Farmer sentiment improved in April as long-term optimism outweighed tariff concerns, according to the Purdue University/CME Group Ag Economy Barometer.

The latest edition of the barometer, released May 6, climbed 8 points to 148, just off the recent peak of 152 in February.

“I was a little bit surprised with the increase, given what’s taken place,” said James Mintert, Purdue ag economist, in an online analysis.

The rise in farmer sentiment in April occurred despite ongoing trade disputes to top U.S. agriculture trading partners, including Mexico, Canada and China.

Livestock producers, who are doing well at the moment, might be lifting the score, as are hopes of government compensation and other factors.

The barometer remains relatively high compared to most of the past decade and well above its reading of 99 a year ago.

Tariff impacts, compensation

Seventy percent of farmers and ranchers responding to the barometer survey reported they expect increased U.S. tariffs to benefit the nation’s ag economy in the long run.

Still, 56% of respondents think tariff policy will have a negative or very negative impact on their farm’s incomes in 2025, while 53% expect tariffs to make it more difficult to obtain inputs this year.

Producers highlighted fertilizer, parts for farm machinery and electronics and crop chemicals as areas of concern in obtaining inputs.

If a trade war leads to lower prices for U.S. ag products, farmers remain confident they will receive government assistance through something resembling the 2019 Market Facilitation Program.

“Eighty percent of the producers think a program similar to MFP will be implemented to help compensate for losses. That’s up from 70% who felt that way a month earlier,” Mintert said

Making big investments?

A component of the barometer, the Farm Capital Investment Index, increased 7 points to 61, its highest reading since May 2021.

Following President Donald Trump’s election win, that metric shifted considerably.

From May through October 2024, the investment index averaged a reading of 36.

In April, about one in four producers said it was a good time to make large investments, nearly double the amount from May to October the past year.

Still, two-thirds of respondents said it was a bad time for major investments.

“When you look at what’s taken place with respect to farm machinery sales, especially here in early 2025, they are down dramatically,” Mintert said.

First-quarter sales of tractors more than 100 horsepower dropped 19% compared to the previous year’s first three months, while new combine sales were down 38%, according to the Association of Equipment Manufacturers.

Financial performance

The barometer’s Farm Financial Performance Index edged up to 101, 1 point above the previous month.

“That leaves that index still 11 points higher than it was in October and 33 points higher than it was back in September,” Mintert said.

April was the fourth straight month the index was above 100, which indicates that producers expect financial performance this year to equal or slightly exceed a year ago.