For the first time since June 2025, farmers expect their operations to be better off financially a year from now rather than worse off, according to the August Purdue University/CME Group Ag Economy Barometer survey. The improved outlook pushed farmer sentiment from 126 in July to 135 in August.
The Index of Future Expectations increased 11 points, while the Index of Current Conditions rose only 1 point. Optimism about export prospects over the next five years also improved this month, reaching 140, the highest since December 2025. Higher input costs remained the biggest concern among the 402 farmers surveyed nationwide from Aug. 10-14.
The Farm Financial Performance Index rose from 90 at the beginning of the year to 103 in August, showing increased optimism among respondents about their financial outlook for the next 12 months. Despite this increase, the Farm Capital Investment Index declined by 5 points to 45.
This month’s survey featured three questions on operator skills. When asked to identify the skill with the most return on investment for their farm, 29% of respondents chose production skills, followed by financial management and analysis at 23% and strategic planning at 22%. When asked which skill their farm most needed to improve, strategic planning topped the list at 28%, followed by selling products at 20% and buying inputs at 19%. The third question asked which skills could be improved most through artificial intelligence, with strategic planning at 32%, financial management and analysis at 28%, and production at 18%.
“Producers are looking beyond the day-to-day management of their operations and thinking more strategically about the skills they need to succeed,” said Michael Langemeier, the barometer’s principal investigator and director of Purdue’s Center for Commercial Agriculture. “The emphasis on strategic planning, both as an area for improvement and as a potential application for artificial intelligence, suggests producers see opportunities to use new tools to strengthen decision-making.”
In August, the Short-Term Farmland Value Expectations Index rose by 8 points to 127. The survey identified alternative investments, interest rates and inflation as the top three influences on farmland values. When asked to evaluate farmland as an investment, 65% viewed it as a good investment, 17% as medium and 18% as poor.
Since July 2025, producers have been asked whether they believe the U.S. is moving in the “right direction” or on the “wrong track.” The average “right direction” response was 71% in the final six months of 2025 and 62% in the first quarter of 2026. Since April, the percentage of producers who feel the U.S. is heading in the right direction has fluctuated between 51% and 57%. In August, 51% of respondents said the U.S. was moving in the right direction.
