Farmer sentiment improved in July after three consecutive months of declines, according to the Purdue University/CME Group Ag Economy Barometer.
The barometer increased 13 points to 126, driven by stronger views of both current conditions and future expectations. The Current Conditions Index rose 20 points to 122, while the Future Expectations Index increased 11 points to 129. The survey included responses from 405 farmers nationwide collected July 13-17.
Despite the improvement in sentiment, producers continued to identify high input costs as their top concern, with 46% saying they are the biggest challenge facing their operation. Looking ahead five to 10 years, 30% of respondents said crop or livestock prices represent the greatest challenge to long-term success.
The Farm Capital Investment Index also recovered after three months of declines, rising to 50. Although most producers said their financial position has not improved over the past year, they expressed greater confidence about the year ahead. Thirteen percent reported being better off financially than a year ago, while nearly one-quarter expect their operation's financial position to improve during the next 12 months.
Michael Langemeier, principal investigator for the barometer and director of Purdue's Center for Commercial Agriculture, said stronger crop prices during the survey period likely contributed to the improvement in both farmer sentiment and the Farm Capital Investment Index. He noted that producers continue to face high input costs and uncertainty surrounding future crop and livestock prices, with strong interest in marketing education reflecting the need for strategies to manage an increasingly uncertain pricing environment.
After crop and livestock prices, respondents identified farm transition at 17% and cost control at 16% as the next most significant long-term challenges. Financial considerations and weather each received 13% of responses, followed by trade at 7% and government policy at 3%.
Those concerns were reflected in producers' educational priorities. Marketing ranked as the top risk management education need for 44% of respondents, well ahead of financial and strategic risk management.
As producers prepare for cash rent negotiations, most corn, soybean, wheat and cotton growers expect rental rates to remain stable in 2027. Nineteen percent anticipate rents will increase, compared with 7% who expect a decline. Among those expecting increases, most projected rents to rise between 5% and 10%.
The survey also found producers remain cautiously optimistic about agricultural exports. Forty-two percent expect U.S. agricultural exports to increase during the next five years, while 13% expect exports to decline. In addition, 56% believe new foreign export markets for U.S. agricultural products are likely to open during that period, down from 64% who expressed that view in July 2025.
Expectations for farmland values weakened in July. The Short-Term Farmland Value Expectations Index fell 6 points to 118, while the long-term index declined 14 points to 152. Respondents identified alternative investments, net farm income and interest rates as the factors they expect will have the greatest influence on farmland values.
The survey also tracked producers' views on the nation's direction. Fifty-four percent of respondents said they believe the United States is headed in the right direction, up slightly from 53% in June and 52% in May, but below the 71% average recorded during the final six months of 2025.
Source: Purdue University, "After 3 months of decline, farmer sentiment rebounds in July"