WEST LAFAYETTE, Ind. – Farmers are worried about high input costs and rising interest rates, and that concern showed in the August Purdue University/CME Group Ag Economy Barometer, which fell 8 points from July to a reading of 115.

Producers were asked – as they have been for awhile – what their biggest concerns were for their farming operations, said James Mintert, director of Purdue’s Center for Commercial Agriculture. “The responses haven’t changed too much on this one,” he explained. “High input cost continues to be the number one concern of farmers. This month, 34 percent of the people in the survey chose that as their top concern or certainly one of their biggest concerns for the year ahead. The one that has changed a little bit over time here in recent months is we have been picking up more people saying that they’re concerned about rising interest rates (24 percent), but those are the top two concerns going forward.”

Respondents also noted lower crop and/or livestock prices (20 percent) and environmental and regulatory policy (9 percent) among their bigger concerns.

The monthly survey found farmers had a weaker perception of current conditions and future expectations on their farms and in U.S. agriculture. The current conditions index fell 13 points from July, to 108, while the future expectations index dropped 5 points to 119.

The ag barometer gauges the health of the U.S. agricultural economy. A value greater than 100 shows positive sentiment toward the economy. Values lower than 100 indicate negative sentiment. The survey of 400 U.S. producers was conducted Aug. 14-18. The results were released Sept. 5.

The responses show just how concerned producers are about high input costs, noted Michael Langemeier, the center’s associate director. “(That) would include interest costs and really what’s happened here is we took a big jump in 2022 and 2023 in terms of input costs and they’ve flattened out some,” he said. “If you look at the USDA NASS (National Agricultural Statistics Service) overall production input price, it’s pretty much been flat year to year, but the key there (is) it hasn’t come down. And we’re still dealing with some fairly high break evens for a lot of commodities. I focus on corn and soybeans. Those break evens are still considerably higher than what they were in 2021.”

Based on responses in the most recent survey, just a few farmers are concerned about the availability of inputs, Mintert said.

“It’s come down substantially, but a few people are saying they’re worried about availability of inputs,” Mintert stated. “It’s probably about half what it was earlier. We were picking up for awhile there, 15 percent or more people choosing that as one of their top concerns. We’re down to 7 percent now. We’re not hearing much about it other than just a little bit here in the survey.”

Langemeier said the amount of concern over input availability is similar to that of farm policy (6 percent), adding he thought farm policy would be a bigger concern. He said he thinks the reason for the overall lack of interest from respondents, especially for corn and soybean farmers, is that very little gross return has come from farm policy.

“It’s all come from the market,” he said. “People always remember what’s happened in the last couple years when they’re answering questions like this. At least that’s what I think they’re trying to do. And I think that’s being reflected in that percentage.”

The barometer’s farm capital investment index was down 8 points from the previous month, to 37. July’s 45 points was one of the highest readings seen in the barometer in quite some time, Mintert said.

Corn and soybean growers were asked about the usage of carbon contracts in row-crop agriculture. Six percent of corn and soybean growers said they have had discussions with companies about receiving payments to capture carbon on their farms; 2 percent said they had signed a carbon contract, Mintert said.

As for payment rates, 47 percent of respondents said they were offered $10-$20 per metric ton of carbon captured. Thirty two percent were offered less than $10 per metric ton, while 16 percent said they were offered $20-$30. Five percent said they were offered $30 or more.