Last year was a “terrible production year,” but Dr. John Anderson predicted that farmers will be able to recover in 2020.
Anderson, agribusiness economist and department chair of the College of Agriculture at the University of Arkansas, shared his perspective on the farm economy future during a workshop at the American Farm Bureau Federation annual convention last month.
He said there are times when he feels confident predicting agriculture’s future, “but this is not one of those times.”
Anderson said 2019 was a “terrible production year,” but crop supplies for 2020 “look a little better.”
He said the new trade deals that were passed right before the convention—the United States.-Mexico-Canada Agreement and phase one of a deal with China—should improve the demand stream for U.S.-produced farm goods. “I’m hopeful exports will grow dramatically.”
Anderson noted that agricultural crop production has exceeded demand for the past several years. He said the trade deals will help improve prices for agricultural commodities as well.
In Virginia, soybean growers and livestock producers were hit hard by the trade tariffs, noted Wilmer Stoneman, vice president of agriculture, development and innovation for Virginia Farm Bureau Federation. “We expect the new trade deals to help our farmers, as well as those across the country. Agricultural supply has exceeded demand these past few years, and our farmers are ready for that tide to turn.”
When examining specific crops, Anderson said corn has been “remarkably stable” over the past few years, while soybean production dropped significantly. Futures pricing for corn, soybeans, cotton and wheat all show slight improvement, leading him to feel “cautiously optimistic” about agricultural row crops.
The outlook for livestock and poultry is similar to that for row crops, Anderson said. Meat production has been steadily increasing since 2016, but there needs to be a strong demand.
“We’re looking for a really nice increase in pork exports in 2020,” he noted. China is the largest consumer and producer of pork. With African swine fever wiping out much of its domestic supply, China will need to buy pork and other proteins from other countries, Anderson said.
He added that he expects dairy prices to improve this year, and is “fairly optimistic about beef and poultry prices” as well.