US farmer sentiment continued to improve in May in the wake of increasing optimism over agricultural exports.
Released Tuesday, the Purdue University/CME Group Ag Economy Barometer was up 10 points from April to 158 in May, the highest since May 2021. The barometer is based on a monthly survey of producers across the country.
According to the barometer commentary, a key factor contributing to the climb in farmer sentiment may be linked to “a more positive view of the US’s long-run agricultural trade prospects.” In May, 52% of producers said they expect agricultural exports to increase over the next five years, surging from 33% in April and the highest percentage of positive responses to this question since November 2020.
On the other hand, just 12% of producers said they believe exports will decline, down from 24% the previous month.
Meanwhile, US producer views on free trade appear to be changing. In the May survey only 28% of farmer respondents ‘strongly agreed’ with the statement that free trade benefits agriculture and most other American industries. That is down sharply from almost half (49%) of respondents who strongly agreed with the statement during the fall 2020 surveys.
Additional evidence of changing views comes from responses to questions about the impact of US tariff policies on their farms’ income. In March and April, 57% and 56% of producers, respectively, responded that tariffs are likely to have a “negative” or “very negative” effect on their farm’s income. However, by May, only 43% of respondents said they expected a negative impact, while those indicating “no impact” rose to 30%, up from 19% in March and 22% in April.
In the April barometer survey, 70% of respondents said they believed the increased use of tariffs would eventually strengthen the US agricultural economy.
