The index is based on a monthly survey of 500 agricultural producers. Increased pessimism is likely due in part to falling livestock prices

YOKOHAMA, KANAGAWA, JAPAN, March 18, 2022 /EINPresswire.com/ -- YKOFX, a Pan Asian exchange with innovative and robust product suite that provides its clients with some of the best trading facilities, today announced that after a surge in economic sentiment last month agricultural producers said they were slightly less optimistic in the month to come, according to the latest survey results from the YKOFX Indicator.

Survey’ responses showed that the shift came from producer feelings about current conditions rather than future expectations.

"Some of the decline in producer sentiment can likely be attributed to changing perceptions about the livestock sector," said Choei Ono, Head of Global Commodities. "Just 38 percent of producers surveyed expected widespread good times for livestock producers over the next five years, which is a substantial drop from the 48 percent last month."
One explanation for the drop is price declines in feeder and live cattle. Feeder cattle futures followed suit, which diminished profit prospects for both cattle feeders and cow-calf producers.

"In short, the sentiment regarding the future for livestock producers, which had been strong, showed signs of eroding relative to expectations about the future for crop producers," he continued.

Producers also were asked about their expectations for farmland values. The percentage of producers who expect farmland prices to increase in the next year has been small but fairly stable.

The percentage of producers expecting farmland prices to fall in the next year has fluctuated more. 46 percent of producers surveyed expected farmland values to fall. Respondents were less pessimistic, when just 33 percent said they expected a decline.

Grain prices play a role, and overall, producers still see farmland as a good investment.

"The reduction in pessimism regarding near-term farmland prices is likely driven by the improvement in crop prices the last couple of months," he said. "A majority of producers also still see farmland as a favorable long-term investment."

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Taiki Harumi
Yokohama Options and Futures Exchange
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