Purdue Ag Barometer Shows Sharp Decline in Farmer Confidence

Farmer sentiment weakened sharply in January as the Purdue University-CME Group Ag Economy Barometer (AEB) Index dropped from 136 in December 2025 to 113 in January 2026 (see Figure 1). The Current Conditions Index dropped 19 points while the Future Expectations Index dropped 25 points (see Figure 2). Among the five indices that make up the AEB Index, the largest decline was in the question asking participants whether U.S. agriculture would have good times or bad times in the next five years. The index for this question fell from 122 to 88, marking its lowest point since September 2024. Respondents also expressed greater concerns about agricultural exports compared to last month. The January barometer survey took place from January 12-16, 2026. As a point of reference, the January WASDE report was released on January 12.

One-half of the producers surveyed reported that their farm operations were worse off than a year ago. Moreover, looking ahead 12 months, 30% expected worse financial performance, compared to 20% who expected better financial performance. At a reading of 47, the Farm Capital Investment Index decreased by 11 points from the previous month, reaching its lowest level since October 2024 (see Figure 3). Only 4% of the survey respondents indicated that they planned to increase farm machinery purchases in the upcoming year.

Since 2020, each January barometer survey has included questions about farmers’ operating loans for the upcoming year. The percentage of respondents who said they expect to have a larger operating loan this year compared to a year ago rose to 21%, up from 18% last year. In a follow-up question, producers who expect to have a larger operating loan were asked about the reasons for the increase. This year, 31% of producers who expect their loan size to increase said it was because they were carrying over unpaid operating debt from the prior year, up from 23% in 2025, 17% in 2024, and only 5% in 2023. These results are consistent with respondents’ concerns about their financial performance.