I receive economic information from various sources, including “Agricultural Economic Insights”. Recently Brent Gloy and David Widmar wrote about the possible biggest issues facing agriculture in 2020.
Below are their top 11 issues facing agriculture in 2020. I have added a few additional questions. Do you agree?
- Farm Income—Several factors including trade wars, MFP payments and commodity markets will affect farm income.
- Farm Finances–the trend has been toward higher debt levels and lower working capital over the past 5 years. How do the balance sheets look for 2020?
- African Swine Fever–Was 2019 the worst year for ASF or just the tip of the iceberg? Obviously, China and other Asian countries have been widely affected. Will ASF come to the U.S.? Will U.S. be able to increase pork exports to Asia to cover their losses? How does ASF affect the corn and soybean prices?
- Trade War—It appears that the China Trade War will at least have a Phase I approval. Some reports indicate greatly improved exports to China have been approved. As Gloy and Widmar state, it is hard not to be both optimistic and yet skeptical.
- Drama in D.C.—USMCA, impeachment, tensions in the Middle East, EPA and RFS and an election! Will Congress get USMCA finally passed? Any changes in farm policy? Will MFP be a talking point? Who will win the RFS controversy?
- S. Economy—will the economy continue to expand? Or will it stall for some reason? It has been a record-long economic expansion? Can it continue?
- Global Unrest—they note North Korea and Iran as primary unrest situations. What about poor economies throughout Europe?
- Acreage Debate—Will we have 100 million acres of corn planted in 2020? Higher soybean acres? There will be a lot of speculation early spring.
- 2020 Weather—It appears that neither an El Nino nor La Nina will come about, leading to a neutral condition. How will this affect weather in the Midwest? Central plains? Some areas of the Plains are experiencing dry weather already. Midwest still has wet conditions. How will the spring start?
- Ending Stocks—Soybean stocks declined in 2019. How will global production be in 2020?
- Good Times Ahead for U.S. Livestock Producers?—Will the China Phase I deal really provide opportunities to export meat in response to the ASF outbreak?
As Gloy and Widmar note, all of these factors will affect decisions made this spring. Which ones will be the greatest challenge to overcome? How to market grain (and livestock) with these factors facing us? Certainly these are several factors to consider?