Schirmer Farms (Batesville) Operations Manager Brandon Schirmer, assisted by farm owner and father Ernie Schirmer, puts their tractor back together, near San Antonio, TX, on August 11, 2020. They are performing needed farm equipment repairs and maintenance in preparation for the upcoming cotton harvest.Farmers’ expectations for interest rate changes have shifted, which could explain why producers are looking for financial conditions to improve. This month, 48% of Purdue University/CME Group Ag Economy Barometer respondents expect a decline in the U.S. prime interest rate over the next year, up from 35% in December.

Just one-third of producers foresee an interest rate increase compared to 43% last month. Only 20% of respondents this month identified the risk of rising interest rates as a primary concern, a decrease from the 24% recorded in December 2023. High input costs remain producers’ top concern, with 36% of respondents expressing worry.

The Farm Capital Investment Index increased by 7 points this month, indicating a rise in optimism among farmers about making large investments. Producers who said it is a good time for a large investment rose to 15%, up from 11% at the start of the year.

Read more about the shift in farmer expectations here.