AGRI-MARKETERS' CONFIDENCE INDEX DROPS
Aug. 12, 2015
Source: Agri Marketing magazine
The Agri-Marketers' Confidence Index (AMCI) dropped to its second lowest score since its inception in 2011.
The poll, conducted by the American Business Media's AgriMedia Council and Agri Marketing magazine among managers of corporate agribusinesses in July, 2015, shows they believe the current situation has declined for their companies and for farmers and ranchers.
However, agri-marketers are taking a more bullish outlook for their companies and for farmers and ranchers over the next 12 months with 34% expecting the general outlook will be better.
On a scale of 0 (lowest) to 100 (highest), the overall AMCI scored a 55 which is down from 63 when the poll was last conducted in March 2015.
Don Tourte, VP/Market Leader Penton Agriculture and Chairman of the AgriMedia Council, says, "During the prior survey period, we saw an uptick in grain prices and thus a more positive outlook. Grain prices, however, have softened since then and so has agri-marketers' outlook.
"However, it is not just about grain prices," he continues. "The majority of the U.S. are going to have record crops so, even if prices are low, farmers will have a lot of grain to sell."
Steve Custer, Executive VP/Chief Operating Officer at Farm Journal Media and Co-Chair of the AgriMedia Council's Research Committee explains, "The livestock market is strong with the exception of the dairy market. Herd and flock expansions are underway which is a real positive for those companies who are in that market space.
Bill Miller, Vice Chairman at Meister Media Worldwide and Co-Chair of the AgriMedia's Research Committee notes, "One huge positive is the financial condition most producers are in today. Most will be able to weather the storm for quite some time and it should be noted that the specialty fruit and vegetable crops continue to experience high consumer demand which bodes well."
To view the report click here.
"It is also interesting to note that 24% of the respondents reported their organizations are planning to increase their marketing communications budgets, 21% plan to decrease them with the balance leaving them at the same level," says Lynn Henderson, Publisher of Agri Marketing magazine. "That compares to a year ago when 17% of agri-marketers reported they were going to increase their budgets and 44% were going to decrease them."
The poll was sent to 235 managers of companies that develop and sell products to U.S. and Canadian crop and livestock producers. A total of 122 (52%) company representatives participated in the poll, including a very wide sampling of large and small enterprises, as well as both crop and livestock-oriented companies. This is significantly higher than past survey responses according to Henderson.
"The AMCI is modeled closely along the lines of the well-known consumer confidence studies regularly reported by The Conference Board," reports Custer.
"It is an indicator designed to measure the confidence or the degree of optimism among corporate agribusiness marketers on the state of the agribusiness economy. It looks at both their outlook for their own business now and in the future, as well as their perception of the outlook for their customers - the nation's farmers and ranchers."
AMCI is calculated by looking at the percentage of positive versus negative responses.
To read how AMCI is calculated and its complete results click here.
Summer 2015 Confidence Index