Analysis Ground
Investors driving force in US land market
The mood in American agriculture is not improving, according to the Ag Economy Barometer from Purdue University and the CME Group. High input costs and the real risk that crop and livestock prices will fall further are weighing on the mood among American farmers.
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Choose the subscription that suits youCompared to last month, the sentiment in the index fell by 3 points to 105 points. The mood is more negative in the short term than in the longer term, the poll shows. By far the largest group of farmers, namely 33%, cites rising production costs as their main concern. A quarter consider lower sales prices for grain and livestock to be the greatest risk and slightly fewer participants, namely 23%, believe that higher interest rates could cause problems.
Although farmers in the survey by Purdue University and the CME Group are more negative about the short term than the long term, the development of the land market is assessed differently. The expected short-term value development of agricultural land remains unchanged compared to last month. The participants are slightly less certain whether land will continue to increase in value in five years' time. Of the group that expects land prices in the US to rise further, the majority (57%) indicate that this is mainly due to demand for land from investors outside agriculture. Another important reason for rising land prices is inflation.