The Canadian Farmer Sentiment Index for October 2024 is out, and it is very clear that farmers are pessimistic about their current farm financial performance relative to twelve months ago. Although farmers see improved financial performance in the future over their current state, even future performance is still seen as negative overall at 84 out of 200.
Going back to September 2022 through January 2024, farmers were more positive about current financial performance than future farm financial performance, but after a couple quarters of them being equal, farmers are feeling more positive about the future than the current state. This also holds true for the general outlook of the agricultural economy in the next twelve months (62) versus sixty months (79).
In terms of what is providing optimism versus concern, we asked farmers to pick three reasons for each (results below).
Although only 19 per cent of farmers thought commodity prices were a reason to be optimistic and 73 per cent identified commodity prices as an area of concern, farmers are more bullish on the markets in comparison to the last twelve months (121). Although this question has produced high levels of volatility in the past, confidence in marketing plans are relatively stable at 91.
When it comes to it being a good time to make farm investments, farmers are indicating an improvement (69). Overall this is still negative on a scale of 200 but finally the index has broken free of its previously narrow band of results. This is the third time in a row the result has increased over the prior index. Our assumption is that this is being driven by a reduction in interest rates as the Bank of Canada attempts to spark the Canadian economy. This improved willingness to invest is happening at a time that current farm financial performance is weaker relative to twelve months ago.
In the coming weeks RealAgriculture and RealAgristudies will provide further results on questions related to trade, land values, cost saving measures and political views. You can find out more about our research at RealAgristudies.com.
