A new survey from Purdue University says that America’s farmers are more optimistic about current and future conditions on their farms despite recent concerns over President Trump’s tariff strategy and lower commodity prices. Notably, a majority of producers surveyed said they believe the increased use of tariffs will ultimately benefit the U.S. ag economy.
The Purdue University/CME Group Ag Economy Barometer rose 8 points to a reading of 148, up from 140 in March. The Index of Current Conditions climbed 9 points to 141, while the Index of Future Expectations increased 8 points to 152. The improvement in sentiment came amidst ongoing tensions with many of U.S. agriculture’s largest trading partners, including Mexico, Canada and China. The April barometer survey took place between April 14-21.
Producers seem to be gaining confidence in the ag economy’s longer-term outlook in spite of concerns they have about the impact of tariffs. This month’s results suggest some producers are starting to look beyond near-term uncertainty and focus more on positioning their farms for the future.
The Farm Capital Investment Index rose to 61 in April, a 7-point increase from March and the highest investment index reading since May 2021. Since the November 2024 election, there has been a marked shift in producers’ attitudes toward large investments. From May through October 2024, the index averaged just 36, while the average from November through April grew to 54 — a 50% increase from the previous six months. This month, one out of four producers said it was a good time to make large investments, nearly twice the percentage of respondents who said it was a good time to invest when surveyed from May through October last year.
Despite a rise in investment sentiment, nearly two-thirds of producers in April’s survey still said it was a bad time to invest, suggesting persistent caution among a majority of U.S. farmers. That group’s outlook helps explain the sharp decrease in new farm equipment sales that took place during 2025’s first quarter. According to the Association of Equipment Manufacturers, sales of tractors with over 100 horsepower fell 19% in the first quarter of 2025 compared to the same period in 2024, while new combine sales were down 38% from a year earlier.
The Farm Financial Performance Index held steady in April, dipping just one point from last month to a reading of 101. This marks the fourth consecutive month the index has remained above 100, indicating that producers, on average, continue to expect their farm’s financial performance this year to match or modestly exceed last year’s results.
Expectations for short-term farmland values weakened in April, as the index fell 8 points to a reading of 110. This change was driven by a decrease in the number of producers anticipating higher farmland values in the coming year, balanced by a comparable increase in the percentage of producers expecting values to remain about the same.
The April survey included several questions focused on the impact of the U.S.’s tariff policy on U.S. agriculture. Even with the improvement in overall sentiment, farmers remain concerned about the near-term effects of U.S. trade policy. Over half (56%) of respondents said they expect the U.S. tariff policy to have a negative or very negative impact on their farm’s income in 2025, and 53% anticipate some difficulty in obtaining inputs as a result of higher import tariffs. Among those expecting supply challenges, fertilizer was the primary cited concern, followed by parts for farm machinery and electronics and crop chemicals.
Despite the concerns expressed by farmers in the April survey about the impact of tariffs on farm incomes and availability of inputs for their farm operations, 70% of respondents said they expect the increased use of tariffs to strengthen the U.S. agricultural economy over the long term.
Source: Purdue Center for Commercial Agriculture.
