U.S. farmers retained their post-election optimistic outlook at the start of the new year, according to the January Purdue University/CME Group Ag Economy Barometer.
The Barometer Index rose 5 points above December to a reading of 141. The barometer’s rise was primarily attributable to a 9-point rise in the Current Conditions Index, while the Future Expectations Index rose just 3 points.
Compared to recent surveys, fewer producers pointed to lower crop and livestock prices as a top concern last month.
“It’s optimism about the future that’s really driving this uptick in the ag economy barometer the last three months,” said Michael Langemeier, Purdue University ag economist and director of the Center for Commercial Agriculture, during an AgriTalk segment earlier this week.
Here are three key takeaways from the latest survey of 400 U.S. farmers, which was conducted between Jan. 13-17:
1. The improvement in farmer sentiment for January was linked to higher crop prices between early December and mid-January.
For example, Langemeier said Eastern Corn Belt farmers saw a 9% rise in corn prices for near-term delivery and a 5% bump for soybeans.
“We also had that continuing resolution in late December, and those payments for corn, soybeans and wheat, I think, is helping sentiment,” he told Davis Michaelsen, AgriTalk news anchor.
2. Some farmers expect to have a larger operating loan for this year.
The barometer revealed a slight increase in the percentage of farmers who anticipate having larger loans this year — 18%, up from 15% in 2024.
Among those farmers expecting an increase, 23% attributed it to carrying over unpaid operating debt from the previous year, compared to 17% last year and just 5% two years ago.
“What that points out to me is there is more financial stress right now than there has been probably since we first started asking the question about operating loans in 2020,” Langemeier said. “That’s a warning signal. It’s something very worrisome for individual farms, lenders and everybody else.”
Langemeier added while there is an uptick in financial stress for agriculture, there are still many folks out there with strong balance sheets. “So we’ve got to be a little cautious here in interpreting the numbers,” he said.
3. While 40% of the farmers surveyed believe it is likely or very likely the U.S. would enter a trade war, their economic sentiment has not deteriorated.
Instead, over 50% of that group of farmers believe the safety net for farmers will actually be stronger under the Trump administration than it was under the Biden administration.
“Reading the tea leaves, what that tells me that is the respondents are thinking, even if we have a trade war and some problem with trade policies, they remember those payments that occurred when Trump was president before, particularly for soybeans back in 2018,” Langemeier said. “They’re thinking that safety net’s still going to be there, even if we have trade woes.”
Along with those three points, Langemeier also addressed what farmers said in the survey about leasing farmland for solar energy production and the potential impact of South American crops on U.S. exports. Get those details on the AgriTalk podcast here:
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