Rising inflation that’s feeding into costlier food sources is producing positive income for the farmer this year, but when it comes to sentiment, it was more negative during the month of October.
While income is rising, there’s a healthy fear that inflation could eventually outpace consumer demand and, thus, weaken income for farmers. This is evident in the metric known as the Purdue University-CME Group Ag Economy Barometer, which tracks farmer sentiment.
The metric was down during October as inflation continues to be a primary concern. As an Agri-View report noted, “this year’s weakness in farmer sentiment is taking place despite very strong net farm income compared to the earlier period.”
Furthermore, the report added that concerns regarding “farm’s financial performance was one of the drivers of weakening sentiment among producers. The Farm Financial Performance Index decreased 13 points this month to 86.”
The October survey also said that inflated input costs remain a primary concern, and it’s also no surprise that inflation is still causing farmers much worry. As such, Agri-View reported that the “percentage of producers choosing reduced output prices as a critical concern increased to 13 percent, matching the percentage of producers who chose input availability as a major concern.”
Get Agricultural Commodities Exposure
Commodities can continue providing an ideal inflation hedge in the current market environment and as an asset diversification tool. Regarding commodities exposure, most investors may think of oil, but agricultural exposure can also provide more commodities diversification.
Investors looking to gain commodities exposure can look to exchange traded funds (ETFs) for easier access. Specifically, consider the Teucrium Agricultural Fund (TAGS).
For investors looking for agriculture exposure who don’t know where to start, this is where Teucrium can fill a void, offering investors an easy solution. Getting exposure to commodities doesn’t mean investors have to hold various positions.
Investors can have it all in the convenience of TAGS. The fund combines exposure to corn, wheat, soybeans, and sugar through other Teucrium ETFs that focus specifically on these commodities, essentially offering investors a fund of funds.
The fund includes singular ETFs that focus on a specific commodity, such as wheat, via the Teucrium Wheat Fund (WEAT), but that’s not all. To get that broad exposure, TAGS also includes the Teucrium Corn Fund (CORN), the Teucrium Soybean Fund (SOYB), and the Teucrium Sugar Fund (CANE).
For more news, information, and strategy, visit the Commodities Channel.