Coronavirus fears ease, but many farmers expect a worse year financially

An unusually large portion of U.S. farmers and ranchers expects worse financial performance on their farms this year than last, said a Purdue University poll released on Tuesday. And although producers are less worried by the coronavirus pandemic than in the spring, they are calling for President Trump and Congress to provide more money.

The monthly Ag Economy Barometer, based on a survey of 400 large-scale producers, said 43% of respondents expected a worse year financially, sharply higher than 30% at the end of 2019 or 22% in April 2018. Farmers are a famously dour group. In Purdue polling, few expect a better year and the majority routinely says things will be "about the same," with a sizable vote for "worse."

"Producers were somewhat less concerned about the impact of coronavirus on their farm's profitability than they were earlier this spring, but two-thirds of respondents still said they feel Congress needs to pass another bill to provide economic support to farmers as a result of the pandemic," said economists James Mintert and Michael Langemeier, who oversee the Ag Barometer.

The USDA has paid $6.8 billion in coronavirus aid to farmers so far this year. Agriculture is all but certain to get another dose of cash from the ongoing negotiations over new coronavirus legislation, said Senate Finance chairman Chuck Grassley during a teleconference. The House has voted for an additional $16.5 billion for payments to producers and Senate Republicans have proposed $20 billion for Agriculture Secretary Sonny Perdue to distribute. But there was a chance of a "skinny" bill that would handle urgent issues such as unemployment compensation, with agriculture and other sectors left for action in September, he said.

Farmer concern about the pandemic declined in step with lessening expectations of poorer financial performance. For example, in May, 71% said they worried about the coronavirus' impact on their farm's profitability and 54% said they expected a worse financial performance this year. In the latest poll, 61% said they worried about the coronavirus and 43% expected worse financial results. Unchanged was belief by a 2-to-1 margin, "it will be necessary for the president and Congress to pass another bill to provide more economic assistance to farmers."

Coronavirus aid was a large factor for a slowdown in farm bankruptcy filings in federal courts during April, May and June, said the American Farm Bureau Federation. Data from the courts showed 115 petitions were filed under the Chapter 12 farm bankruptcy law during the second quarter of this year, 50 fewer than in the same period in 2019. "Without additional support for agricultural producers, we can expect an acceleration of farm bankruptcies in the immediate future," said the largest U.S. farm group.

The Ag Economy Barometer is available here.