Monday, April 17, 2017

Farmers' expectations 'have blown the roof off,' says economist who created Ag Confidence Index

While farmers are concerned about current conditions, optimism about the future is sky high, according to DTN/The Progressive Farmer's Agricultural Confidence Index. The survey, which tracks farmer opinions of their current and future conditions, had an overall score of 130 in March, "a significant improvement from the mostly neutral 98 for the December 2016 survey and a complete flip from the pessimistic 75 score produced in spring 2016," Greg Horstmeier reports for DTN.

"Since 2010, DTN has surveyed farmers three times a year to determine their opinions about their current economic situation and about that situation in the year to come," Horstmeier writes. "Those answers create a score for farmers' 'current condition,' how they feel about their businesses at the time of the survey, and a score for their 'future expectations' for the coming year. Those two scores are combined to create the Ag Confidence Index."

When asked about current conditions, the score was 70, "pessimistic, but much higher than the 42 farmers gave conditions back in December," Horstmeier writes. But when asked about the future, the number jumped to 163.6, up from 126.6 in December and 71.7 a year ago.

Robert Hill, economist and researcher who helped create the index, said the high numbers could be attributed to news headlines around the time of the survey, Horstmeier writes. That includes President Trump signing an executive order to rollback the waters of the U.S. rule, "a regulatory refinement of the Clean Water Act, potentially called for heavier regulation of pesticide applications." Also, that same week, House Republicans unveiled their bill to replace the Obama administration's Patient Protection and Affordable Care Act.

Hill told Horstmeier, "Expectations have blown the roof off, more than doubling the index scores of 12 months back. This completely overwhelms the negative movement in present situation to yield a highly positive overall confidence index."

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