Farmer Sentiment Weakens as Margins Tighten
Michael Langemeier and Joana Colussi, Purdue Center for Commercial Agriculture
Farmer sentiment dropped again in May as the Purdue University-CME Group Ag Economy Barometer (AEB) Index declined from 121 points in April to 119. The Current Conditions Index fell by 8 points, while the Future Expectations Index increased by 1 point This month’s Current Conditions Index was 21 points below last year’s December index, reaching its lowest level since December 2024.
In May, the survey also asked farmers to identify the main factor limiting improvement in their farm’s financial situation. High input costs were by far the most frequently cited constraint, selected by 46% of respondents. Weather risk ranked second at 19%, followed by low output prices at 14%, labor and equipment concerns at 9%, and debt or financial pressure at 5%.
Questions related to the impact of the Iran conflict on net farm income and corn breakeven prices in 2026 were included again this month. Similar to the results from April, approximately two-thirds of the respondents expected their net farm income to decline in 2026 due to the Iran conflict, which began in late February. Among respondents who planted corn in 2025, approximately one-half expected corn breakeven prices to increase by up to 6%, 17% expected breakeven prices to increase by 6% to 9%, and 30% expected them to increase by 10% or more.
Periodically, the monthly survey includes questions about farm labor. Approximately 39% of respondents hire non-family members to work on their farm operations. Of those who hire labor, approximately 44% have had at least some or a lot of difficulty hiring this year. Respondents were also asked whether artificial intelligence (AI) tools would improve their current labor and equipment situation. Approximately 59% indicated that it would not improve their situation, while 37% indicated that it would help some, and 4% indicated that it would help a lot.
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