increase in U.S. agricultural exports over the next five years has also steadily improved.
As recently as October of 2019, only 55% of producers expected agricultural exports to increase in the upcoming five years. However, starting in November 2019 and continuing through January 2020, about 70% of those surveyed said they expect to see an increase in U.S. agricultural exports in the next five years.