Farmer sentiment declined for the second straight month in June, as rising production costs continued to weigh on producers’ outlook, according to the latest Purdue University-CME Group Ag Economy Barometer.
The barometer fell from 119 in May to 113 in June. The Index of Current Conditions dropped 5 points, while the Index of Future Expectations fell 7 points. Purdue researchers surveyed 400 farmers nationwide between June 15 and 19.
High input costs remained producers’ top concern. Nearly half of respondents, 47 percent, identified input costs as the biggest issue facing their farms, while 23 percent cited low crop and livestock prices. In a separate question, 42 percent said high input costs were the primary factor limiting improvements in their financial position this year.
Only 12 percent of respondents said their farm operation was in a better financial position than it was a year ago. Looking ahead, 22 percent expect their farms to be better off financially over the next 12 months.
The Farm Capital Investment Index slipped one point to 40, its lowest reading since September 2024, reflecting continued caution about making major investments.
When asked what is holding back their farm’s financial outlook, 42 percent again pointed to input costs. Low commodity prices ranked second at 17 percent, followed by weather risk at 14 percent, policy uncertainty at 11 percent, labor and equipment concerns at 9 percent, and debt or financial pressure at 8 percent.
Researchers also asked producers about artificial intelligence and other data-driven technologies. Just 23 percent said the biggest benefit would be increased production. Fourteen percent pointed to labor savings, while 11 percent said reducing risk or uncertainty would be the greatest advantage. More than half of respondents, 52 percent, said they did not see a meaningful benefit from these technologies.
Even among those interested in data-driven tools, adoption challenges remain. Sixty-three percent said recommendations generated by those tools would sometimes be difficult to follow, while 22 percent said they would often be difficult to implement.
Farmers remained relatively optimistic about trade. Forty-three percent expect U.S. agricultural exports to increase over the next five years, while just 9 percent expect exports to decline. Nearly 85 percent agreed or strongly agreed that free trade benefits agriculture and most other American industries.
Outlooks for farmland values were mixed. The Short-Term Farmland Value Expectations Index declined from 130 in May to 124 in June, while the long-term farmland value index rose to 166, tying its all-time high. Respondents identified alternative investments, net farm income, and inflation as the biggest influences on farmland values.
The survey also found a slight improvement in producers’ views of the country’s direction. Fifty-three percent said the United States is headed in the “right direction,” up slightly from 52 percent in May but well below the 71 percent average reported during the second half of 2025.
Looking further ahead, optimism about agriculture softened. Thirty-two percent of respondents said they expect good times for agriculture over the next five years, down 17 percentage points from June 2025. Expectations differed sharply by sector, with 25 percent expecting good times for crop producers compared to 68 percent for livestock producers.
Purdue researchers concluded that while concerns over production costs and farm profitability continue to pressure producer sentiment, many farmers remain optimistic about the long-term value of agricultural land.