Ag Economy Barometer shows farmers believe renewable fuels to drive higher crop prices

In Indiana, farmer sentiment weakened again in March as the Purdue University-CME Group Ag Economy Barometer fell 8 points to a reading of 117. The survey included several renewable energy questions focused on the ethanol and renewable diesel sectors, which had much more positive results. When asked to look ahead 5 years, nearly half (46%) of respondents said they expected the renewable diesel industry to be larger than it is today. This compares to just 25% of respondents who expect the ethanol industry to grow in size over the next 5 years. In a follow-up question, respondents were asked what impact they expect the renewable diesel industry to have on soybean prices over the upcoming 5 years. The most common response chosen by 39% of respondents was a price increase of up to $0.50 per bushel while just over one-fourth (28%) of farmers in the March survey said they expect renewable diesel to boost soybean prices in a range of $0.50 up to $1.00 per bushel. Finally, just over one out of five producers (21%) expect soybean prices to rise by $1.00 or more per bushel as a result of increased demand from the renewable diesel industry.