With a whirlwind of trade activity as a backdrop, commodity market gyrations have made unsettling times for grain producers in Texas and across the nation, but there’s hope those are leveling, according to a Texas A&M AgriLife Extension Service economist.
“Trade is a powerful tool,” said Mark Welch, Ph.D., AgriLife Extension grain marketing economist, College Station. His comments came as part of the 2020 Blackland Income Growth Conference in Waco.
With phase one of the U.S.-China trade pact signed, Welch reminded attendees of the importance of trade relations and the “Man Controlling Trade” statue in front of the Federal Trade Commission in Washington.
For consumers, the outlook is positive with a steady grain supply projected and no immediate threat to corn food products.
For corn producers, conditions appear right for a large supply of corn in 2020. If that happens, prices are projected to stay relatively flat to lower, around $3.50 a bushel, with little prospect of $5-a-bushel corn in the immediate future.
Welch said recent U.S. domestic corn use has been flat to lower. In 2019, about 10 million acres of major crops did not get planted. Much of the price forecast depends on what gets planted on those acres in 2020. He expects increases in both corn and soybeans to make up for prevented plantings last year.
Welch said corn acreage at about 93 million acres and an average yield in the mid-170 bushels to the acre would produce one of the largest corn crops in U.S. history. That’s at a time of steady to lower domestic use and increased competition for the export market, he said.
Meanwhile, Jeff Hyde, Ph.D., AgriLife Extension director, College Station, provided the keynote during the noon program before more than 330 attendees. Hyde commended the work of the Blacklands region producers.
“It takes a lot of faith and hope to be a farmer,” he said. “It also takes a lot of smarts and hard work. We appreciate everything you do and the sacrifice you make.”
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