Rising input costs continue to weigh on a farmer’s perception of the ag economy. That was part of the reason for the two-point decline for the June Purdue University/CME Group Ag Economy Barometer. Center for Commercial Agriculture Director Jim Mintert is not surprised. “I think there’s a recognition among producers that the current financial conditions aren’t too bad. There’s been a run up in costs, but a pretty strong rally in commodity prices,” says Mintert. “Longer term, people are worried about the idea that the entire production costs are much higher going into next year. Looking back at history, once costs go up, it’s tough to bring them back down. Commodity prices are volatile. We’ve seen that the last few weeks.” That commodity price volatility could lead to production/cost squeezes in 2023.
