Pessimism about the future from agricultural producers nationwide increased to end 2017. According to a Purdue University survey, optimism was at the second-lowest rating of 2017 in December.
The Purdue/CME Group Ag Economy Barometer, a rating that measures optimism for future expectations and current conditions in agricultural economy, showed a decline in long-term optimism. The barometer rating is determined by a survey of 400 ag producers from across the country. In December, optimism about the future declined for the second straight month. However, optimism about current conditions and short-term expectations rose and was the second-highest since data collection began in 2015.
Chris Hurt, an agricultural economics professor at Purdue, said a decrease in long term optimism is at least partially due to the past four years of crop production. Since 2014, there has been an abundance in crop production, he said. Production has outweighed usage, causing prices to drop. This past year was no different.
Hurt said corn production across the state was the second-highest ever at 181 bushels per acre. Soybeans were similarly successful at 55 bushels per acre, marking the third-highest state yield ever for the crop.
Central Indiana, the region which includes Wabash County, saw yields hover right around the trend, 179 for corn and 55.5 for soybeans, Hurt said. These yields actually superseded the United States Department of Agriculture predictions for the area. However, prices are still expected to drop.
“Revenues will be generally reduced some for the 2017 crop,” Hurt said. “Margins were already tight and will continue.”
Local farmer Nolan Holloway, who farms in Grant, Wabash and Miami counties, said given the rough spring, he and plenty of other farmers are grateful. Holloway said corn crops seemed consistent and were within 10 to 20 bushels of one another.
“I think we’re fortunate to have what we have,” he said. “Corn is still soft, still a soft market.”
Still, prices aren’t great. Hurt said corn prices may rebound in 2018 since low prices may dissuade farmers from planting as much corn. Holloway concurred and said he will probably scale back corn acreage this coming spring. However, he said farmers still have to plant corn out of necessity due to crop rotation. Corn provides organic material following a harvest and removes nitrogen produced by a soybean crop. In turn, soybeans produce nitrogen needed for a strong corn crop.
“It doesn’t work on paper,” Holloway said of a drastic corn reduction. “In order to have a good bean yield you have to raise corn. You can’t get in when it’s good and out when it’s bad.”
The local soybean crop this year was not disappointing, Holloway said, given the circumstances. The date when soybeans were planted seemed to be the biggest factor. Just a four day difference made for a noticeable difference, the farmer said.
Falling prices are a definite factor in a farmer’s outlook for the future, Hurt said.
“(Farmers are wondering) where’s the bottom line,” he said of the continued low prices.